Asciano group expects A$1.1 billion write down in H2. Minerals Council of Australia to engage government on proposed super profit tax. Budget proposals are to be presented in parliament tonight.
3:00 AM New York, 7:00 PM Sydney – Asciano group expects A$1.1 billion write down in H2. Minerals Council of Australia to engage government on proposed super profit tax. Budget proposals are to be presented in parliament tonight.
The Australian stock index fell 1.1% despite a morning rally in financial stocks as investors continued to worry about the impact the proposed 40% tax on resource company’s profits.
The Australian and New Zealand dollars fell for the first time in three days against the yen after concern that a bailout loan of near $1 trillion may not end fiscal crisis being faced by some debt-laden European governments.
Demand for these currencies weakened versus the greenback after European Central Bank President Jean-Claude Trichet said yesterday that the loan package was not supported by all 22 members of its Governing Council members.
The Minerals Council of Australia plans to meet treasury officials this week for talks on the proposed super profit tax, council spokesman Ben Mitchell said over phone today. The meeting is scheduled to be held on May 13 in Canberra, he said.
More than 80 mining companies have registered for talks with the government on the proposed tax, Sydney Morning Herald reported, citing Treasurer Wayne Swann. Companies may boycott the process if the government refuses to discuss the merits and design of the proposal, the paper said, citing industry sources.
Xstrata Plc, the world’s largest exporter of thermal coal, placed all its projects in Australia under review, adding pressure on the government to tone down its proposed 40% tax on mining profits.
Meanwhile Prime Minister Kevin Rudd, whose approval rating has tumbled below 50% hopes to use tonight’s budget to remind voters that he has spurred economic growth without resorting to debt that has fuelled the financial crisis enveloping Europe.
Paladin Energy Ltd, the Australian uranium producer, climbed for the third day today after saying a unit of Canada’s Uranium One Inc, increased its stake to about 3%. Uranium One Inc had said in a quarterly conference call on April 30, that it had increased its stake from 1.6% held previously, Perth-based Paladin said in a statement to the Australian Stock Exchange.
The volume of coal exported from Dalrymple Bay in April was 6.01 million tons, the highest since July, North Queensland Bulk Ports said on its website today. Exports from Newcastle port in New South Wales fell 2.7% last week, said Newcastle Port Corp on its website today.
Dalrymple Bay, owned by Prime Infrastructure Group, handles coal from as many as 18 mines in the Bowen Basin region of Queensland including some customers like Rio Tinto Group and Xstrata Plc.
In Sydney trading ASX 200 Index fell 1.1% or 51.8 to 4,548.00.
Of the ASX 200 index stocks, 54 gained, 138 fell, and 8 were unchanged. Eastern Star Gas led decliners in the index with a fall of 6.8% followed by Energy World Corp. 6.3%.
Other commodity stocks declined. Fortescue Metals tumbled 5% to A$4.16 and Gindalbie Metals slipped 5% to A$1.14.
The Australian dollar declined 0.8% to 89.57 U.S. cents.
Asciano Expects A$1 billion Write down in H2
Asciano Group reported today that following the recommendations of the Audit and Risk Committee, the company completed its annual impairment testing and expects that pre-tax impairment charges to rise to A$1.1 billion in the second half to June 2010.
The amount comprises an impairment charge of A$960 million related to goodwill in the Ports businesses – A$$760 million relating to goodwill in the Patrick Container Ports division largely attributable to changes in the long-term assumptions of this business; A$150 million relating to goodwill in the Patrick General Stevedoring division; and A$50 million relating to the goodwill in Patrick Autocare.
In addition, the writedown includes the impairment of other assets totaling approximately $150 million – including A$120 million relating to tangible assets, and $30 million relating to intangible assets such as customer contracts and associated relationships inherited at the time of the Toll-Asciano demerger.
Asciano Managing Director and Chief Executive Officer Mark Rowsthorn said the write down “is a non cash item and the overall enterprise value is not affected by the impairment due to the increase in value in other parts of the business which under accounting standards are unable to be written up”.
