Asciano reports 19 percent profit rise

Drawn-out industrial action has failed to slow Asciano, which today reported a full-year profit of $240.8 million

Asciano reports 19 percent profit rise
Asciano reports 19 percent profit rise
August 22,

Rail and ports operator Asciano has reported a 19.4 percent rise in full-year net profit despite costly industrial action in its terminals and logistics division, according to company results released today.

The financial results show the company's net profit rose to $240.8 million for the year to June 2012 from a restated $201.6 million.

In a statement to the Australian Securities Exchange, Asciano chief executive John Mullen highlights Asciano’s terminals and logistics division as a standout performer in light of a drawn-out industrial dispute, which has cost the company $21 million.

"The terminals
and logistics division reported an 8.5 percent increase in Earnings Before Interest and Taxes (EBIT) – a credible result given the direct and indirect impact on both the business and our management team of the negotiations over a new
enterprise agreement (EA)
and the restructure of the logistics business," Mullen says.

industrial standoff between Asciano and the Maritime Union of Australia (MUA) ended in April after almost 20 months of negotiations on
the new
EA for Patrick Container Terminal employees.

Meanwhile, a separate strike at the Port Kembla coal terminal is estimated to have cost the company $3 million.

But the costs
are scarcely reflected in
Asciano's results, which show a total
EBIT growth of 14 percent.

Operating cash flow after tax and financing costs increased 22 percent to $608 million and revenue was up 11.7 percent.

‘‘I am extremely pleased with this result, both as a standalone result but also in light of the challenging operating environment we have experienced over the last 12 months,’’ Mullen says.

The company’s Pacific National rail revenue increased 14.6 percent, with EBIT up 13.3 percent.

Pacific National coal revenue increased 19.5 percent, with EBIT up 26.6 percent.

Asciano’s bulk and automotive port services division grew its revenue by 4.5 percent, with EBIT up 45.3 percent.

"The results reflect the benefits of new contract wins, an ongoing focus on restructuring underperforming businesses and our business improvement program, which yielded in financial year 2012 despite the delay in commencing new investment in the terminals and logistics division," Mullen says.

Recent contracts won by Asciano include:


A new 10-year contract for 8.5mtpa with Rio Tinto to commence in November 2013

A new 15-year contract with Bandana Energy for the movement of up to 4mtpa in Queensland from July 2014

A new contract with Emerald Group for two take or pay grain trains, with operations starting in July

New bulk shuttle service contracts for Linfox and Toll in Port Botany

- New contracts with Anglo American and Middlemount in January 2012

- A
new 10-year contract with Bloomfield in the Hunter Valley
signed in July

- Renewed contracts with NYK, Arrium, Westlink, Swire and Shell

A contract with Agility services for the position of marine transport services to the supply base for the Gorgan project in Western Australia

- The extension of the Western Port Management contract for a further five years.

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