KiwiRail has reported a $15.1m drop in services external operating revenue in the six months to 31 December 2024.
The New Zealand operator said the fall in its bottom line reflects a subdued domestic economy, changing import flows, a delayed lift in seasonal export volumes and the impact of one-off network outages.
Services external operating revenue was $359.9m, with services operating surplus decreasing to $25.8m, $14.7m behind last year.
On top of the challenging commercial environment, one-off impacts included losing freight volume as a result of the closure of Winstone Pulp International (WPI), the Tawhai tunnel collapse, a delayed start to re-opening the North Auckland Line which was damaged by Cyclone Gabrielle and redundancy payments.
Overall, rail freight net tonne kilometres were down seven per cent over the half year, consistent with the general freight market reduction of seven to 10 per cent. Normalising for one-off events, KiwiRail’s freight volume was down two to three per cent.
KiwiRail Acting Chair Rob Jager said: “As a key part of New Zealand’s supply chain, KiwiRail quickly feels the impact of any economic downturn.
“However, we are working hard internally and with customers to improve our service levels and to ensure that when confidence returns to the economy, we are in a position to attract more freight to rail.
“The reinstatement of the North Auckland Line after Cyclone Gabrielle and Fonterra’s return to rail, the steady long-term demand outlook for dairy and forestry, and the reinstatement of Tawhai tunnel and resumption of the coal programme are all positive.”
KiwiRail Chief Executive Peter Reidy said that throughout HY25, KiwiRail helped its customers deliver through a tough period.
“KiwiRail will grow by winning customer loyalty,” Reidy said.
“That means delivering consistent superior customer service and improving operational excellence so we can be more competitive in the market.”
In the last six months of 2024, KiwiRail also focused on its multi-year transformation programme to reshape the business so it increases productivity and better meets the needs of customers and the expectations of shareholders.
“Our transformation initiatives are happening all across the company and saved $20m in the six months to 31 December,” said Reidy.
“We are committed to maintaining the momentum and achieving ongoing savings.”
KiwiRail’s Half Year Report 2025 is available to read online.
