Ports and rail operator Asciano has predicted earnings growth for all of its business divisions this year, despite the spectre of a waterfront war and sluggish global economy.
Asciano on Wednesday reported that full year profit was up by 43 per cent to $242.7 million, despite the effect of industrial action on its business.
A month-long strike at the Port Kembla coal terminal in New South Wales was estimated to have cost Asciano $3 million, while drawn-out negotiations for a new enterprise agreement for its ports workers cost $21 million, the company said.
Chief executive John Mullen said the business environment would probably remain more difficult than he and his customers would like in 2013 but forecasts for the longer-term were still good.
No specific financial guidance was provided.
“We are confident in continued strong growth in earnings and revenue,” he said in a teleconference.
“Each of Asciano’s core divisions are operating in industries with short-term fluctuations but we believe show good long-term fundamentals.”
Coal exports would continue despite recent weaknesses in prices and that goods would need to be transported around the country to bulk ports, he said.
“It is just a part of those mini-cycles that we see inside these commodity markets … if you step back from the month-to-month perspective and look at six- to 12-month trends, the underlying consolidated rate of growth year on year is quite reliable,” he said.
Mr Mullen said he was confident of heading off a dispute on the wharves with the Maritime Union of Australia despite its threats of legal action and an international campaign against plans to cut 270 staff and replace them with machines.
“We have to be ready for it but we are not anticipating prolonged, material industrial action,” he said.
Asciano’s Patrick ports division will soon operate in a more competitive environment, with the looming arrival of newcomer Hutchison Ports joining the current duopoly with DP World.
Patrick boss Alistair Field said he believed the division had the competitive advantage to be the “stevedore of choice” and outcompete and be better than Hutchison in chasing coal and other contracts.
Earnings from Asciano’s Pacific National rail businesses and its ports and logistics businesses rose due to contract wins and measures to restructure underperforming areas of its operations, Mr Mullen said.
“I am extremely pleased with this result, both as a standalone result but also in light of the challenging operating environment we have experienced over the last 12 months,” Mr Mullen said in a statement.
Asciano declared a fully franked final dividend of four cents per share, up from three cents for the same period in the previous year.
The company’s share price closed up one cent at $4.51.
