Rail Observations 2023

[alleve]

At Edgecliff last night, was informed by Sydney Trains staff that rail replacement buses had not been ordered and that the only way to Bondi Junction was a 326 coming in an hour. Every 324/325 passing Edgecliff was packed.

Now I'm on a T4 train that's been stuck outside Redfern for close to 40 minutes now.

Gotta love Sydney Trains.

[Fleet Lists]

At Edgecliff last night, was informed by Sydney Trains staff that rail replacement buses had not been ordered and that the only way to Bondi Junction was a 326 coming in an hour. Every 324/325 passing Edgecliff was packed.

That would not surprise as alert 13883 which covered the definition of the three Eastern Suburbs routes concerned 20T4, 23T4 and 25T4 was headed as covering replacement services between Cronulla and Sutherland which covered route 33T4 on the same date 10/3/2023 which in the description covered route 33T4 as well as the 3 Eastern Suburbs routes. The latter section appeared to be a duplicate of alert 13885 except for the date. The recipients of these alerts for the ordering of buses and creation of timetables probably thought the part in 13883 was duplication of13885 and ignored it.

[ScaniaGrenda]

No mention on its Twitter feed per usual, don’t know why they bother having.

Their communication is a farce & when S#%t hits the fan all they can offer is "well, better find your own way around". As both a regional and also sometimes intercity Traveler there is not going to be an alternate means of getting me to to my destination if they don't have replacement buses running. We don't have the luxury of having the equivalent of the 600 (Former M60) for example that would run from a couple of train station all the way to a Cities Business District or City at all. I know something like that isn't a sustainable alternative but it's still an alternative.

No replacement buses = no way of myself getting to / from the city unless I want to drive and add another car onto the road. Hence why I've always been so vocal that we really need a route that could run from a couple of train stations to at least the Cites Business district that way if the train goes kaput your not stranded nor waiting to see if Sydney trains / Trainlink will get their act together and at least try to organise replacement buses.

[Linto63]

Can understand that wires down at Panania would impact the T8 line, and to a lesser extent the T2 and T3, but how this is causing major delays on the T1 and T4 is beyond me. This is the reason being given on announcements.

[Randomness]

Probably:
- Someone reported earlier, a signal failiure at Central

- T4/SCO trains:
> Going around an already packed City Circle
> Are being made up of some North Sydney terminaters because of Lidcombe trackwork

- There was a conga line of about 12 T3/8 trains waiting to get into Central also this morning which maxed out the City Circle
> This probably got in the way of T1 trains because signallers prefer making other trains late to get an already late one less late

- Trains stationed at Leppington not being able to shunt in and out fast enough (and possibly crew going over max driving time as a result)

[boxythingy]

complete shambles, caught the train out thinking that trains resumed via Panania after 7. On the way home was told that the next down direction train would not come until 1 hours time at Glenfield "interchange" station

[Linto63]

Equipment that crippled Sydney train network obsolete for more than a year (Sydney Morning Herald)

[boxythingy]

Did not know this was operationally feasible, dropping off a staff member at a non scheduled stop on a Southern Highlands Line service
https://youtube.com/shorts/jryuzYp0-4Y?feature=share

[Glen]

Just be thankful they don't do it at Flemington Car Sidings like they used to all the time!

[boronia]

Quite feasible if there is a platform there; whether it is acceptable practice is a different question.

[Stonesourscotty]

Movember liveried 8239 parked outside Mcdonaldtown Station.

[boronia]

Movember liveried 8239 parked outside Mcdonaldtown Station.

What sort of train is it?

[Randomness]

82 Class freighter. I might've seen it or another at Clyde yard on Thursday.

[boronia]

Presumably it is parked AT McDonaldtown Station then? Probably on trackwork?

[boronia]

Here we go again:

Sydney trains hit with major delays due to urgent signal repairs

https://www.smh.com.au/national/nsw/maj ... 5cv8h.html

[boronia]

Raft of work on Sydney’s stricken rail network halted for weeks, workers redeployed

https://www.smh.com.au/national/nsw/raf ... 5cwb4.html

[boronia]

Review of Sydney’s troubled railway to investigate failures after year of disruptions, delays
https://www.smh.com.au/national/nsw/rev ... 5cwtc.html

[boronia]

https://www.smh.com.au/business/compani ... 5cwjr.html

Scandals put Downer EDI at risk of break-up

[Fleet Lists]

Unfortunately this article is for subscribers only.

[tonyp]

Unfortunately this article is for subscribers only.

Yes, exactly. Not everybody can afford to subscribe to all news outlets and, in light of that, I've always copied and pasted the content of any news item I post, which is allowed under copyright law as long as it's acknowledged and not used for commercial purposes. I follow Jo Haylen's social media and I found it quite amusing that, instead of publishing her own media release about her review of Sydney Trains, she simply posted a link to the SMH article that boronia referenced above, obviously assuming in her little inner west bubble (not the working class obviously) that everybody must read the Herald. She will get far in politics if she places all her announcements behind paywalls.

So, in short, I'm none the wiser about this review!

[Fleet Lists]

In fact I found it rather strange that I got the subscriber message as even this morning when I looked at another SMH article I could read it by posting it to a private window but it did not work for this one.

[Randomness]

https://12ft.io/proxy?q=https%3A%2F%2Fw ... 5cwjr.html

(Paywall remover for the article)

[boronia]

I think SMH allows 5 "free" views per week for general news articles. I've not had any negative responses to previous links I have posted here regularly.

Perhaps this article comes from one of their specialist sections which is limited to subscribers only.

Scandals put Downer EDI at risk of break-up

By Anne Hyland
April 1, 2023

When Aidan Cox, a project engineer, sat in the witness box at a NSW Independent Commission Against Corruption hearing this past week, he dobbed in one of the country’s most boring but civically important listed companies, Downer EDI, for having a corruption problem.

And not just a low-level corruption problem but one that in his opinion was “systemic”.

Cox, a subcontractor, is one of about a dozen individuals, including at least six former Downer staff, who have been accused by the ICAC of either rigging contracts, inflating bids, fraud, bribery and kickbacks. Those accusations relate to a range of rail maintenance contracts that were awarded by the NSW government to Downer (and by Downer to subcontractors).
Aidan Cox (top left) testifying at the ICAC hearings where bid rigging and fraud allegations have been made about rail maintenance contracts awarded to Downer EDI.

The ICAC investigation as it has unpicked these contracts has, within a few weeks, laid bare a culture of complacency and poor corporate governance at Downer, where the company failed to identify the shady behaviour going on under some of its top executives’ noses.

“One of the biggest factors in allowing fraud and corruption to occur in companies is either poor controls or lack of oversight of those controls,” says Chris Watson, a partner in Grant Thorton’s forensic consulting team.

In some examples, ICAC outlined where subcontractors had lined their pockets by inflating the price for work on a number of the government contracts awarded to Downer, while the company lost money on them.
Advertisement

That Downer lost money on some contracts, while subcontractors made money, should concern shareholders who might want to question Downer’s management about it at the next annual meeting, if there is one. The company’s poor earnings and weak share price performance has sparked speculation that it could be ripe for a break-up by private equity.

In the past three months, Downer has issued two profit downgrades, and its shares have lost almost half their value in a year, reducing its market cap to $2.3 billion.

The decline in Downer’s shares began well before the ICAC hearings commenced this month.

Last December, Downer revealed it had “accounting irregularities” in one of its power maintenance contracts and this may have led it to overstate its profits by as much as $40 million.

It prompted Fitch to place the company’s ratings outlook on a negative watch, which placed further pressure on Downer’s shares.

In Downer’s annual report, investors were warned of the risk to any adjustment to the company’s rating. “Where the credit rating is lowered or placed on negative watch, customers and suppliers may be less willing to contract with the group. Furthermore, banks and other lending institutions may demand more stringent terms [including increased pricing, reduced tenors and lower facility limits] on all financing facilities, to reflect the weaker credit risk profile.”

In a statement, the company said that it “remains in compliance with all financial covenants”. At the end of December, Downer’s net debt to EBITDA ratio was at 2.3 times, which sits within the company’s target range of 2-2.5 times, and anything below three times is generally considered ok. This ratio of leverage is a measure that shows how many years it would take for a company to pay back its debt. When asked about its interest cover ratio, which measures how easily a company can pay interest on its outstanding debt, Downer declined to comment other than to say it was meeting its financial covenants.

‘One of the biggest factors in allowing fraud and corruption to occur in companies is either poor controls or lack of oversight of those controls.’
Chris Watson, partner Grant Thornton

By February, Downer had a report from an external investigation into the accounting irregularities relating to the power contract, which revealed that the overstatement of profits between April 2020 and June 2022, was $22.2 million rather than the $40 million feared. In a statement to the ASX on February 27, the management and board said: “Downer is confident that the misreporting was specific to the contract and not replicated elsewhere.”

In other words, an isolated incident.

But it wasn’t. By early March, ICAC had revealed that there were problems in rail maintenance contracts from 2014 and 2020 involving the company. A Downer spokesman said the company only learnt of the ICAC investigation and operation on March 1, before it was made public the following day.
Peter Tompkins succeeded Grant Fenn as Downer’s chief executive in February and is now managing the fallout from the ICAC investigation.

With more scandals emerging, Downer shareholders began demanding significant change at the top of the company, which led to the retirement of the chairman, the resignation of the chief financial officer and the departure of another two board directors. Some mid-level staff who were the subject of the ICAC investigation also exited.

Downer’s chief executive, Grant Fenn, who held that role for 12-and-a-half years, had already flagged his retirement in December, and then stepped down in February. He was succeeded by the company’s chief operating officer, Peter Tompkins, who is now embarking on a turnaround and cost-cutting program.

Tompkins was Downer’s company secretary and general counsel when the company settled a class action in 2016 brought by shareholders concerning the group’s disastrous $3 billion Waratah train project for the NSW government.

The class action brought in the Supreme Court of Victoria heard that Downer knew a blow-out of costs and delays had put the project 12 months behind schedule and $117 million over budget more than a year before telling the market of its troubles with the contract.

Downer employs 33,000 people across Australia and New Zealand, and does mundane work that is important to most people’s daily lives. It has three divisions: transport, utilities and facilities, which in the event of a takeover would most likely be split up and sold off.

The transport division is contracted by local, state and federal governments to do work that includes maintaining more than 50,000 kilometres of roads for governments here and in New Zealand, by doing jobs such as resurfacing and fixing potholes. Downer also manufactures train cars, maintains them, and also looks after the tracks and facilities at platforms from ramps, lifts, fences, and even landscaping.

In February, despite its woes, Downer was named the preferred supplier by the Queensland government to deliver its $7 billion train program, which includes 65 trains and related infrastructure.

In its utilities business, Downer has contracts with power, telecommunication and water companies. For example, it has contracts to provide the maintenance and decommissioning of power and gas stations, and it does work for the NBN, looking after the latter’s network performance and sites.

In its facilities business, Downer has contracts for work that includes cleaning and mowing for large government departments, including defence, health and education.

On a sum of the parts basis, those divisions are worth more separated than together under the Downer umbrella. And this is why there has been talk of a potential break-up.

“There has been a lot of talk around that potentially there could be suitors circling,” says Fitch analyst Kelly Amato, but adds such discussion was before changes were made at board and management level.
Simon Mawhinney, chief investment officer at Allan Gray, would prefer Downer EDI wasn’t split up.

JPMorgan’s analysts calculate that Downer’s transport division is worth $2.27 billion based on a sum of the parts’ valuation. Whereas, UBS, a long-term adviser to Downer, has a much lower valuation of $1.39 billion. Either way, that transport business is worth half or almost all the market capitalisation of Downer at the moment. While JP Morgan values the facilities business at $2.2 billion, UBS says it’s worth $2.81 billion.

Simon Mawhinney, the chief investment officer at Allan Gray, which has a 7 per cent stake in Downer, would prefer that there is no split up of the group. “If the company, culturally, could set itself on a more sustainable path, I think shareholders are probably better off with management turning the company around the good old-fashioned way, rather than spinning it off and cutting it up into bits and pieces. But it’s hard to know what the future holds.”

The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.

[tonyp]

Still none the wiser about Haylen's review!

[boronia]

She's off to a good start by getting a consultant in to tell her what's wrong with the trains.