Aurizon Holdings Ltd. · ASX:AZJ
Aurizon — 1HFY2020 Earnings Presentation
85 slides from Aurizon's earnings presentation, Feb 10, 2020
Slide 1: Half Year Results Analyst Presentation
Aurizon Holdings Limited ABN 14 146 335 622 For personal use only ASX Market Announcements ASX Limited 20 Bridge Street Sydney NSW 2000 BY ELECTRONIC LODGEMENT 10 February 2020 Half Year Results Analyst Presentation Please find attached for immediate release to the market, the Half Year Results anal
Slide 2: 1HFY2020 Results
1HFY2020 Results Andrew Harding – Managing Director & CEO Pam Bains – CFO & Group Executive Strategy For personal use only 10 February 2020
Slide 3: Disclaimer
1HFY2020 RESULTS Disclaimer For personal use only NO RELIANCE ON THIS DOCUMENT NO OFFER OF SECURITIES This document was prepared by Aurizon Holdings Limited (ACN 146 335 622) (referred to Nothing in this presentation should be construed as a recommendation of or an offer to sell or a as “Aurizon” wh
Slide 4: Safety performance
1HFY2020 RESULTS Safety performance Tragic road accident in Queensland in December 2019 resulted in a fatality. Aurizon For personal use only continues its focus on safety TOTAL RECORDABLE INJURY FREQUENCY RATE RAIL PROCESS SAFETY (TRIFR)1 -14% 11.07 5.49 Incidents per million train kilometres trave
Slide 5: Performance overview
1HFY2020 RESULTS Performance overview For personal use only Andrew Harding Managing Director & CEO
Slide 6: 1HFY2020 highlights
1HFY2020 RESULTS PERFORMANCE OVERVIEW 1HFY2020 highlights1 Solid results confirm EBIT guidance for FY2020. On market buy back increased by $100m to For personal use only $400m GROUP EBIT STATUTORY NPAT2 ROIC FREE CASHFLOW2 $456m $343m 10.5% $465m up 12% up 51% up 0.5ppt up 26% NETWORK CAPITAL COAL V
Slide 7: Coal update
1HFY2020 RESULTS PERFORMANCE OVERVIEW Coal update Coal has secured key contract extensions delivering on its strategy of de-risking and For personal use only extending the contract book CUSTOMER UPDATE COAL CONTRACT VOLUME EXPIRY BY YEAR 1H19 v 1H201 60 › Peabody – extension of all existing volumes
Slide 8: Bulk update
1HFY2020 RESULTS PERFORMANCE OVERVIEW Bulk update Ahead of expectations with strong performance driven by new contracts and operational For personal use only efficiencies CUSTOMER UPDATE BULK BUSINESS CHARACTERISTICS › Mineral Resources – three year contract for rollingstock leasing, crewing and yar
Slide 9: Network update
1HFY2020 RESULTS PERFORMANCE OVERVIEW Network update QCA approved UT5 Undertaking delivers significant regulatory reform and a range of benefits for For personal use only entire coal supply chain INDICATIVE UT5 TIMELINE 03/05/19 30/06/17 30/06/18 30/06/19 30/06/20 30/06/21 30/06/23 30/06/27 WACC 5.9
Slide 10: Other matters
1HFY2020 RESULTS PERFORMANCE OVERVIEW Other matters Progress of other major items For personal use only COMPLETE SALE OF RAIL › Sale completed 31 October 2019 – net proceeds received $165m GRINDING BUSINESS › $105m gain on sale accounted for in 1HFY2020 IN PROGRESS › 15 May 2019 – Federal Court of A
Slide 11: Financial Performance
1HFY2020 RESULTS 1HFY2020 Financial Performance For personal use only Pam Bains CFO & Group Executive Strategy
Slide 12: Key financial highlights
1HFY2020 RESULTS FINANCIAL PERFORMANCE Key financial highlights1 EBIT improvement reflects the approval of the UT5 Undertaking and the improved For personal use only performance in Bulk $m 1HFY2020 1HFY2019 Variance › Revenue reflects the approved UT5 Undertaking in Network and new Revenue 1,529 1,4
Slide 13: Coal
1HFY2020 RESULTS FINANCIAL PERFORMANCE Coal EBIT result impacted by lower than expected volumes For personal use only $m 1HFY2020 1HFY2019 Variance Revenue Above rail 629 617 2% › Volumes flat – down 3% in CQCN impacted by Track access 259 271 (4%) customer production issues, NSW & SEQ up 6% Other 1
Slide 14: Bulk
1HFY2020 RESULTS FINANCIAL PERFORMANCE Bulk Turnaround ahead of plan For personal use only Revenue $m 1HFY2020 1HFY2019 Variance › Revenue higher through new contract growth and Revenue 297 260 14% improved revenue quality Costs Access costs (65) (63) (3%) › Higher operating costs from new contracts
Slide 15: Network
1HFY2020 RESULTS FINANCIAL PERFORMANCE Network EBIT performance reflects the uplift in revenue from the approved UT5 Undertaking For personal use only Revenue $m 1HFY2020 1HFY2019 Variance › Increase in track access revenue principally as a Track Access 565 534 6% result of the UT5 Undertaking Servi
Slide 16: Capital expenditure
1HFY2020 RESULTS FINANCIAL PERFORMANCE Capital expenditure Capital expenditure forecast for FY2020 reduced to $500m - $530m due to timing of growth For personal use only projects CAPITAL EXPENDITURE1 FY2016 – FY2020(f) ($M) 703 › Growth capital in 1HFY2020 includes new rollingstock in CQCN and infra
Slide 17: Legal and capital structure review
1HFY2020 RESULTS FINANCIAL PERFORMANCE Legal and capital structure review Standalone funding structures established for Operations and Network with independent For personal use only gearing levels, consistent with their different business risk profiles NEW LEGAL STRUCTURE IMPLEMENTED › Legal structu
Slide 18: Funding update
1HFY2020 RESULTS FINANCIAL PERFORMANCE Funding update Near term focus is the refinance of the $525m AMTN Network bond maturing in October For personal use only 2020 FY2020 FUNDING ACTIVITY KEY DEBT METRICS 1HFY2020 1HFY2019 › Network issued 10.5 year, $82m $A private placement Weighted average 4.0 y
Slide 19: Outlook & Key Takeaways
1HFY2020 RESULTS Outlook & Key Takeaways For personal use only Andrew Harding Managing Director & CEO
Slide 20: FY2020 outlook
1HFY2020 RESULTS OUTLOOK & KEY TAKEAWAYS FY2020 outlook Group EBIT guidance remains $880m – $930m For personal use only KEY ASSUMPTIONS › Network - Uplift in WACC from 5.9% to 6.3% assumed mid CY2020 › Above Rail Coal volumes 210 - 220mt › Operational efficiency improvements remain a key driver in t
Slide 21: Strategy delivers results
1HFY2020 RESULTS OUTLOOK & KEY TAKEAWAYS Strategy delivers results Aurizon’s strategy enables the delivery of shareholder value For personal use only Achieved Execute De-risked Ongoing Optimal legal Restructured fundamental Freight near term operational and capital to Business regulatory Review Abov
Slide 22: Contact and further information
Contact and further information Chris Vagg Kath Clapham Head of Investor Relations & Group Treasurer Manager Investor Relations +61 7 3019 9030 +61 7 3019 9044 For personal use only chris.vagg@aurizon.com.au kath.clapham@aurizon.com.au ASX: AZJ US OTC: AZNNY
Slide 23: Additional information
1HFY2020 RESULTS Additional information For personal use only ESG Group Coal Bulk Network Capital Expenditure
Slide 24: Additional information: ESG
1HFY2020 RESULTS Additional information For personal use only ESG
Slide 25: Sustainability
1HFY2020 RESULTS ADDITIONAL INFORMATION Sustainability FY2019 was the third year of TCFD disclosure for Aurizon For personal use only › Aurizon takes a direct approach to reporting environmental, OUR FY2019 social and governance (ESG) disclosures with the SUSTAINABILITY publication of the annual Sus
Slide 26: Environment
1HFY2020 RESULTS ADDITIONAL INFORMATION Environment Aurizon continues to focus on cutting diesel and greenhouse gas emissions as part of our For personal use only efforts to maintain Australia’s excellent air quality standards and manage our carbon footprint AURIZON’S GREENHOUSE GAS PROFILE AURIZON’
Slide 27: Additional information: ESG – Future of Coal
1HFY2020 RESULTS Additional information For personal use only ESG – Future of Coal
Slide 28: Australian Export Coal Demand
1HFY2020 RESULTS ADDITIONAL INFORMATION Australian Export Coal Demand The fundamentals of Australian metallurgical and thermal coal remain strong, driven by steel For personal use only and energy demand in Asia, supporting coal export growth of 1-2%pa over the next decade METALLURGICAL COAL THERMAL
Slide 29: Australia FY2019 Coal Supply Summary
1HFY2020 RESULTS ADDITIONAL INFORMATION Australia FY2019 Coal Supply Summary For personal use only Coal Production Domestic Consumption Export All Coal Export (By Destination) All Coal Export (By Port) 114mt 162mt 454mt 60mt 393mt 88mt 118mt 51mt 56mt 72mt 29% 49mt 41% 22% 35mt 30% State Split State
Slide 30: Global Coking (Metallurgical) Coal Landscape
1HFY2020 RESULTS ADDITIONAL INFORMATION Global Coking (Metallurgical) Coal Landscape Around one-quarter of global metallurgical coal demand is met through seaborne trade with For personal use only Australia commanding over 60% of this market 2017, million tonnes 1,040mt 713mt Import Market: Split 99
Slide 31: Future of Coal – Metallurgical Coal
1HFY2020 RESULTS ADDITIONAL INFORMATION Future of Coal – Metallurgical Coal Driven by urbanisation and infrastructure development, the opportunity remains for India and For personal use only South East Asian nations to increase steel usage INDIA: CRUDE STEEL PRODUCTION AND COKING APPARENT (CRUDE STE
Slide 32: Metallurgical Coal Market | Australia
1HFY2020 RESULTS ADDITIONAL INFORMATION Metallurgical Coal Market | Australia Driven by quality, cost-competitiveness and proximity to Asian markets, Australia holds a unique For personal use only position in the seaborne market. A further 25 billion tonnes1 of resources can be drawn upon AUSTRALIA:
Slide 33: Global Steam (Thermal) Coal Landscape
1HFY2020 RESULTS ADDITIONAL INFORMATION Global Steam (Thermal) Coal Landscape Over 80% of global thermal coal demand is produced and consumed within country. Australia For personal use only holds a 20% share of the seaborne market that is dominated by Asian demand 2017, million tonnes 5,678mt 4,648m
Slide 34: Future of Coal – Thermal Coal
1HFY2020 RESULTS ADDITIONAL INFORMATION Future of Coal – Thermal Coal 98% of Australian exports are destined for Asia. It is this region (rather than global For personal use only consumption) that is projected to use coal-fired generation assets for a prolonged period PER CAPITA ELECTRICITY CONSUMPT
Slide 35: Thermal Coal Market | Australia
1HFY2020 RESULTS ADDITIONAL INFORMATION Thermal Coal Market | Australia Australia’s thermal coal competitiveness is driven by coal quality characteristics and For personal use only geographic proximity to Asia AUSTRALIA: THERMAL COAL EXPORT1 THERMAL COAL CASH COSTS (US$/t, CFR JAPAN, 2019)2 250 $150
Slide 36: Additional information: ESG - Bulk
1HFY2020 RESULTS Additional information For personal use only ESG - Bulk
Slide 37: Bulk – Australia Capital & Exploration Expenditure
1HFY2020 RESULTS ADDITIONAL INFORMATION Bulk – Australia Capital & Exploration Expenditure For personal use only CAPITAL EXPENDITURE: METAL ORE MINING1 EXPLORATION EXPENDITURE: IRON ORE +31% A$4.0b A$150m +17% A$100m A$2.0b A$50m A$0.0b A$0m Jun- Dec- Jun- Dec- Jun- Dec- Jun- Dec- Jun- Jun- Dec- Jun
Slide 38: Bulk commodities: Global & Australia
1HFY2020 RESULTS ADDITIONAL INFORMATION Bulk commodities: Global & Australia For personal use only Global & Australia supply growth (CAGR 2019-2024) (Selected commodities) 11.2% 4.0% 3.7% 3.5% 2.0% 0.9% Lithium Nickel Copper Potash Phosphate Bauxite Iron ore Alumina Zinc Global Australia Notes/Sourc
Slide 39: Additional information: Group
1HFY2020 RESULTS Additional information For personal use only Group
Slide 40: Aurizon's rail haulage operations
1HFY2020 RESULTS ADDITIONAL INFORMATION Aurizon’s rail haulage operations For personal use only KEY OPERATIONAL STATISTICS COMMODITIES Coal, iron ore and bulk freight ROLLINGSTOCK ~500 active locomotives OPERATIONAL FOOTPRINT ~40 operational sites PEOPLE More than 4,600 full-time employees WAGONS 11
Slide 41: Vision, purpose, values and strategic levers
1HFY2020 RESULTS ADDITIONAL INFORMATION Aurizon’s vision, purpose, values and strategic levers Execution against the three strategic levers is aimed at driving differentiation, competitive For personal use only advantage and sustainable performance VISION PURPOSE STRATEGIC LEVERS Accelerate cost com
Slide 42: Enterprise Agreements
1HFY2020 RESULTS ADDITIONAL INFORMATION Enterprise Agreements For personal use only Headline Increases # Staff Term EA Covered Expiry Date Year 1 Year 2 Year 3 Year 4 Comments (years) (approx.) WA Rollingstock 100 4 10 May 2021 1.0% 1.5% 1.75% 1.75% Complete Maintenance WA Rail Operations 420 4 30 J
Slide 43: Prioritisation of capital
1HFY2020 RESULTS ADDITIONAL INFORMATION Prioritisation of capital For personal use only CAPITAL ALLOCATION HIERARCHY 1 2 3 4 DETERMINE NON GROWTH SURPLUS AVAILABLE DIVIDENDS CAPITAL CAPITAL CAPITAL › Ongoing operating › Sustaining and › Within 70-100% › Capital management cashflows transformation pa
Slide 44: Financial highlights (underlying)
1HFY2020 RESULTS ADDITIONAL INFORMATION Financial highlights1 (underlying) For personal use only $m 1HFY2020 1HFY2019 Variance 2HFY2019 Revenue 1,528.8 1,455.4 5% 1,452.2 Operating costs (797.6) (783.7) (2%) (752.3) EBITDA 731.2 671.7 9% 699.9 EBIT 455.6 406.0 12% 423.0 NPAT 268.9 226.9 19% 246.4 EP
Slide 45: Underlying group EBIT bridge
1HFY2020 RESULTS ADDITIONAL INFORMATION Underlying group EBIT bridge ($m) For personal use only 5 456 29 30 406 4 1HFY2019 Coal Bulk Network Other 1HFY2020 44
Slide 46: EBIT by business unit (underlying)
1HFY2020 RESULTS ADDITIONAL INFORMATION EBIT by business unit (underlying) For personal use only $m 1HFY2020 1HFY2019 Variance 2HFY2019 Coal 205.8 210.3 (2%) 204.8 Bulk 43.7 14.2 208% 23.1 Network 232.2 202.9 14% 197.4 Other (26.1) (21.4) (22%) (2.3) EBIT1 455.6 406.0 12% 423.0 1. Continuing Operati
Slide 47: Group operating highlights
1HFY2020 RESULTS ADDITIONAL INFORMATION Group operating highlights1 For personal use only $m 1HFY2020 1HFY2019 Variance 2HFY2019 Labour Costs2 / Revenue 26.1% 25.5% (0.6ppt) 26.5% EBITDA Margin – Underlying 47.8% 46.2% 1.6ppt 48.2% Operating Ratio – Underlying 70.2% 72.1% 1.9ppt 70.9% Tonnes (m) 129
Slide 48: Other profit & loss (underlying)
1HFY2020 RESULTS ADDITIONAL INFORMATION Other profit & loss (underlying) For personal use only $m 1HFY2020 1HFY2019 Variance 2HFY2019 Revenue 28.0 40.9 (32%) 41.3 Total operating expenses (51.1) (57.6) 11% (38.5) EBITDA (23.1) (16.7) (38%) 2.8 Depreciation and amortisation (3.0) (4.7) 36% (5.1) EBIT
Slide 49: Quarterly tonnes – December quarter 2019
1HFY2020 RESULTS ADDITIONAL INFORMATION Quarterly tonnes – December quarter 2019 For personal use only Quarter Dec-19 Year Financial Variance Quarter Ending vs. to date Dec-18 Dec-18 Mar-19 Jun-19 Sept-19 Dec-19 % Dec-19 Dec-18 % Coal volumes (mt) CQCN 38.4 36.4 39.5 36.6 37.7 (2%) 74.3 76.4 (3%) NS
Slide 50: Cashflow and shareholder returns
1HFY2020 RESULTS ADDITIONAL INFORMATION Cashflow and shareholder returns For personal use only FREE CASH FLOW ($M) SHAREHOLDER RETURNS ($M) +10% 830 735 762 704 669 301 300 552 465 465 488 462 69 340 215 227 529 462 396 247 FY15 FY16 FY17 FY18 FY19 1HFY20 FY15 FY16 FY17 FY18 FY19 1HFY20 Total Group
Slide 51: Balance sheet summary
1HFY2020 RESULTS ADDITIONAL INFORMATION Balance sheet summary For personal use only $m 31 December 2019 30 June 2019 Assets classified as held for sale1 74.7 108.4 Other current assets 607.8 631.2 Property, plant & equipment 8,499.3 8,536.3 Other non-current assets 437.6 425.2 Total assets 9,619.4 9
Slide 52: Reconciliation of borrowings
1HFY2020 RESULTS ADDITIONAL INFORMATION Reconciliation of borrowings For personal use only $m Commentary Total debt including working capital facility 3,184.8 › Non-current debt on a Cash basis Reconciliation to Financial Statements Add/(less): › Transaction costs directly attributable to borrowings
Slide 53: Significant Items
1HFY2020 RESULTS ADDITIONAL INFORMATION Significant Items For personal use only $m 1HFY2020 1HFY2019 Variance 2HFY2019 Continuing operations – Gain on sale of Rail Grinding 105.4 - - - Discontinued operation - Intermodal 2.5 (10.3) nm (1.1) 52
Slide 54: Redundancy cost information
1HFY2020 RESULTS ADDITIONAL INFORMATION Redundancy cost information For personal use only › Redundancy costs since IPO have been included in Redundancy costs Redundancy costs underlying EBIT as well as classified as a significant Year included in underlying classified as item EBIT ($m) Significant i
Slide 55: Dividend history
1HFY2020 RESULTS ADDITIONAL INFORMATION Dividend history For personal use only Amount per share Payment Date Franking Payout Ratio (cents) FY2020 Final FY2020 Interim 23 March 2020 13.7 70% 100%1 FY2020 Total Dividend FY2019 Final 23 September 2019 12.4 70% 100%1 FY2019 Interim 25 March 2019 11.4 70
Slide 56: Adoption of new accounting standards
1HFY2020 RESULTS ADDITIONAL INFORMATION Adoption of new accounting standards The Group adopted AASB 16 from 1 July 2019 For personal use only IMPACT ON BALANCE SHEET › The adoption of AASB 16 results in almost all previously ASSETS $m recognised operating leases being recognised on the balance Curre
Slide 57: Additional information: Coal
1HFY2020 RESULTS Additional information For personal use only Coal
Slide 58: Coal snapshot
1HFY2020 RESULTS ADDITIONAL INFORMATION Coal snapshot As at 31 December 2019 For personal use only 106 336 233km average haul million tonnes active locos length 74 8,570 23.8km/hr average services active wagons velocity per day TONNES HAULAGE BREAKDOWN (estimate as at 30 June 2019) Thermal Coal CQCN
Slide 59: Coal operations - CQCN
1HFY2020 RESULTS ADDITIONAL INFORMATION Coal operations - CQCN For personal use only Includes all mines in the CQCN 58
Slide 60: Coal operations – NSW & South East Queensland
1HFY2020 RESULTS ADDITIONAL INFORMATION Coal operations – NSW & South East Queensland (SEQ) For personal use only Includes all mines in NSW & SEQ 59
Slide 61: Coal profit and loss (underlying)
1HFY2020 RESULTS ADDITIONAL INFORMATION Coal profit and loss (underlying) For personal use only $m 1HFY2020 1HFY2019 Variance 2HFY2019 Tonnes (m) 106.3 106.5 - 107.8 Above Rail 628.5 616.7 2% 619.5 Track Access 258.9 270.5 (4%) 217.2 Other 1.2 0.3 300% 0.6 Total Revenue 888.6 887.5 - 837.3 Operating
Slide 62: Coal financial and operating metrics
1HFY2020 RESULTS ADDITIONAL INFORMATION Coal financial and operating metrics For personal use only 1HFY2020 1HFY2019 Variance 2HFY2019 Tonnes (m) 106.3 106.5 - 107.8 NTKs (bn) 24.8 25.1 (1%) 25.4 Above Rail Revenue /NTK ($/’000 NTK) 25.3 24.6 3% 24.4 Opex (excl access)/NTK ($/’000 NTK) 17.2 16.3 (6%
Slide 63: Coal haulage tonnes (mt) by system
1HFY2020 RESULTS ADDITIONAL INFORMATION Coal haulage tonnes (mt) by system For personal use only 1HFY2020 1HFY2019 Variance 2HFY2019 CQCN Newlands 10.5 9.9 6% 8.9 Goonyella 29.1 30.4 (4%) 30.6 Blackwater 28.4 29.1 (2%) 29.8 Moura 6.3 7.0 (10%) 6.6 Total CQCN 74.3 76.4 (3%) 75.9 NSW & SEQ West Moreto
Slide 64: Coal contract portfolio
1HFY2020 RESULTS ADDITIONAL INFORMATION Coal contract portfolio For personal use only COAL CONTRACT PORTFOLIO EXPIRY PROFILE1 FORECAST COAL CONTRACTED VOLUMES (MTPA)1 AS AT 31 DECEMBER 2019 250 0 - 3 years 238 229 9% 70 63 63 31% >3 - 7 years 60% >7 years 166 175 180 AS AT 30 JUNE 2019 0 - 3 years 1
Slide 65: Coal contract portfolio
1HFY2020 RESULTS ADDITIONAL INFORMATION Coal contract portfolio For personal use only AURIZON COAL CONTRACT VOLUME EXPIRY BY YEAR (MTPA – AS AT 31 DECEMBER 2019) 60 Contracted volume expiry Peabody extension / new volume Coronado extension / new volume 45 Million tonnes per annum 30 15 0 FY20 FY21 F
Slide 66: Additional information: Bulk
1HFY2020 RESULTS Additional information For personal use only Bulk
Slide 67: Bulk snapshot
1HFY2020 RESULTS ADDITIONAL INFORMATION Bulk snapshot As at 31 December 2019 For personal use only 24 167 HAULAGE BREAKDOWN1 million tonnes active locos 25% Bauxite/Alumina 48% Iron Ore Other2 27% >10 2,464 products hauled active wagons 1. Incorporates hauls that report tonnes, does not include Linf
Slide 68: Bulk operations – Queensland
1HFY2020 RESULTS ADDITIONAL INFORMATION Bulk operations – Queensland For personal use only 67
Slide 69: Bulk operations – Western Australia
1HFY2020 RESULTS ADDITIONAL INFORMATION Bulk operations – Western Australia For personal use only 68
Slide 70: Bulk profit & loss (underlying)
1HFY2020 RESULTS ADDITIONAL INFORMATION Bulk profit & loss (underlying) For personal use only $m 1HFY2020 1HFY2019 Variance 2HFY2019 Tonnes (m) 23.6 23.6 - 21.0 Total Revenue 297.3 259.5 15% 242.2 Total operating expenses (244.7) (236.8) (3%) (210.4) EBITDA 52.6 22.7 132% 31.8 Depreciation and amort
Slide 71: Additional information: Network
1HFY2020 RESULTS Additional information For personal use only Network
Slide 72: Network snapshot
1HFY2020 RESULTS ADDITIONAL INFORMATION Network snapshot As at 31 December 2019 For personal use only 117 40+ three above rail million tonnes mines serviced operators $5.6b five 2,670km Regulated Asset export terminals railway track Base1 HAULAGE BREAKDOWN2 1HFY2020 (estimate as at 30 June 2019) The
Slide 73: Central Queensland Coal Network (CQCN)
1HFY2020 RESULTS ADDITIONAL INFORMATION Central Queensland Coal Network (CQCN) CQCN comprises four major coal systems and one connecting system link (GAPE) servicing For personal use only Queensland’s Bowen Basin coal region 72
Slide 74: Network profit & loss (underlying)
1HFY2020 RESULTS ADDITIONAL INFORMATION Network profit & loss (underlying) For personal use only 1HFY2020 1HFY2019 Variance 2HFY2019 $m Tonnes (m) 116.6 116.5 - 116.2 Access Revenue 564.7 534.1 6% 536.2 Services and other 31.2 23.3 34% 24.1 Total Revenue 595.9 557.4 7% 560.3 Operating costs (201.2)
Slide 75: Network financial and operating metrics
1HFY2020 RESULTS ADDITIONAL INFORMATION Network financial and operating metrics For personal use only 1HFY2020 1HFY2019 Variance 2HFY2019 Tonnes (m) 116.6 116.5 - 116.2 NTK (bn) 29.0 28.8 1% 29.1 Operating Ratio 61.0% 63.6% 2.6ppt 64.8% Maintenance/NTK ($/’000 NTK) 2.2 2.2 - 2.4 Opex/NTK ($/’000 NTK
Slide 76: Network volumes
1HFY2020 RESULTS ADDITIONAL INFORMATION Network volumes For personal use only 1HFY2020 1HFY2019 Variance 2HFY2019 Newlands 7.2 6.5 11% 6.1 Goonyella 61.3 62.6 (2%) 61.9 Blackwater/WIRP 32.3 31.8 2% 33.1 Moura 6.2 7.0 (11%) 6.6 GAPE 9.6 8.6 12% 8.5 Total 116.6 116.5 - 116.2 Average haul length2 (kms)
Slide 77: Network – 1HFY2020 Access Revenue movement
1HFY2020 RESULTS ADDITIONAL INFORMATION Network – 1HFY2020 Access Revenue movement For personal use only $m $m Increase in MAR from 1HFY2019 to 1HFY2020 31.5 Reversal of FY2018 UT5FD True-Up from 1HFY2019 30.4 Rebates (primarily recovery of UT5 True-Up, rebates previously paid on Transitional Tariff
Slide 78: Network adjusted MAR bridge – Approved UT5 Undertaking
1HFY2020 RESULTS ADDITIONAL INFORMATION Network adjusted MAR bridge – Approved UT5 Undertaking Indicative Network adjusted MAR (Ex GAPE) for FY2019 to FY2023 based on the revised terms For personal use only of the UT5 Undertaking INDICATIVE NETWORK ADJUSTED MAR* FY2018 – FY2023 ($M) ~954 ~6 ~948 ~7
Slide 79: Network revenue adjustment amounts (revenue cap)
1HFY2020 RESULTS ADDITIONAL INFORMATION Network revenue adjustment amounts (revenue cap) For personal use only › Revenue adjustment amounts (RAA) are the difference by system between Aurizon’s Total Financial AT2-4 AT5 Total Actual AT2-5 Revenue and Allowable AT2-5 (diesel tariff) (electric tariff)
Slide 80: Reconciliation of billed MAR to reported access revenue
1HFY2020 RESULTS ADDITIONAL INFORMATION Reconciliation of billed MAR to reported access revenue For personal use only FY2020 FY2019 FY2018 $m Estimate* Actual Actual Billed Access Revenue (AT1 to AT5) (ex. GAPE) 950 885 940 Approved Adjustments to MAR Flood Claim recoveries1 - - 18 Revenue Cap (ex.
Slide 81: Regulated asset base (RAB)
1HFY2020 RESULTS ADDITIONAL INFORMATION Regulated asset base (RAB) Network maintains a record of the value of its existing assets for regulatory pricing called the For personal use only RAB ROLLFORWARD RAB › This represents the value of Network assets for regulatory purposes › Each year Network roll
Slide 82: Additional information: Capital Expenditure
1HFY2020 RESULTS Additional information For personal use only Capital Expenditure
Slide 83: Group and business unit capital expenditure
1HFY2020 RESULTS ADDITIONAL INFORMATION 1HFY2020 Group and business unit capital expenditure ($m) For personal use only 230 139 219 133 62 57 14 14 1 11 6 5 14 14 0 1 1HFY20201,2 Network1,2 Coal1 Bulk2 Intermodal Corporate Non Growth Growth 1. Includes capitalised interest 2. Net of externally funde
Slide 84: Glossary
1HFY2020 RESULTS ADDITIONAL INFORMATION Glossary For personal use only Metric Description Access Revenue Amounts received by Aurizon Network for access to the Network infrastructure under all Access Agreements AFD Access Facilitation Deed Average haul length NTK/Total tonnes Contract utilisation Tot
Slide 85: For personal use only
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