Queensland flood damage dampens Aurizon’s outlook
By Sean Muir
| February 20, 2013
Queensland flood damage is expected to dampen Aurizon’s full-year earnings, with repairs alone expected to
cost more than $10 million.
The Blackwater and Moura coal systems in Aurizon’s
Central Queensland coal network
were hit hard by heavy rain and flooding following ex Tropical Cyclone Oswald.
The Blackwater system reopened earlier this month after a 12 day outage, but a subsequent derailment caused a further four days’ disruption.
The Moura system reopened last night after a 26 day outage.
The below-rail repair cost associated with the flood damage is estimated to be $10-15 million, with Aurizon intending to recover the costs under the regulatory process in the 2014 financial year.
Lost coal volumes are expected to be about 4 million tonnes, about $22 million in earnings before interest and tax (EBIT).
The financial impact of the derailment is expected to be about $5 million in EBIT.
“Taking into account the impact of the recent floods and derailment – a loss of throughput of around 4mt together with the potential for some recovery of coal tonnes lost – we expect our FY13 coal volumes to be in the range of 192-195mt,” Aurizon CEO Lance Hockridge says.
“We will continue to work with our customers with the objective of all parties recovering lost tonnages, noting the average weekly coal railings in the 13 weeks prior to the floods was 3.94mt.”
“Over the medium to long-term we remain optimistic about the outlook for the resources and bulk commodity sectors, based on sustained global demand for Australian coal and iron ore and a strong domestic economy.
“As well as successfully securing a series of long-term, high-value haulage contracts Aurizon has a strong pipeline of new and expansion projects that will underpin our growth well into the next decade.”