Domestic bliss for freight company

By CHRIS DANIELS

A buoyant domestic economy has lifted profits of local transport firm Freightways Express by 33 per cent to $13.1 million.

Freightways, which owns NZ Couriers, Post Haste Couriers, Sub60 and DX Mail, is fully owned by Australian transport company Ausdoc, which yesterday announced a loss of A$41.2 million ($48 million).

Freightways Express managing director Dean Bracewell said increased market share and "the positive New Zealand economy" translated into more courier packages and parcels being delivered and so earnings were up 15 per cent from the year before.

The courier/express freight and business mail divisions accounted for $170.7 million of the company's total operating revenue of $186.2 million.

Dividends of 6.8c a share were paid to the 2800 New Zealand holders of Freightways preference shares in the past year.

Ausdoc's big loss was largely due to big writedowns, book losses and the cost of the sales process. Before significant items of A$47.3 million ($55 million), it made a profit of $6.2 million ($7.2 million), up 39 per cent from the year before.

Ausdoc is in the process of being taken over by ABN Amro Capital.

No takeover offer is being made for the Freightways preference shares.

As the likely new owner of Freightways, ABN Amro Capital last month said it was "very comfortable" with the business and in no rush to change the way it operates.

ABN Amro Capital set up its Australian operation two years ago, and has investments in three companies worth A$35 million ($40.68 million). The Ausdoc deal is its biggest and the first time it has bought a public company and taken it private.

Dean Bracewell said last month that the company had operated autonomously under Ausdoc ownership for 4 1/2 years. He expected it to be business as usual under the new owner.

Ausdoc's directors, who own 14 per cent of the firm, are recommending that the company's other shareholders accept the offer, which closes on August 23.