March 2016 Quarterly Above Rail Volumes

– 0.00 0.0%

21 Apr 2016

Overview:

Overall Above Rail volumes were stable during the quarter, consistent with guidance, with high contract utilisation continuing (Coal 91%, Iron Ore >100%)

Coal:

FY2016 coal volume guidance remains 204-209mt
March Quarter 2016 volumes of 49.4mt were flat(-0.2mt) compared to the previous corresponding period (pcp) against a 4% increase in NTKs
On 14th March 2016, Aurizon secured a long-term contract extension with Coal customer BHP Billiton for its Mt Arthur Coal mine in the Hunter Valley to June 2028 allowing for a potential increase in coal haulage volumes from 18 mtpa up to a maximum of 26 mtpa
On 13th April 2016,Peabody Energy Corp. filed for Chapter 11.No Australian Peabody entities were included in the filings.Aurizon continues to haul for Peabody Energy Australia with mine and rail operations continuing as usual
On 20th April 2016, Aurizon renewed its contract with Sojitz for haulage from the Minerva mine for up to 5 years and 2.4mtpa

Queensland (QLD):

March Quarter 2016 volumes were in line with the pcp at 38.8mt (-0.1mt) with more favourable weather in the current quarter offsetting the weaker volumes in the Goonyella corridor due to increased railings by BMA Rail and the impact from the closure of the Gregory Southmine in the Blackwater corridor
Net Tonne Kilometres (NTK) increased 1% compared with pcp due to increased volumes in the Moura system reflecting weather impacts in the pcp

New South Wales (NSW):

March Quarter 2016 volumes of 10.6mt represents a 1% (-0.1mt) decrease compared to the pcp, with the ramp up of the Whitehaven contract (commenced 1st March 2015)offset by reduced production by a key customer
NTKs increased 16%, reflecting the longer haulage distances associated with the Whitehaven volumes from the Gunnedah Basin.The 4th Whitehaven Coal consist commenced operating on 7th March 2016

Iron ore:

March Quarter 2016 volumes were 6.0mt in line with FY2016 guidance of stable volumes (vs. 23.9mt in FY2015)
NTKs decreased 3% in line with the decrease in volumes

Freight:

March Quarter 2016 volumes of 9.3mt represents a 1% (-0.1mt) decrease compared to the pcp:
- Bulk volumes were in line with the pcp despite the reduced QNI volumes due to the refinery being placed in to care & maintenance and the impact from the Mt Isa line derailments in North QLD
- Intermodal Twenty-foot Equivalent Unit (TEU) volumes decreased 1%reflecting soft market conditions. Stronger North-South interstate volumes (up 6%) following the entrance into the refrigeration market,were offset by lower East-West volumes. North coast line corridor volumes were negatively impacted by the loss of Cement Australia contract,low cattle stock and the longer than expected shutdown of abattoirs
Overall Freight NTKs decreased 4% driven by a decline in East-West volumes and product mix
Freight customer QNI ceased production with the refinery placed into 'Care & Maintenance' with Aurizon ceasing to rail on 10th March 2016
During the quarter, Aurizon secured 5-year contracts with West Australian Freight customers Australian Gold Reagents (sodium cyanide) and Cockburn Cement Limited (lime and cement)
Operations at the Enfield Intermodal Terminal in Sydney will commence on 9th May 2016, allowing the business to grow and expand its interstate service offerings and opening the opportunity to provide port shuttle services in the future