By NZPA
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Thursday 12th September 2002 |
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Operating profit was $23.9 million, in line with its forecast, compared with $45.2 million last year. But when unusual items of $97.6 million were taken into account, there was an operating loss of $70.8 million.
"There really wasn't anything that's significantly changed from what we were expecting," said Andrew Mortimer, an analyst with First NZ Capital, referring to a statement the company made to reassure the market in July.
The only disappointment, he said, might be the fact that there was no update on the company's restructuring plans, after hinting it might be looking at capital raising.
Managing director Michael Beard told reporters today that no decision had been made.
"The board will consider all available matters, including re-alignment of its debt facility...both short and long term...and raising new equity as appropriate."
Tranz Rail, which closed up 3c at $1.65 on the sharemarket, said there would be no dividend.
The result included $143.3 million from asset writedowns and changes in accounting treatments, Tranz Rail said.
It said the figure was at the lower end of the range previously indicated -- up to $170 million -- and included a $17 million adjustment to reflect changes to the ferry Aratere's lease.
Reorganisation costs of $45.1 million were also incurred during the year.
Mr Beard said the company had been performing to budget since balance date and remained confident of achieving its targeted operating profit of $55.8 million in the current financial year.
"The 2002 financial year was always going to be the most heavily affected by our change in programme with the benefits of restructuring not appearing until the 2003 financial year," he said in a statement.
"We've started the current year well. We have achieved gains from new freight business in recent months and improving levels of customer service and delivery reliability."
The company's total revenue r ose by 6 percent to $665.9 million, boosted by a $58.3 million gain realised on the Auckland rail corridor and $5.8 million made on the sale of the Tranz Scenic passenger service.
But other unusual items cost the company $61.9 million for writedowns, $17.2 million to change its accounting treatment of the Aratere ferry lease, a $16.9 million writedown on goodwill including that of Tranz Link International Pty Ltd and unusual costs on rolling stock leases ($11.6 million).
The company suffered some heavy drops in freight revenue during the year including fertiliser (33.3 percent), manufactured products (14.3 percent), and forestry products (26 percent).
However, it saw an 3.9 percent rise in other freight and a 9.8 percent rise in coal revenue. All up, there was a 6.2 percent, or $28.9 million, drop in its total freight revenue of $434.6 million.
Passenger revenue dropped 3 percent or $4.5 million to $139.4 million, largely because of the closure of non-profitable service and the Tranz Scenic business.
Operating costs increased 21.9 percent or $132.2 million to $736.7 million including $161.7 million in writedowns and reorganisation costs, including company severance payouts. During the year, Tranz Rail reduced its staff by 29 percent, reflecting in part the outsourcing of its engineering division.
Fourth quarter figures showed a net loss of $146.9 million compared with a net loss of $0.8 million in the June quarter last year.
Total revenue of $147 million was $4.6 million lower than the previous corresponding quarter.
Mr Beard told reporters that the company was working through negotiations to sell its Wellington commuter operations. It also expected a ratings review with Standard and Poor's to come out on Friday.
Chief financial officer Wayne Collins said the company was expecting a downgrade.
"I think we can acknowledge that we have a heavily geared structure. In view of our operating results over the last year, the company is expecting that S&P will downgrade."
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