Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


KiwiRail cuts earnings forecast as Aratere outage weighs

KiwiRail cuts annual earnings forecast as Aratere outage weighs, in talks with govt over finances

Feb. 28 (BusinessDesk) - KiwiRail, the state-owned rail service, has cut its forecast operating profit as the outage of the Aratere inter-island ferry weighs on earnings, and is in talks with the government to ensure it has enough cash to last the rest of the year.

The Wellington-based state-owned enterprise reported a 21 percent drop in operating profit to $37.3 million in the six months ended Dec. 31, as a 0.7 percent gain in revenue to $365.5 million was outpaced by a 3.9 percent lift in expenses to $328.2 million. The full results won’t be made public until they are tabled in Parliament. The SOE said it has renewed focus on cutting costs in new recruitment and major capital purchases.

KiwiRail cut its forecast operating profit to between $90 million and $100 million in the year ending June 30, a reduction of $20 million to $30 million from its Statement of Corporate Intent. It estimates the outage of the Aratere ferry, which is undergoing repairs after its propeller fell off in November, will cost between $20 million and $30 million in the financial year.

“The financial impact is significant and we are doing all we can to mitigate that impact,” chairman John Spencer said. “We are also in discussions with our shareholder to ensure we have the necessary financial capacity for the remainder of the year.”

KiwiRail has previously said it doesn’t expect to make a net profit within the next decade as it writes down the carrying value of its assets to market value, while investing in renewing its network.

The company’s domestic freight sector grew 11 percent in the period on increased export and liquid milk volumes, and anticipates further growth in log volumes. The Wellington passenger businesses, TranzMetro, increased passenger numbers in the half, and the Scenic passenger unit is showing signs of growth after a concerted marketing effort, KiwiRail said.

(BusinessDesk)


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Bad Day For Rope: Donaghys Job Losses Another Blow To Dunedin

The loss of 30 jobs from Donaghys rope and twine factory is yet another blow to the people and economy of Dunedin, says Dunedin South Labour MP Clare Curran. More>>

ALSO:

Oil: 2014 New Zealand Petroleum Summit

Simon Bridges: Our abundance of energy and minerals resources provides us with unique opportunities to build the New Zealand economy.

Over the past three years the Government has made significant changes to how the sector is regulated. More>>

ALSO:

WWF Report: Solutions In Reach; World Biodiversity Suffers Major Decline

Global wildlife populations have declined by more than half in just 40 years as measured in WWF's Living Planet Report 2014. Wildlife's continued decline highlights the need for sustainable solutions to heal the planet... More>>

ALSO:

Scoop Business: NZ Dollar Catches Breath After "Goldilocks" Slump

The New Zealand dollar edged up following its dramatic slump yesterday after the Reserve Bank confirmed speculation it intervened in the currency market last month and PM John Key suggested a “Goldilocks” level far lower than at present. More>>

ALSO:

Biosecurity: Kiwifruit Claim To Hold Officials Accountable For Psa

Kiwifruit growers have joined forces to hold Biosecurity NZ accountable in the courts for its negligence in allowing 2010’s Psa outbreak that devastated New Zealand’s kiwifruit industry and exports. Foundation claimants representing well ... More>>

ALSO:

Poison: Anglers Advised Not To Eat Trout In 1080 Areas

With the fishing season opening in just a few days (1 October 2014), anglers are being warned by the Department of Conservation(DOC) not to eat trout from pristine backcountry waters and their downstream catchments, where the department is conducting 1080 poisoning operations. More>>.

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news