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Running head: REPORT 0
CORPORATE FINANCE MBA 610
Aurizon Holding Limited
MARCH 17, 2020
STUDENT DETAILS

REPORT 1
Contents
I. Corporate governance analysis...................................................................................... 2
I. Stakeholder analysis................................................................................................... 2
II. Risk and return......................................................................................................... 2
III. Capital structure choices........................................................................................... 4
IV. Dividend Policy..................................................................................................... 5
V. A framework for analysing dividends.............................................................................. 5
VI. Financial Statements –............................................................................................. 6
References................................................................................................................... 11

REPORT 2
I. Corporate governance analysis
Aurizon Holdings Limited is a publicly listed rail freight company of Australia. This
company is owned by government of Queensland (Reuters, 2019). The directors and executives
have collective ownership. It is analysed that the non-Executive directors are required to keep
directors’ fees of the shares of one year in the entity. The MD and CEO keep the fixed
Remuneration of share of one year in company. In addition, it is assessed by company that
related party transaction can create conflicts of interest. Further, the shares of company are
traded on Australian stock exchanges. Moreover, it makes commitments to develop strong
relationship with public or society.
I. Stakeholder analysis
The breakdown of stockholders is discussed as below –
 Institutional Ownership (54.59%)
 Insider ownership (less than 1%)
 General public ownership (42.61%)
 Private company ownership (2.76%)
In this way, insiders are marginal investors in this stock.
II. Risk and return
Risk = 0.75
Market rate of return = 5.83 %
Cost of capital -
Calculation of market value weights-

REPORT 3
Debt Equity Total
Market value of equity shares
($B)
11,602.
28
Add: Retained Earnings
352.
30
Value of debt 3369.80
Total 3369.80
11,954.
58
15,
324.38
Weights 0.22
0.
78
B) Cost of Equity and cost of Debt -
Cost of Equity: CAPM model
Risk free rate 2.75%
Market rate of return 7%
Beta 0.75
Cost of equity 5.83%
Cost of debt:
Net finance cost ($M) 147.01
Less: Tax @30% 44.13
After tax cost of debt 102.97
Borrowings amount 3369.80
After tax cost of debt (%) 3.06%
C. WACC-
Debt
Ordinary
Shares Total
Cost of Finance 3.06% 5.83%
Market Weights 0.22
0.7
8
WACC 0.67% 4.54% 5.22%