Mainfreight profit falls 67%

Thursday 20th August 2009

Mainfreight, the biggest trucking company on the NZX 50, posted a 67% slide in first-quarter profit on one-time restructuring costs and weaker trading in New Zealand and the US.

Net profit fell to $2.75 million in the three months ended June 30, from $8.2 million a year earlier, the company said in a statement. The results included one-time costs of $1.27 million that the company said are unlikely to be repeated through the remainder of the year. Sales fell 9.4% to $262 million.

“Trading conditions in all countries during the first three months of the financial year were difficult and followed trading similar to that experienced during January to March,” managing director Don Braid said.

“Trading in July and August sees some improvement and it is our expectations that this will continue into the third and fourth quarters.”

Shares of the transport company rose 0.2% to $4.80 in light, early trading and have climbed about 20% in the past month. Mainfreight has reduced debt and extended its bank facilities to strengthen its finances during the downturn. In the latest quarter, net debt fell 13% to $100 million.

In the domestic New Zealand market, its biggest by earnings, EBITDA fell 28% to $5.89, mainly reflecting deterioration in freight volumes. Sales fell 18% to $62 million. New Zealand international sales slid 3% to $23 million while earnings climbed 22% to $790,000 on cost cutting and an increased share of the airfreight market, it said.

Australian domestic operations fattened their EBITDA by 29% to $1.96 million, even as sales fell 5.9% to $42 million, on increased market share for its distribution business and improvements in Logistics. Australia International lifted revenue by 21% to $43.9 million, helped by the acquisition of Halford, while import volumes fell. Earnings soared 78% to $1.55 million.

In the US, revenue fell 18% to $84.9 million. Excluding the impact of foreign exchange movements, sales fell 36%. Combined EBITDA from its CaroTrans unit and Mainfreight USA was $1 million.

Asia international revenue rose 6.7% to $5.3 million while earnings sank 13% to $520,000.

Businesswire.co.nz

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