Qube flags $128m impairment ahead of FY25 results
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The news: Logistics business Qube has flagged a $127.6 million impairment on its joint venture interest in Moorbank Interstate Terminals (MITCo), reducing its carrying value to nil, as well as other material adjustments relating to the project, according to a preliminary assessment.
The numbers: In addition to the non-cash impairment on Qube’s 65% interest in the joint venture, a fair value reduction of $29.8 million has been taken on the “most of the balance of the volume-based milestone amounts receivable from ESR” relating to its 25% interest in MITCo that was acquired from Qube.
Onerous contract and other liabilities related to the forecast cost increase to stage one of the Moorebank Interstate and related rail access works of $62 million, although the cash expenditure for this is expected to be incurred between FY26 and FY29. The bulk will be taken between mid FY27 and late FY28.
Qube also received a profit of around $89.7 million from the sale of its freehold property in Minto, New South Wales. Gross cash proceeds received in the second half of FY25 from the sale were $201.7 million.
The context: Qube’s adjustments stem primarily from its obligation to manage the construction of stage one of the terminal and to initially fund stage one construction, “combined with weak medium to long term volume outlook for the [Moorebank Logistics Park] interstate”.
This announcement is not expected to affect underlying earnings, with Qube reiterating previously announced guidance that underlying earnings for FY25 are expected to be in the range of at least 5% above FY24.
The source: ASX
