QR to spend its way to profit

National transport and logistics company QR has posted revenue of $3.5 billion in the 2007-08 fiscal year, up 11 per cent on the previous year, but said the result fell short of expectations.

It recorded net profit after tax of $194.5 million, a six per cent increase, carrying a record 245 million tonnes of freight.

QR chairman John Prescott said while the result was sound, returns were still inadequate to ensure the company’s commercial sustainability.

“Revenue was adversely affected by reduced production at mines in central Queensland after major flooding in the final six months of the financial year,” Mr Prescott said.

In a bid to lift its performance, the company spent a record $1.7 billion as part of its capital investment program, with a further $8 billion expected to be injected over the next five years.

“At a time of unprecedented levels of capital spending, QR is committed to improving its performance to achieve satisfactory returns for the people of Queensland,” he said.

Chief executive Lance Hockridge said the record spending in the year reflected its focus on safety improvements, commercial capability and growth opportunities.

“Strong improvements in these areas will genuinely position QR for long-term commercial success in a buoyant transport and logistics market, which is undergoing major transformation.”

The company carried a record 245 million tonnes of freight, while delivering $900 million of new infrastructure for the passenger and freight networks, a 300 per cent increase over two year.

“We are well positioned any very focussed to meet the challenges posed by the dramatic population growth in south-east Queensland and to seize the opportunities arising from the resources boom in Queensland and Western Australia, as well as the strong growth of the general freight market,” Mr Hockridge said.

He said QR’s restructure into freight, network, passenger and services this year was enhancing its customer focus, with new management appointments providing the desired combination of commercial capability and rail industry experience.

“We are reshaping and rebuilding the ‘new QR’ to fulfil our vision of becoming the leading transport and logistics company in the country,” he said.

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