BOSSES at rail infrastructure operator Network Rail could be in line for further bonuses after the group announced it was on track for profits.

Half-year losses at the group narrowed and delays were reduced by 16 per cent, according to figures for the six months to September 30.

Network Rail said it was now being run more efficiently after rail maintenance work was taken in-house and costs scaled back.

Members of the executive team could receive a bonus of up to 30 per cent of their salaries if they hit punctuality, cost efficiency and track standard targets.

Losses for the period were reduced to £34m from £233m a year earlier, while the business made operating profits of £225m - up from losses of £95m last time.

Chief executive John Armitt said it had been an encouraging period following 12 successive months of punctuality improvements.

He said: "Passengers are benefiting from improved punctuality and the completion of key projects, though we all recognise much remains to be done before we deliver the railway the public rightly expects."

Network Rail took on more debt during the period, although the figure of £13.9bn at the end of September was still below previous forecasts.

With debt at £10.3bn a year earlier, the company warned that the resulting higher interest payments would lead to increased losses for the second half of its financial year. Seasonal factors are also expected to affect costs in the current six-month period.

The company, which took over responsibility for the railway network in 2002, said one of its key achievements had been completing the process of bringing rail maintenance in-house.

The task, which involved 16,000 workers, 5,000 road vehicles and 600 depots, should help reduce annual maintenance expenditure by 30 per cent by 2008/2009.

As a result, half-year turnover of £1.87bn included £51m of net performance income, compared with penalties of £213m a year earlier. Last year, turnover was £1.5bn.

Network Rail said the past six months had seen a 16 per cent reduction in delays compared with the same period a year earlier. The rate had been seven per cent in the previous financial year.

The improvement led to an increase in the proportion of trains arriving on time, with the average up from 81.2 per cent in March to 81.8 per cent by mid-September. The long-term target is 90 per cent punctuality by March 2009.