Tranz Rail Tracking Well

Tranz Rail Tracking Well

Tranz Rail told its Annual Meeting in Auckland today that the Company was tracking well in the second quarter on its way to meeting its 2003 operating profitability targets.

Reflecting on a difficult 2002 financial year that resulted in a net loss of $123 million, Tranz Rail Managing Director Michael Beard told shareholders that after having met the first quarter targets for the current year, the second quarter was also progressing well as the company sought to nearly double last year’s operating profit of $27 million to $53.1 million in the current year.

“Quarters two and three are traditionally our strongest because of the export and retail cycles and also the peak holiday traffic on the ferries,” said Mr Beard. “Although we are only in the first month of the second quarter we are seeing good forestry and bulk rail volumes while Distribution Services Group, our trucking operation, is also moving into peak retail volumes.

“It is on our performance in quarters two and three that shareholders will be able to judge the performance of the new-look company that has emerged from a two-year restructuring period.”

Mr Beard said that restructuring had placed Tranz Rail on a good footing for long-term, sustainable earnings.

“Our focus is on service delivery, reliability, performance and growth of revenue. All the performance figures show we are driving those factors in the right direction. It is that underlying performance that will, in the end, drive the results that shareholders want.”

Recently appointed Tranz Rail Chairman Wayne Walden echoed those sentiments telling shareholders that much of the recent uncertainty surrounding the company was now gone.

“Subject to credit approvals, the Aratere lease has been resolved, the rights issue will resolve our capital structure issues and we expect new banking facilities to be approved by the 20th of November,” said Mr Walden.

“The bulk of the change programme is now complete and its associated impacts are off the balance sheet.

“The new Board has closely re-examined the company’s current direction and is confident that the company and its management team are on the right path to deliver the changes that customers want and the performance that shareholders desire,” said Mr Walden.