Higher charges help lift Transurban revenue

The toll road operator has revealed that a plan to refresh the board is in the works, as it reported a jump in revenue.

Melbourne’s CityLink — Transurban’s single biggest revenue provider.

Transurban chairman Lindsay Maxsted has told investors a succession plan for board renewal is in the works as he seeks re-election at the toll road operator’s AGM today.

Mr Maxsted, who has served on the board for eight-and-a-half years and as chairman for six, said he was unlikely to serve another full three-year term as a successor is sought.

“In relation to my tenure, if re-elected today, it is possible that as part of orderly succession planning for the board, and in acknowledging that I am the longest-serving director, I may not serve a full term of three years,” he said.

“Succession has been an item on the board agenda for some time now as my tenure and the tenure of certain other board members approaches nine years. An orderly and co-ordinated succession plan for the next two to four years is in development.”

The high-profile Mr Maxsted is also on the boards of BHP Billiton and Westpac, two of the nation’s five biggest companies.

As part of its plans for renewal, Transurban is on the lookout for a new director to expand the board to nine members, with an appointment expected “shortly”.

The commentary came as the toll road operator reported a 10.8 per cent jump in underlying revenue through the first quarter, with higher charges and improved traffic combining to lift sales.

The September quarter update revealed traffic growth of 4.9 per cent across its broad network, which includes major roads in Melbourne, Sydney and Brisbane.

The lift in traffic combined with higher toll road charges to lift toll revenue 12.3 per cent to $513 million, while proportional toll revenue — which provides a fairer comparison to prior quarters — rose 10.8 per cent to $529m, as against the September quarter last year.

“This growth was supported by a range of factors including capital investment to expand capacity, investment into network management technology, improved safety due to incident response changes and operation and maintenance practice refinements,” the company said.

Transurban (TCL), the nation’s largest operator of toll roads, reaps its greatest revenue in Sydney, where proportional toll numbers showed a 7.9 per cent rise to $212m despite a more modest 3.4 per cent lift in average daily traffic.

In Sydney, the group controls the M2 and Cross City Tunnel, as well as part-owning the M7, M5 and M1.

Its Melbourne home base provides its single biggest revenue provider in the high volume CityLink toll road, which booked a 2.6 per cent gain in proportional revenue to $169m. The number, which represents its entire Melbourne operation, came despite a 0.5 per cent fall in average daily traffic as the $1.3 billion CityLink Tulla widening project caused disruptions.

Elsewhere, Transurban’s Brisbane toll revenue surged 30.6 per cent to $97m on a 19.4 per cent rise in traffic, while its toll roads in the Washington area delivered a 24.1 per cent lift in revenue to $US38m ($50.2m) on an 11.5 per cent rise in traffic.