Frieght rail operator Aurizon has written off its investment in Aquila Resources and said it was shedding about 300 jobs in response to weakening coal prices.
The company plans to cut approximately 180 workers in train crews, yard operations, maintenance and infrastructure production, plus about 120 middle and senior managers.
Aurizon also announced an additional $73 million impairment against its investment in Aquila Resources, due to the company’s deferral of the development of its coal assets.
The announcement comes off the back of proposed job cuts at its Callemondah, Jilalan and Pring depots.
According to Chief Executive Officer Lance Hockridge, those in leadership positions in operations, representing approximately 20 per cent of management roles have been affected.
“Clearly we’re operating in a tough and volatile market with lower growth conditions for our customers,” managing director and chief executive officer Lance Hockridge said yesterday.
“In this environment, we are targeting further reductions in our cost base and finding new ways to drive asset and labour productivity.”
“Work is underway across the company, in reducing management roles, in driving down corporate and support costs and ensuring workforce numbers are aligned to forecast customer demand,” Mr Hockridge said.
Although Aurizon’s underlying earnings were within guidance at $871million, it had $528 million worth of impairments in 2016.
With the downturn in full effect, Aurizon reported the amount of coal, iron ore and freight it hauled would be down on last year’s tonnage of 211 million tonnes.
The company expects to haul 206.8 million tonnes of coal this year compared to last year’s 211 million tonnes.