AURIZON DEALT WITH $30M BLOW
Written on the 3 March 2015
AURIZON Holdings Limited (ASX:AZJ) has signalled a potential $30 million blow to its earnings following Cyclone Marcia and industrial action across the state.
The rail freight operator has estimated the total financial impact of Cyclone Marcia on Earnings Before Tax and Interest (EBIT) to be between $24 million and $28 million.
The Category 5 cyclone hit north of Rockhampton on February 20 and tracked south over the Blackwater and Moura rail systems.
Aurizon's network business was the hardest hit with between $14 million and $16 million in losses, including reduced revenue and damage repairs to infrastructure.
Services on the Blackwater coal system has resumed, with repairs on the Moura corridor anticipated to be completed by the end of March.
The EBIT impact on its above-rail and coal business is between $10 million and $12 million, with the company offering additional services to recoup lost volumes for customers.
Meanwhile the estimated EBIT impact of the industrial campaign from Queensland rail unions is up to $2 million.
It follows train-crew strikes across the state last month, organised by the Rail, Tram & Bus Union and Australian Federal Union of Locomotive Employees.
Both unions will continue to negotiate two outstanding Enterprise Agreements, however there are no further plans for industrial action at this point according to Aurizon.