Aurizon Holdings Ltd (ASX: AZJ) shares are pushing higher in early trade on Wednesday.
At the time of writing, the ASX 200 share is up 2.5% to $4.28.
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What is lifting this ASX 200 stock?
This morning, the rail freight operator released a business update ahead of its presentation at the Macquarie Australia Conference.
Investors appear to be responding positively to Aurizon reaffirming its FY 2026 guidance despite some fuel cost timing pressures.
According to the release, Aurizon continues to expect group underlying EBITDA of $1.68 billion to $1.75 billion for FY 2026.
The company also reaffirmed its full year dividend guidance of 22 cents to 23 cents per share.
This appears to have reassured the market, particularly given ongoing volatility in fuel markets and recent weather-related disruptions.
Volume growth across key divisions
Aurizon also provided investors with a ten-month volume update to 30 April 2026.
Network volumes in the Central Queensland Coal Network reached 173.5 million tonnes, which is up 2.6% on the prior corresponding period.
Coal volumes increased 0.8% to 158.4 million tonnes. This is despite the impact of adverse weather on customer mine production in Central Queensland during the March quarter.
The strongest volume growth came from Bulk and containerised freight.
Bulk volumes rose 6.7% to 48.4 million tonnes, supported by higher grain volumes and the start of the BHP Group Ltd (ASX: BHP) Copper South Australia contract.
Containerised freight volumes increased 13.2% to 194,000 TEUs. This was driven by growth from new and existing customers.
Fuel cost impact manageable
Aurizon also addressed fuel supply and pricing pressures.
The ASX 200 share said its operations have continued without interruption, with its incident management team taking proactive steps in March to ensure ongoing diesel supply across its national network.
Aurizon noted that most of its fuel costs are recovered through customer contracts with monthly fuel adjustment mechanisms.
However, a small number of contracts, mainly in the Bulk business, use quarterly fuel adjustment mechanisms. Based on current pricing, this is expected to create a temporary negative EBITDA impact of approximately $10 million in FY 2026.
Importantly, Aurizon said this is a timing issue and the increased cost should be recovered in future quarterly adjustments if fuel prices reduce.
The ASX 200 share has kept its capital expenditure guidance unchanged. This includes non-growth capex expected to be between $580 million and $600 million and growth capex forecast at $100 million to $150 million.
