KiwiRail releases 2015 Annual Report
29 October 2015 10:10AM
KiwiRail’s 2015 Annual Report reflects a year of recovery and consolidation for the company as it maintains its focus on simplifying and improving the business, Chief Executive Peter Reidy says.
“KiwiRail is a large, busy and complex business. About 900 freight trains a week run on sections of our 4000km of track. The track itself has more than 1500 bridges and 150 tunnels. In addition, TranzMetro provides more than 12 million passenger journeys a year in Wellington, while our network enables about 13 million passenger journeys in Auckland. Meanwhile, Interislander ferries together cross Cook Strait about 4500 times a year.
“Our 4000km network makes this a business with high fixed costs and it is likely to always require Crown investment. We are engaged in implementing a strategy that we anticipate will reduce the level of Crown support required on this infrastructure over time,” Mr Reidy says.
“We are continuing to simplify our operating model and standardise our assets, particularly to make it easier for our customers to switch their freight between road, rail and ships. We are investing in staff training including a High-Performance High-Engagement strategy with our staff and unions. Our safety performance has significantly improved. Mainline derailments have noticeably reduced.
“We are pleased to have recorded a 17 per cent improvement in our operating surplus in 2014/15 to $91 million, despite revenue falling by 3 per cent.
“We are continuing to look at our expenditure, particularly where we provide services in areas of low demand with little prospect of improvement.
“Accounting measures are one important way to evaluate the company but KiwiRail’s value also lies in low carbon emissions relative to road transport, and reducing congestion on roads. It is estimated that without rail freight services, 1.4 million additional truck journeys would be required. Our freight fleet is largely diesel, but emits less than 0.2 per cent of New Zealand’s total carbon emissions.
“We look forward to making progress with the NZ Transport Agency on an integrated land transport strategy that makes optimal use of investment in transport infrastructure and that values rail’s contribution to moving freight and people.
“While market conditions are challenging, particularly for bulk dairy and forestry products, by committing ourselves to this programme of change, we believe we can improve the company’s performance for customers, shareholders and taxpayers.”
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