Freightways posts record results in competitive market

Freightways managing director Dean Bracewell said in a statement that increased market share and the positive New Zealand economy in the 12 months to June had resulted in increased courier and parcel deliveries.

Operating revenue of $186.2 million was up 6 percent, and earnings before interest, tax and amortisation was up 15 percent to $27.7 million.

During the year Freightways paid fully imputed dividends of 6.8 cents per share to preference shareholders.

The courier and express freight, and business mail divisions generated revenue of $170.7 million, up 7 percent on the previous year.

The market was highly competitive, particularly at the economy end, but Freightways had managed to improve its margins by managing costs and developing economies of scale, Mr Bracewell said.

The company owns New Zealand Couriers, Post Haste Couriers, Castle Parcels, SUB60 and Security Express.

Freightway's earnings were down 20 percent in the information management and logistics markets, with the logistics business Stocklink continuing to operate in a "highly competitive and fragmented market", he said.

Freightways has been the subject of extensive due diligence since December as part of the ongoing sale process of its parent company, Ausdoc.

Directors have recommended an offer to Ausdoc shareholders, ownership of which provides control of Freightways, by ABN Amro Capital Australia in absence of a higher offer.

Ausdoc and Freightways chairman Michael Butler said the financial performance of Freightways had "exceeded the board's expectations".

"The sale process undertaken by Ausdoc has not detracted from the businesses' focus on their market strategies, which have contributed to the company's solid and improving performance."

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