20 Feb 2019

Kiwirail halves its losses, but still at risk

4:29 pm on 20 February 2019

KiwiRail has posted a reduced half year loss as it recovers from the Kaikoura earthquake and improved its revenue from tourism and freight.

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KiwiRail made a net loss to $104.6 million from $193m the previous year. Photo: Flickr

The state-owned enterprise made a net loss to $104.6 million from $193m the previous year.

However, its underlying earnings, which strip out the cost of maintaining and running the rail network, was up seven percent to $16.1m.

"It will take some time to get back to where we were before... the quake but we are seeing increased demand in this result," chair Greg Miller said.

Revenue was $328.8m, compared with $292.8m, with sales driven by a 30 percent rise in domestic freight revenue, and increased earnings for the Interislander ferries and on its tourism trains.

Mr Miller said it was grappling with higher costs, more compliance and ageing assets.

"KiwiRail is dealing with a legacy of under-investment from successive governments and our infrastructure still requires a lot of work to bring it up to a modern transport standard so we can really deliver what we are being asked to deliver."

He said future developments include reopening the Napier-Wairoa line for timber traffic, an extension to Northport, and a new Hamilton-Auckland commuter service.

Kiwirail received $34.9m in capital grants over the period more than double the year before.

"The government has seen we are in catch-up mode and is willing to invest for the good of New Zealand."