Freightways Express delivers the goods

By DANIEL RIORDAN transport reporter

A solid all-round performance has boosted profit by 37 per cent at Freightways Express.

The Australian-owned courier and freight delivery operator posted a net profit of $9.86 million for the year to June 30, compared with $7.22 million the previous year.

The result was based on an 8 per cent jump in revenue to $176 million, with efficient freight handling and tight cost-control yielding 15 per cent growth in earnings before interest, tax, depreciation and amortisation (ebitda).

Freightways' major business units, NZ Couriers and Post Haste, increased their market share and revenue. The Fieldair and Parceline air and road line-haul businesses also benefited from the strong volumes generated by courier and express freight.

The smaller businesses of Messenger Services (fast couriers), DX Mail (business mail), Online (records management) and Stocklink (logistics) all lifted their performances, but the company said some softness was evident in the June quarter.

Chairman Ken Barry said the result exceeded expectations.

In May, the company raised $30 million through an oversubscribed preference share issue. The money will be used to reduce bank debt associated with the acquisition of Fieldair Holdings and the construction of facilities in Auckland and Wellington.

Freightways' 39 million ordinary shares are owned by Ausdoc International. Freightways has around 1500 preference shareholders, mostly New Zealanders, with no voting rights.

During the year, Freightways paid fully imputed dividends of 7.48c a preference share, and a further dividend has been scheduled at that rate for October 31.

At that date, the dividend rate on all preference shares on issue will be reset for a further 12 months in accordance with the terms of the recent issue.

Mr Barry, who is also chairman of Ausdoc, said he would retire from both boards. Michael Butler will replace him.

Freightways' preference shares closed 1c down yesterday at $1.02.