Transcription of Presentation by Aurizon Holdings Limited (ASX:AZJ) Managing Director and CEO, Lance Hockridge
Aurizon Holdings Limited (ASX:AZJ)
is Australia’s largest listed rail based freight company. We operate nationally, particularly in the resource related space carrying iron ore, coal, a range of other mineral resources. But also in the freight business, the intermodal business, right throughout the length and breadth of Australia.
When we released our 2015 financial year results, we were again able to report a significant uplift in our financial outcomes. A 14 per cent increase in EBIT to $970 million, an uplift in NPAT. Beyond that, for me the most significant thing was we delivered on all of our promises to our owners. In particular we had promised that we would deliver an operating ratio of 75. In other words a 25 per cent EBIT margin in the business, up from about 10 per cent at the time of the IPO. So a very significant outcome.
The final dividend is up 64 per cent. Overall the dividend for the year is up 45 per cent, compared to the prior year. Our payout ratio guidance has gone up to 70 to 100 per cent. And again for the year that’s just gone, this represents a final payout of 100 per cent.
Over that period since listing, we’ve invested multi-billions of dollars in projects across our business. Here in Queensland we’ve completed two major greenfield initiatives, the so-called Northern Missing Link project in northern Queensland and the Wiggins Island terminal. But along with that, things like the electrification of one of our major rollingstock Spur lines in central western Queensland. In New South Wales, we’re just in the process of commissioning a major new maintenance facility, in the Hunter Valley.
In Sydney we’ve signed with our friends at Qube Holdings Limited (ASX:QUB)
for the development of the Moorebank facility in Sydney, which I think is just going to be a hallmark of the future of the freight business, the interstate intermodal business. As things like congestion, things like the need to be able to - particularly if we can get good policy reform in this space, see more product on rail and off roads. These are the kind of opportunities that are going to underpin the ability of our company to be able to grow.
Our focus over the next 12 months is going to continue to be in this transformation efficiency space. We know that times are tough for our customers. We know that our top line is going to be relatively stable, over that period of time. Our objective is therefore to continue to widen the margin in the business by again putting in place these new enterprise agreements, the new technology, the better use of our assets, right across the board. A whole wealth of activity all directed toward better service for our customers, better outcomes financially, better returns for the owners of the business.