Mainfreight produces bumper year result but fourth qtr slows

Freight company Mainfreight today reported a March quarter net profit of $9.08 million compared with the $5.96m earned in the fourth quarter last year.

That bought the March year net profit to $29.04m -- up 115 per cent on the $15.52m for fiscal 2005. The fourth quarter was slightly down on the $10m earning in the third quarter.

Mainfreight doubled its final dividend to 7c. It will be paid on July 21 and takes the full-year, fully imputed return for the year to 12c per share, up from 6.5c last year.

Managing director Don Braid said trading in April had been affected by the timing of Easter but May results were up on a year ago and "expectations for the remainder of the year are positive".

Mainfreight shares closed on a record $5.30 yesterday. They have risen from $2.44 this time a year ago and $1.83 on May 30, 2004.

Earnings before interest and tax (ebit) doubled for the year to $48.5m. Sales increased 3.4 per cent to $887m and, excluding divested business units and foreign exchange, were up 7.4 per cent.

Mr Braid said performance met expectations signalled during the year, with all divisions contributing positively to the result.

Off-shore business units now contribute 43 per cent of ebit and their combined revenue was 52 per cent of group sales.

Australian operations improved ebit to $17m from $8m last year.

Mr Braid said offshore operations offered significant growth opportunities.

In the US, the CaroTrans unit improved its ebit 129 per cent to $4m while associates in Britain and China also improved without quite meeting expectations.

Trading conditions in all countries of operation had been positive throughout the year, Mr Braid said.

Domestic ebit improved 10 per cent to $24.78m with revenue up 1.5 per cent to $269.18m.

Mr Braid said current trading revenues in domestic logistics and freight were on par with the previous year. The Owens transport and logistics operations were now contributing positively.

New Zealand International ebit improved 11 per cent to $2.65m but growth was below desired levels and Mainfreight International and Owens International would be merged as a result.

The Australian domestic ebit of $4.2m was on sales of $100m, up 14 per cent.

Australian International ebit improved 71 per cent to $12.9m.

Mr Baird said the proposed sale of a 24.5 per cent stake in Hirepool, which is considering a separate listing, would have a positive effect on earnings and the balance sheet.

Operating cash flows jumped to $47.40m from $10.9m last year when the Owens acquisition affected flows.

- NZPA