TRANSPORT

The division, known as Ferrocarril de Antofagasta a Bolivia (FCAB), provides rail and truck services to the mining industry in the Antofagasta Region. The transport division operates its own railway network, with access to Bolivia and the two largest ports in the region at Mejillones and the city of Antofagasta. The port at Antofagasta is managed by Antofagasta Terminal Internacional (ATI), which is minority-owned by the Group.

2017 PERFORMANCE

During the year, the transport division further optimised its business under the FCAB Management Model based on the three key areas of sustainability, productivity and cost management. Tonnage transported continued in line with the previous year and the railway renewed an acid and cathode transport contract with one of its largest customers. Additionally, the FCAB was awarded a new concentrates transport contract, confirming the competitiveness of its cost structure. Furthermore, in early 2018 an additional acid, cathode and concentrates contract was awarded to FCAB. Seven new locomotives purchased during the year are scheduled to begin operating the first half of 2018, and another five locomotives have been ordered, optimising the fleet and increasing asset productivity. 

Operating performance

The division’s EBITDA was $98.1 million in 2017, compared to $87.7 million in 2016, reflecting appropriate cost management and higher sales from the water business.

Transport tonnage

During 2017 the division transported 6.3 million tonnes, compared to 6.5 million tonnes in 2016, 3.5% lower mainly due to labour disruptions at one of the division’s clients, partially offset by higher road transport volumes and productivity improvements achieved during the year.

Costs

Cost management was focused on optimising the division’s business processes to ensure the lasting competitiveness of its services through better utilisation of the fleet, organisational changes and cost savings.

OUTLOOK

The division will continue to develop new business opportunities and optimise the use of rolling stock and utilisation of the fleet. Improvements are expected in maintenance, using knowledge gained from the mining division and best practices from the railway industry, and benefiting from the new locomotives and higher fleet availability. This is the beginning of a renewal programme of FCAB’s locomotives fleet. The implementation of the Costs and Competitiveness Programme will further help to keep costs under control. One of the main areas of focus in 2018 will be the development of projects to service the two new transport contracts. Once these are in place in 2019, FCAB’s transport tonnage will increase by about 10%.

Explore our approach to sustainability