Shares in transport infrastructure company Asciano (AIO) plunged to an all-time low of $4.53 today after the company posted an inaugural first-half loss of $71.1 million due to demerger and restructuring costs.
The company was hopeful in its outlook and tipped underlying growth for the year, although this went unnoticed in a market that fell sharply in early trade, with the S&P/ASX 200 falling 3% by late morning.
AIO securities closed at $4.58, a fall of 7.85% or 39 cents on Friday’s close.
Asciano said the net loss reflected a number of special items relating to the demerger of Asciano from Toll Holdings, and the restructure of its grain business.
Following its spin-off from Toll Holdings in June 2007, Asciano said revenue from ordinary activities rose 3.9% to $1.5 billion from a proforma $1.45 billion.
Its earnings before interest and tax rose 21% to $236,000.
Commenting on the results, Asciano managing director Mark Rowsthorn said, “The growth in underlying earnings and the associated improvement in margins reflect a strong half-year for Asciano.
Asciano was positive in respect to its outlook and said it plans to close down its grain business.
“Asciano has commenced the downsizing program in our grain business. While discussions continue with the grain industry, in the absence of volume risk being mitigated through the introduction of take-or-pay contract, Asciano will close the business,” Rowsthorn said.
The company was also positive in respect to its medium to longer term outlook:
“Our diverse business base, and particularly our exposure to growing commodity exports, containerised and motor vehicle imports, and domestic freight, should see Asciano continue to generate organic EBITDA growth in the range of 10% to 15% per annum over the longer term,” Rowsthorn added.
The Melbourne-based company was confident about its debt position which has been a source of speculation for the market.
It reported a total outstanding bank debt of $4.9 billion, an “appropriate level given Asciano’s underlying assets and cashflow”.
“Following recent extensions to Asciano’s short-term facilities, Asciano now has no debt maturing until 2009, and 92% of Asciano’s total outstanding debt matures during or after May 2010,” the company said.
“Asciano has existing interest rate hedges in place today equivalent to 70% of its outstanding debt, with a weighted average maturity of hedges of 3.5 years,” it added.
The group declared an interim distribution of 23 cents per share.
Its shares have more than halved from the high of $11.64 in late June which was reached after its spin-off from Toll Holdings in the wake of the Patrick takeover.
Rowsthorn commented the acquisition of Patrick Ports businesses has paid dividends.
“Our Patrick Ports businesses have continued to trade well during the period. Our Auto, Bulk and General ports have benefitted from strong vehicle and steel volumes in particular, together with efficiency improvements,” he said.
Asciano has operation in Australian and New Zealand.
