Transtasman punts by IRG: Freightways well backed

Investors were very supportive of Freightways moves to shore up its balance sheet in May.

The company completed a $45 million placement of shares at $2.44 per share, which was a 12 per cent discount to the closing price the day before the placement. Freightways shares went on to hit $3.15 later in May. They have come back since then, but have remained comfortably above the placement price.

The proceeds of the equity raising will be used to reduce debt and to further strengthen the financial position of the company. The share issue has reduced its forecast net debt to operating earnings for the year ending June from 3.1 times to 2.4 times.

Freightways is turning out to be quite resilient in the face of the recession, reporting a net profit for the nine months ended March of $24 million, up 4 per cent on the same period a year earlier.

JB HiFi on song

Australian home entertainment and consumer electronics company JB HiFi has performed exceptionally well in the past few years by rapidly growing its revenue and profits.

For the six months to December 31, 2008 the company reported a net profit of A$59 million, up from A$41.9 million in the previous corresponding period.

JB HiFi expects to exceed average analyst expectations for 2008-9. The company now forecasts its net profit for the year ending June 30 to be about A$92 million - a 41 per cent improvement over the previous year's net profit.

A disclosure statement can be obtained free of charge by calling IRG 0800 474669, or by email info@irg.co.nz.