Asciano records loss but signals good times ahead

Asciano records $976 million loss, but the company points to good times ahead on the back of internal reforms

By Brad Gardner | August 26, 2010

Asciano has recorded a loss of almost $1 billion, but the company is pointing to good times ahead on the back of internal reforms.

Announcing its end of year results yesterday, Asciano listed a loss after tax of $976 million due in part to a writedown of $1.1 billion. The loss after tax is a significant increase on the 2009 financial year result of $244.1 million.

Buffeted by the global financial downturn, it suffered a decline in intermodal volumes and lower trade levels through container terminals. The impact was partially offset by a 14 percent increase in steel tonnages hauled and its coal divison securing seven new contracts in Queensland and NSW.

Asciano CEO and Managing Director Mark Rowsthorn says the company is working on a five year business development program to improve productivity and asset utilisation.

"This program will instil a culture of continuous improvement and will deliver significant savings over the five year period," Rowsthorn says.

It will also restructure its business by moving from four to three divisions: Patrick Ports, Pacific National Rail and Pacific National Coal.

"The structure in place over the past two years was extremely effective to drive costs and deliver efficiencies; the next stage is to create synergies by integrating these enhanced businesses," Rowsthorn says.

"The coal business will remain a standalone business to ensure there is continued focus on the significant growth opportunities in this area. We expect that the simplified structure will also create improved clarity and understanding of our businesses."

The company is also expecting an increase in earnings this financial year due to continued growth in the resource and bulk commodity sector.

Asciano’s earnings before interest and tax grew by 15.4 percent to $439.6 million due largely in part to its coal haulage division.

It moved more than 14.5 million tonnes during the year and Asciano says volumes in the NSW Hunter Valley increased by 4 percent.

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