MIG cuts toll road valuations 28%, shares rise(3)

The Macquarie Infrastructure Group said a preliminary June 2009 portfolio valuation was about A$2bn less than its December 2008 valuation of A$7.1bn. It blamed the decrease on difficult economic and market conditions contributed.

Macquarie Infrastructure Group (MIG) has slashed its toll road portfolio valuation by 28 percent, blaming the decrease on the ongoing dislocation in global economic and market conditions.

The Australian Stock Exchange-listed toll road developer said in a statement that its portfolio of nine toll roads was worth approximately A$5.1 billion (€2.9 billion; $4.1 billion) as of 30 June 2009, or A$2.54 per share. That’s about A$2 billion less than the final 31 December 2008 valuation of A$7.1 billion, or A$3.30 per share, disclosed in its interim results presentation in March.

MIG's toll roads: still
falling in value

The final December 2008 valuation was about A$600 million higher than an interim valuation MIG had provided late last year but it was still down significantly from its 30 June 2008 portfolio valuation of A$8.6 billion.

MIG said the new valuation reflected “the ongoing dislocation in global economic and market conditions”, which resulted in lower forecast traffic volumes. Changes to discount rates for its assets and the impact of movements in foreign exchange rates also affected the valuation, MIG said.

Markets cheered the news as analysts had expected an even wider cut in its valuation. MIG’s shares ended the day up 1.8 percent, closing on A$1.42.

The valuation is preliminary, MIG cautioned, and is subject to finalisation before the firm releases its full year results on 20 August.