Ann: Chairman and CEO AGM Address to Security Holders, page-2

Transurban 'protected' from spikes in interest rates, says Lindsay Maxsted
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Transurban chairman Lindsay Maxsted will stay until 2020-21.
by Jenny Wiggins

Transurban is in "good shape" to survive any spikes in Australian interest rates because most of its $15 billion in net debt is held at fixed rates and its toll fares rise in line with inflation, chairman Lindsay Maxsted told the toll road company's annual meeting in Melbourne.

Some 98 per cent of Transurban's debt has fixed interest rates, and the average maturity of its debt is 9.2 years, Mr Maxsted told investors worried about the knock-on impact of rising interest rates in the US.

Mr Maxsted, who is also chairman of Westpac, said he did not think interest rates would "really take off", but that Transurban was "protected" if they did.

"One of the natural buffers that we have here is that all of our roads, in terms of pricing, are linked to CPI," Mr Maxsted said, adding that use of Transurban's roads had not dropped significantly during the global financial crisis, when Australian interest rates were as high as 7 per cent.

"There will be a link between increasing interest rates and inflation so there's a natural hedge there as well." Australia has not yet followed the US's lead in raising interest rates.

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