Rail freight operator Aurizon has announced the closure of its Forrestfield terminal by the end of the year, as part of a national restructure that will result in the loss of 250 jobs.
Rail freight operator Aurizon has announced the closure of its Forrestfield terminal by the end of the year, as part of a national restructure that will result in the loss of 250 jobs.
Brisbane-based Aurizon said today it would close all of its intermodal operations outside Queensland.
In addition, it has agreed to sell its Queensland intermodal business to a consortium of Linfox and Pacific National, while its Acacia Ridge terminal in Brisbane will be sold to Pacific National.
The total payment for both assets is $220 million.
Intermodal is a containerised rail and road freight haulage business for retailers, wholesalers and freight forwarders.
The non-Queensland business includes the Brisbane to Melbourne and Sydney to Perth routes, terminals at Forrestfield and Enfield (Sydney), plus locomotives, wagons and road vehicles.
The Forrestfield closure will result in the loss of 20 jobs.
Chief executive Andrew Harding said the intermodal decision followed a 12-month review, which found the business did not offer a sustainable commercial future.
"The business has not been able to establish significant scale and a customer base to support a profitable business in such a highly competitive market," he said.
"While a difficult decision for affected employees, exiting the business will allow the company to focus on core, profitable parts of the Aurizon portfolio including the ability to recycle capital into other growing parts of our business."
The restructuring announcement came on the same day Aurizon disclosed a full-year loss of $188 million on the back of a $927 million hit from asset impairments and redundancy related costs, which had been previously foreshadowed.
The company reported a loss in statutory earnings of $91 million, blaming $811.2 million in asset impairments, including a $526 million write-down in the value of its bulk business, and $115 million in redundancy costs for more than 920 employees across the business.
Its underlying earnings before interest and tax for the year to June 30 was down 4 per cent at $836 million, on the back of an estimated $89 million loss from the impacts of Cyclone Debbie, lower iron ore earnings and a deterioration in the performance of its freight business.
Aurizon said the cyclone, plus a deterioration in the financial performance of the freight business, more than offset the realisation of sustainable transformation benefits of $129 million.
Mr Harding said Aurizon had the potential to deliver and would work to improve its business and customer outcomes.
"Today's results and announcements underline our determination to return to the fundamental strengths of our core business and to ensure we unlock value and return it to shareholders," he said.
