AURIZON CUTS FULL YEAR FORECASTS AS FULL FORCE OF CYCLONE DEBBIE BECOMES CLEAR
Written on the 18 April 2017 by Ben Hall
RAIL freight operator Aurizon (ASX: AZJ) has slashed its full year guidance by $100 million to $115 million because of major disruptions to its network in Queensland from Tropical Cyclone Debbie.
Aurizon's projections for FY2017 on earnings before interest and tax (EBIT) have been revised down to $800 to $850 million from its original guidance of $900 to $950 million.
However, the company announced it could recover up to $80 million through "regulatory processes in future years".
Shares in the Brisbane-based company went into a trading halt on Tuesday ahead of the announcement and they were down 1.8 percent to $5.19 at around 3pm Tuesday AEST when trading resumed.
"Three out of four Aurizon coal systems, which make up the Central Queensland Coal Network (CQCN) have now re-opened to coal trains and are operating under restricted conditions with some reduced capacity," the company says in a statement to the ASX.
The company reports that its Blackwater coal system, which connects into the Port of Gladstone re-opened to coal traffic on April 10, the Moura system into the Port of Gladstone became operational on April 12 and the Newlands coal system into Abbot Point Coal Terminal resumed on April 13.
The Goonyella coal system was the worst hit by Debbie and was originally expected to take five weeks to repair but will now re-open a week and a half early on April 26 with speed restrictions and reduced capacity.
It means capacity on its rail networks for FY2017 will be reduced by 12 to 14 million tonnes down to 190 to 200 million tonnes.
Business New Australia
Author: Ben Hall