Positive outlook for Freightways
Freightways gives positive trading update for the three months to September 30.
Freightways gives positive trading update for the three months to September 30.
The firm said revenue was up 9% on the same period last year, totalling $93 million. Earnings were up 8% to $16.6 million before interest, tax, depreciation and goodwill amortisation (EBITDA).
The company recorded a net profit after tax of $8 million for the quarter, up 19% on last year. It is the highest ever first quarter result recorded by Freightways since its IPO in 2003.
Strong revenue across several Freightways sectors boosted the numbers. The express package & business mail division delivered revenue growth of 7% for the period, with double digit EBITDA growth of 10%. The information management division had revenue growth of 14% (EBITDA growth of 5%).
The company said it had faced increased costs recently due to developments for additional capacity and $250,000 for Western Australia relocation activity. But the new capacity is expected to boost revenue once utilised, it said.
Outlook
Freightways expects continued gradual improvement across all its market segments.
The express package & business mail division remains reliant on growth amongst its existing customer base to sustain its year-on-year performance improvement, the firm said.
It added the information management division is transitioning successfully through a period of significant investment in capacity. While it is expected to deliver good year-on-year earnings growth through this transition, margins are predicted to be lower this coming financial year than in 2011.
Capital expenditure for 2012 is expected to be $18 million, including a one-off $4 million depot refurbishment at its main Auckland site to accommodate the relocation of NOW Couriers – currently based off-site. The cost savings as a result of this project are expected to be achieved in the the 2013 financial year.
Overall, Freightway’s cash flows are expected to remain strong throughout the financial year, the firm said.
Charlotte Woodfield
Thu, 27 Oct 2011
Thu, 27 Oct 2011
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Positive outlook for Freightways
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