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The Australian Financial Review reports:

Toll Holdings has warned that parent Japan Post has only guaranteed its debts until mid-2021 after revealing its annual net loss plunged six-fold to $685.3 million.

The hefty loss for the 12 months to March 31, 2020, disclosed in filings with the Australian Securities and Investments Commission that were released on Tuesday, comes as Japan Post – which spent $6.5 billion buying the Australian logistics group in 2015 – appoints banks to review selling off all or part of Toll.

While Toll’s competitors, including Qube, have signalled they would be interested in buying parts of the company if it is split up, Qube chief executive Maurice James has said he has “no interest” in the company’s troubled express division, which competes with Australia Post.

“Some of the problems that Toll have got today come from that express freight capability,” he told The Australian Financial Review last month.

Australia Post’s express parcel volumes have been rising as it invests more money in broadening its express services to more homes, making faster deliveries and communicating directly with customers.

Global economic conditions, the summer bushfires, cyber attacks and COVID-19 have reduced the amount of freight Toll moves, the company said.

Group revenues slid 6 per cent to $7.8 billion, while net cash outflows from operations deepened by $5 million to $42 million.

Time is running out for Toll to make more money and pay back its debt, with Japan Post only guaranteeing Toll’s banking facilities until “a maximum date” of June 30, 2021, the ASIC filing said.

Toll’s total interest-bearing liabilities have soared, almost doubling over the past 12 months to $6.6 billion and liabilities exceeded its assets by $3 billion at the end of March.

Toll secured an additional $200 million banking facility in May.

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