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KiwiRail records 2% revenue growth in 2017-18

KiwiRail records 2% revenue growth in 2017-18

KiwiRail records 2% revenue growth in 2017-18

KiwiRail, New Zealand’s rail transport operator, has released its 2018 financial year results, revealing that its revenue was up 2% on the previous year, despite the $45 million dent made by 2016’s Kaikoura earthquake, the impacts of which are ongoing.


This article  is directly from Rail Express. Written by David Loneragan – Sydney (david.loneragan@primecreative.com.au) on August 29, 2018
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The operator’s recorded operating surplus for the financial year up to June 2018 was $49 million, within its $30-$50 million EBITDA commitment to the NZ government. The underlying surplus – which excludes the costs inflicted the earthquake – was $94 million.

KiwiRail acting chair Brian Corban said the result was a testament to the efforts made in re-energising operations over the past four years, noting in particular the revenue increase in coal, milk and forestry freight in particular.

“These gains are despite the on-going challenge of the Main North Line railway between Picton and Christchurch still closed for daytime freight services while the recovery work from the 2016 Kaikoura earthquake continues,” Corban said.

“The rebuild work has contributed to an impairment charge of $249 million as an accounting requirement means that capital expenditure is written off each year, valuing assets considerably below replacement cost.”

Tourist service revenues were up 22% on the 2017 financial year result. Corban said that this result was an excellent prelude to the return of the award-winning Coastal Pacific Great Journey of New Zealand from December 1, which has received numerous bookings from New Zealanders and international visitors.

Total capital expenditure was $261 million, including $57 million on locomotives and wagons.

“Even through this difficult period, KiwiRail has achieved productivity initiatives to the tune of $7 million and invested $9 million more in Capital Expenditure than the prior year (excluding Kaitaki ferry purchase), primarily in rolling stock replacement as we seek to renew our ageing locomotives and wagons,” Corban said.

Peter Reidy, KiwiRail’s chief executive said that a strong platform had been set for the operator’s future growth.

“We have reorganised our operations, network, rolling stock and terminal teams under a new structure led by a Chief Operations Officer so that we are aligned around our customer promis,” Reidy said.

“Our next stage is to design the network needed for New Zealand’s future, with the smart assets, partnerships and workforce of the future that will deliver on this ambition.”

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