Rail sale steams closer

TRANSPORT Infrastructure group Asciano says it is close to picking a preferred partner to buy its coal rail business Pacific National.
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Pacific National coal train.

Angie Tomlinson

During December Asciano shortlisted parties as it attempts to raise capital by selling of one or more of its business units.

Asciano expects to raise more than $A1 billion from the sell off which it will use to reduce debt. The deal is expected to be finalised this financial year.

The impact of the global economic downturn on Asciano was evident in its half-year results released yesterday.

Asciano booked a net after-tax loss, including significant items, of $93.4 million, up almost $23 million from its $70.5 million net loss in the same period the previous year.

Significant items included goodwill impairments of $82.8 million, impairment of plant and equipment of $10.1 million, and $4.6 million in restructuring costs.

Total revenue for the half was $1.5 billion, with earnings before interest, tax and amortisation increasing 4.9% to $41.1 million compared to the same period the previous year.

Its coal division performed to expectations, primarily driven by strong demand for coal exports in northern New South Wales.

Pacific National Coal grew EBITDA by 7.4% during the half, on the back of stronger volumes with net tonne kilometres (NTKs) increasing by 11% for the period.

Record levels of export tonnes, NTKs, revenue and EBITDA were recorded during the month of December.

Asciano chief executive Mark Rowsthorn said in the short term the Australian and international economies look likely to continue to experience low levels of growth, resulting in business uncertainty.

“These challenging market conditions are expected to persist through the March quarter. Conversely, the strong performance of our bulk operations – particularly coal and grain – is expected to continue for the balance of the current financial year,” he said.