KEY POINTS:
As Toll NZ disappears from the New Zealand stock exchange, its Australian owners are more positive about the company's future than they have ever been.
"The way ahead is filled with opportunity and potential," Toll NZ chairman John Ludeke tells shareholders in the last annual report that will
be sent to them.
Toll Holdings of Australia has moved to 100 per cent ownership of Toll NZ, the former Tranz Rail, and the shares are currently suspended awaiting delisting.
While the company is yet to clinch an agreement for long term access fees to the government owned rail network it is positive that it will.
The company's upbeat tone in its last annual report is a stark contrast to the prediction in a rail industry magazine this month that Toll may be pulling out of New Zealand frustrated with the government and profits it is making here.
"Our wish to expand in New Zealand is no secret, and the timing is now right,"said Mr Ludeke, a long serving executive at Toll Holdings.
He cited the "expected" announcement of a track access deal with the government as a factor in this optimism.
"Progress with the Crown has been slow, and while it is regrettable that in the year under review, negotiations failed to produce a final agreement, since balance date there has been further advancement," he said.
"We remain optimistic that in the near future we will have an agreement in place that ensures the viability of the national rail network and allows for certainty for future rail investment."
He said Toll would make the necessary investment in rail if it had certainty from an access agreement.
The latest set of accounts records $48 million of rail access fees, which is believed to be well below what it costs to maintain the network. Toll NZ has exclusive access to the network for freight trains, making it essentially the only operator other than a rival running Auckland passenger trains and groups that operate rail excursions.
Mr Ludeke, who has been involved with Toll NZ since Toll Holdings took control in 2003, said he hopes there would be a revival in rail for the sake of New Zealand's infrastructure.
The way ahead was "filled with opportunity and potential", he said.
The annual report also shows that Toll managed to make a profit on the sale and lease back of the Spanish-built Cook Strait ferry Aratere, dubbed as "el Lemon" before Toll put it into dry dock and fixed some of its problems.
As well as putting in one of its key management employees David Jackson to run Toll NZ, Toll Holdings also replaced the banks that were shutting down lending to Tranz Rail when it nearly collapsed.
The loan facility to the parent Toll Holdings is reduced to $250m in the latest accounts from $300m and the facility charges a margin of 1.5 per cent over bank bill rate.
The 2007 accounts include a note referring to ten year deal with a major customer in May 2003 that Tranz Rail got an upfront payment of $2.5m from presumably to help resolve its then serious cash flow problems.
Mr Ludeke said it is now an exciting time for Toll NZ.
The delisting, due soon, would be another step in the company's continued positioning for expansion.
- NZPA
