Mainfreight profit before abnormals record $47.2m

Friday 27th May 2011

Mainfreight lifted full year net profit before abnormals to a record $47.2 million, with improved performances from all divisions across all countries.

"Recovery in world freight volumes across most trade-lanes assisted this improvement, together with Mainfreight's ability to grow market share through focused sales campaigns and enhanced products and services," the company said.

The past year had been a "defining period" for the company, which was in a position to take advantage of the scale offered by its growing global presence, Mainfreight said.

Operating revenue rose for the year to the end of March to $1.34 billion from $1.13 billion the year before, with net profit before non-recurring expenses up to $47.2 million from $38.3 million. Reported net profit fell to $25.7 million from $36.4 million, due to abnormal costs including a non-recurring non-cash deferred tax liability for tax depreciation and one-off costs associated with the acquisition of the Wim Bosman Group.

A final dividend of 11c per share is to be paid, taking the full dividend for the year to 20cps, compared to 18.5cps the year before.

Earlier this year the company bought the Netherlands-based Wim Bosman Group, with 14 branches across six European countries. The initial purchase price was 110m euros -- about NZ$205 million at the time.

Mainfreight said that with the better performance across all its divisions it had been able to reintroduce its full team discretionary bonus, along with regular wage and salary reviews.

Momentum had carried through into the current financial year, and the improved financial performance was expected to continue through this year and 2012.

As the financial performance strengthened, capital spending would rise to continue the company's branch facility improvement programme and to meet other commitments needed to develop the business, Mainfreight said.

The acquisition of Wim Bosman provided the company with an important European footprint, and the company's first presence in South America had been established in Santiago, Chile.

Revenue from New Zealand operations rose 10% to $412.6 million, while ebitda lifted 8.6% to $47.9 million.

This country now accounted for just 52.3% of group ebitda, and in the coming year profits from the company's Melbourne domestic operations were expected to surpass those of Mainfreight's largest New Zealand branch in Auckland.

As a result of earthquake issues, warehousing had migrated back to Auckland from Christchurch. That move was likely to become permanent as customers reconfigured their supply chains, Mainfreight said.

Revenue from Australian group operations rose 20.4% to $472.3 million, with ebitda up 14.1% to $25.6 million.

By market size, the Australian operations remained small, and much had to be done to increase the company's network intensity.

Regional branch development continued with the opening of a facility on the Gold Coast, while five more branches were planned to open in the next 24 months.

Asian revenue lifted 29.8% to $36.2 million with ebitda up 68.7% to $3.5 million.

In the US revenue rose 24.8% to $420.5 million and ebitda rose 101.3% to $14.6 million.

NZPA

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