Rail and ports operator Asciano may sell its Pacific National operations in a quest to raise much needed funds
Rail and ports operator Asciano may sell its Pacific National operations in a quest to raise much needed funds after posting a $93 million loss over the half-year period.
Asciano Chief Executive Mark Rowsthorn today confirmed to journalists in Melbourne the possibility of offloading Pacific National’s coal transporting business, saying it will raise a much-needed $1 billion for the organisation.
Rowsthorn says Asciano is in the final stages of a possible deal and may make an announcement in the near future.
However, even with the sale of Pacific National Rowsthorn says Asciano is still in for a rough year.
“In the short term, the Australian and international economies look likely to continue to experience low levels of growth, and this results in a degree of uncertainty around our business,” Rowsthorn says.
Rowsthorn says a sudden halt in production has already been experienced in some areas of the company, but remains confident other ventures will still hold firm.
“During December, our non-bulk operations (particularly Patrick Container Ports, Patrick Autocare and Pacific National Intermodal) experienced a significant slowing in volumes,” he says.
The half-yearly results are grim for the company, which suffered a $70.5 million loss this time last year.
There were significant charges of $97.5 million, which consisted of goodwill impairment against investments in Patrick Autocare totalling $82.8 million and $10.1 million of plant and equipment impairment in Pacific National Tasmania.
Rowsthorn says the impairment charges were results of a stringent assessment of expected cash flow in all of the organisations businesses, in both the short and medium terms.
“Conversely, the strong performance of our bulk operators (particularly coal and grain) is expected to continue for the balance of the current financial year,” Rowsthorn says..
Results for January were greater than expected and the company is aiming for efficiency gains of $100 million by the end of the year.
“A number of key initiatives have been, and will be, implemented to drive efficiency and margin growth across the business and to position Asciano for long term growth beyond the current economic cycle,” Rowsthorn says.