KEY POINTS:
Transport and freight company Freightways says it has weathered a tough domestic market and soaring fuel bills to achieve yet another year of profit growth.
After tax profits were $32.3 million for the full year to the end of June, with earnings and revenues all up.
Managing director Dean Bracewell said the successful execution of its Australian growth strategy, along with a sound result from its core express package division had combined to help it continue its run of record annual results since listing on the NZX in September 2003.
A 14 per cent hike in revenue took total revenues over $300 million for the first time, while earnings before interest, tax, depreciation and goodwill amortisation (EBITDA) of $68.5 million were up 9 per cent above last year.
The $32.3 million after tax profit was 5 per cent higher than the previous year.
Freightways will be paying out a final 9.25 cents per share as dividend, taking its yearly payout to 18.75 cents, a four per cent increase on last year.
Bracewell described the New Zealand operating environment as "very challenging", with rising fuel costs and "negative organic volume growth."
Despite this, Freightways had delivered another record result and better positioned itself for future growth.
The majority of Freightways revenue and earnings comes from its express package division where Bracewell said high fuel costs had had a "significant impact." This division includes New Zealand Couriers, Post Haste Couriers, Castle Parcels, SUB60, Security Express, Kiwi Express and the recently acquired NOW Couriers.
Bracewell said this division achieved earnings for the year slightly above what it achieved in the previous 12 months, "which is a credit to the strength and flexibility of the Freightways model and to the team who delivered this result."
In July 2007 Freightways bought two document destruction businesses in Queensland, both of which had delivered on expectations.
"In recent years Freightways has successfully embarked on diversifying its activities both geographically and deeper into the informational management market," said Bracewell. "We will continue to seek out and develop growth opportunities that complement our existing capabilities to support this strategy."
Bracewell said he expected Freightways' core express package division to continue to perform soundly overall, though monthly volumes would keep fluctuating, making it " difficult to accurately forecast near term performance."
"While some cost increases are expected to moderate in the 2009 financial year, the cost of fuel is naturally very difficult to predict."
Bracewell said he expected Freightways' performance to "continue the trend shown in this and recent results announcements, albeit the performance of the New Zealand economy will influence this outcome. In the medium to long-term, Freightways is exceptionally well positioned to reap the benefits of any improvement in the New Zealand marketplace."
- HERALD ONLINE
