KiwiRail, the state-owned rail and freight operator, widened its loss in 2018 with further writedowns to its rail network, even as revenue and underlying earnings gained.
The Auckland-based state-owned enterprise reported a net loss of $235.9 million in the year to June 30 versus a loss of $197.3m in the prior year.
That reflected an impairment charge of $248.6m on KiwiRail's rail assets, down from $295.8m.
As the rail network does not generate sufficient cash to cover the level of required investment, a large proportion of the accounting value must be written off each year, it said.
Earnings before depreciation, amortisation, interest, impairment, capital grants and fair value changes fell 7.1 per cent to $48.5m, weighed down by a $45m hit from the Kaikoura earthquake. Stripping out the quake impact, underlying earnings rose 2 per cent to $94m, while operating revenue gained 3.5 per cent to $615.8m.
"KiwiRail has really put in the hard yards to re-energise the business over the past four years and despite the challenges nature has thrown at it, it is now primed for growth and ready to deliver for New Zealand," said acting chair Brian Corban.
"Even through this difficult period, KiwiRail has achieved productivity initiatives to the tune of $7m and invested $9m more in capital expenditure than the prior year (excluding Kaitaki ferry purchase), primarily in rolling stock replacement as we seek to renew our ageing locomotives and wagons."
The 2018 financial year saw KiwiRail lift revenue across all divisions, with a 1.5 per cent gain in freight to $350.7m; a 5.2 per cent increase from the Interislander to $137m; a 5.8 per cent lift from infrastructure to $52.5m; and a 5.1 per cent increase from property to $45.1m.
Its scenic division, which covers tourism, boosted revenue 21.9 per cent to $27.8m in the year. Kiwirail said freight volumes in forestry rose 12 per cent in the year, and bulk freight lifted 6 per cent.
"These gains are despite the ongoing challenge of the Main North Line railway between Picton and Christchurch still closed for daytime freight services while the recovery work from the 2016 Kaikoura earthquake continues," Corban said.