Asciano to slash 500 jobs by the end of June

Rail and ports company Asciano will slash 500 jobs by the month’s end as it aims to save $90 million.

The cuts come as Asciano ramps up its “business improvement program”, which was originally forecast to save the company $150 million by 2016.

However this has now been doubled, with a total of $300 million in savings the new benchmark.

In February the company announced 100 job cuts would affect Pacific National workers after merging the business with its PN Rail division.

Asciano said strong volume growth in coal and container volumes combined with cost cutting measures had offset weaker volumes in export grain and bulk ports.

“The increase in the business improvement program and accelerated cost out should drive earnings growth in FY15 at a higher rate than FY14 despite current expectations for ongoing soft top line growth,” the company said.

Asciano said it was mulling small acquisitions in bulk ports and logistics but would hold off on large-scale purchases in line with its five year plan.

The company said it expects to report low single digit growth in its underlying net profit after tax in FY14.

It said material items for the year are expected to be in the range of $120 – $130 million, up from $15-$20 million.

It said rail integration costs in the form of employee redundancies would cost the company $25-30 million.

While non-cash costs of around $75 million are expected in the write down of assets associated with the redevelopment of Port Botany and in the value of rolling stock.

To keep up to date with Australian Mining, subscribe to our free email newsletters delivered straight to your inbox. Click here.