Australia's transport companies to feel biggest impact under carbon tax: analysis

16:55, July 12, 2011      

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Early analysis by investment bank UBS on Tuesday said Australia's transport and building materials companies are likely to feel the biggest earnings impact from the carbon tax.

Prime Minster Julia Gillard on Sunday released the details of carbon tax scheme, saying that the 24.8 U.S. dollars a ton carbon tax will start from July 1, 2012.

Petrol prices for ordinary motorists will not be affected, but road transport above 4.5 ton will start paying the tax from 2014- 15.

ABC News reported that UBS' early analysis report estimates Virgin Airline will suffer one of the biggest impacts on earnings per share (EPS) in the 2013 financial year of 24.5 percent, while Qantas would see its EPS down 14.1 percent.

However, the figures do not include the effect of passing on the tax to customers, with both companies have indicated they will pass all of their carbon costs into higher ticket prices.

Due to the reduction of the fuel excise rebate for businesses under the carbon tax scheme, transport companies, Asciano and QR National, are forecast to see EPS fall 6.6 and 4.9 percent respectively.

Meanwhile, building materials companies are also significant carbon producers, and the UBS report expected that the carbon pricing would have an impact of between 1.5-6.7 percent on EPS, if the increase of running-cost were not passed on to customers.

UBS estimates the EPS impact on Macarthur Coal at 3.9 percent next financial year and 7.7 percent the year after.

The impact on diversified global miners is expected to be far less, with BHP Billiton to see a 0.9 percent earnings hit, and Rio Tinto a 1.9 percent fall in FY2013 EPS.

Source: Xinhua
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