Business performance
How we measure financial performance
Free Cash Free Cash is the primary measure used to assess the cash performance of the Group and generally represents the cash available for distribution to security holders. Free Cash is calculated in Note B9 of the Group financial statements. Changes to Transurban’s Free Cash definition will be introduced in FY25 (read more on page 49). Proportional EBITDA We consider proportional earnings before interest, tax, depreciation and amortisation (EBITDA) to be the best measure of underlying business performance. Proportional EBITDA aggregates the results from each asset multiplied by Transurban’s percentage ownership as well as the contribution from central Group functions. Proportional EBITDA reflects the contribution from individual assets to the Group’s operating performance and focuses on
elements of the result that management can influence to drive improvements in earnings. Note B4 to the Group financial statements presents further detail on the proportional results for the Group, including reconciliations to the statutory result. Traffic performance FY24 saw Group traffic grow in all markets, up 1.7% for the year. The post-pandemic trend of weekend traffic growth stabilised throughout the year, with weekend traffic up 1%, while weekday traffic was stronger, up 2% across the Group. Large vehicle traffic remained resilient, up 0.6% for the year, despite some softness in NSW and Queensland. Construction of new motorways continues to impact volumes in Melbourne and Sydney, however we expect these projects will ultimately boost traffic when completed in the coming years.
Traffic growth was particularly strong in North America in FY24, with ADT increasing by 5.5% to 157,000 trips. This growth is underpinned by the opening of the Fredericksburg Extension, which is still to see annualised benefits. Delivering for investors Transurban distributed $1,916 million to security holders in FY24. Alongside this, we continued to invest in the long-term growth of the business, progressing our pipeline of projects and evolving our operating model to take advantage of strategic opportunities. Throughout FY24, we continued to actively manage our balance sheet, with our weighted average cost of debt up slightly at 4.5%. And our disciplined and active approach to cost management saw cost growth of 3.6%, outperforming guidance of 4–6% growth. Longer term, forecast population and employment growth in all of our markets is expected to support ongoing traffic momentum.
Responding to evolving sustainability reporting requirements
The last decade has seen a rapid evolution in the way organisations report on their sustainability approach and performance to investors.
The launch of the International Sustainability Standards Board’s inaugural standards – IFRS S1 and IFRS S2 – will transform the way companies consider and report on sustainability risks and opportunities in their business. Importantly, these global standards – and their application across jurisdictions – will provide investors with a harmonised baseline for investor-focused sustainability reporting that integrates financial and non-financial data. The global adoption of these standards will require organisations to formally integrate their material sustainability risks and opportunities into the governance, strategy, risk management and performance of their business.
Australian companies will be guided by the Australian Sustainability Reporting Standards (ASRS). The proposed standards were released by the Australian Accounting Standards Board in October 2023. Mandatory reporting is expected to commence for Transurban from 1 July 2025, with a climate-first focus. To prepare for our climate-first reporting obligations, we have developed a detailed ASRS Readiness Program, which will build on the solid foundation already in place through our previous TCFD disclosures. We have also conducted a materiality review to determine our most material ESG topics (see pages 8–9). Recognition is growing globally about the importance of nature to the economy and the risks associated with accelerating nature and
biodiversity loss across the globe. The investor-led Taskforce for Nature-related Financial Disclosure (TNFD), which is aligned with the TCFD framework, was launched in September 2023. Currently voluntary, TNFD provides recommendations and guidance to organisations to help assess, report and act on their nature-related dependencies, impacts, risks and opportunities. We also understand that ‘nature, biodiversity and ecological systems’, along with ‘human capital’ will be the next priority focus areas for ISSB standard development, which is expected to result in IFRS S3 and S4 respectively in the coming years.
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