The financial outlook for tolling continues to be grim as one of the largest operators of toll roads in the United States and Australia announced today that it had suffered losses in excess of $292 million over the past two years. Despite charging Australian and American motorists $767 million in tolls and fees -- an increase of 34 percent -- in the year ended June 30, 2008, Transurban reported a loss of $140 million.

The bad news followed the last week's revelation that credit analysts at Fitch Ratings changed their outlook on tolling as an investment to "negative," citing high gasoline prices and unfavorable exchange rates. Nonetheless, Transurban's top executive insisted the future was bright for his company.

"We have a very good suite of assets with strong cash generating potential," CEO Chris Lynch said in a statement to investors. "Our aim is to maximize the amount of cash that reaches shareholders."

Among the bright spots on its balance sheets, Transurban noted the "success fees" it collected for the financial close of the Capital Beltway HOT lanes, a project that Transurban facilitated with illegal campaign donations to the Virginia governor and state lawmakers. It also noted the accounting benefit of selling Virginia's Pocahontas Parkway toll road to "Transurban DRIVe," a fund whose losses are kept on a different set of books.

Transurban is also looking forward to using state and federal taxpayer dollars to add tolls to existing lanes on Interstate 95 in Virginia under terms as favorable as the Capital Beltway HOT lane project. After implementing a $20 million cost reduction by tightening the corporate budget, the company intends to use year-on-year toll increases to cover an accumulated debt of A$4.6 billion. Virginia motorists, for example, will make toll payments to Transurban for 97 more years on the Pocahontas Parkway and for 78 more years on Interstate 495.

Aside from expanding operations in Virginia, Transurban also hopes to begin imposing tolls on Georgia freeways.