Ann: QUARTER: FRE: Trading Update

• Release Date: 31/10/13 12:27
• Summary: QUARTER: FRE: Trading Update
• Price Sensitive: No
• Download Document  4.75KB

					FRE
31/10/2013 10:27
QUARTER

REL: 1027 HRS Freightways Limited

QUARTER: FRE: Trading Update

An update on the unaudited trading performance of Freightways Limited
(Freightways) for the three months ended 30 September 2013 is provided below.

Freightways' revenue totalled $105 million, a 4% increase on the prior
comparative period (pcp). Earnings (operating profit) before interest, tax,
depreciation and amortisation (EBITDA) of $19.2 million was 3% above the pcp
and earnings (operating profit) before interest, tax and amortisation (EBITA)
of $16.3 million was 4% above the pcp. Net profit after tax (NPAT) of $9.8
million was 7% above the pcp.

Freightways' results for the three months ended 30 September 2013
(unaudited):

2013 $000; 2012 $000; % variance
Revenue 104,691; 100,908; 4%
EBITDA 19,231; 18,653; 3%
EBITA 16,327; 15,680; 4%
NPAT 9,790; 9,185; 7%

Our overall first quarter performance is positive and, while still early in
the financial year, it underpins our expectation of a full year result ahead
of the prior year.  This expectation of increased earnings will be further
assisted by the anticipated contribution from newly-acquired information
management businesses in New Zealand and Australia.

Express Package & Business Mail division

Our express package & business mail division's revenue of $80 million was 5%
above the pcp. EBITDA of $13.5 million and EBITA of $12.1 million were both
2% ahead of the pcp, respectively.

Sound activity from existing customers has been further assisted by quality
market share gains across all our retail businesses. New Zealand Couriers,
the Post Haste Group, that also includes Castle Parcels, NOW Couriers and
Pass The Parcel, and the Messenger Services Group, that includes the
point-to-point business of SUB60, Kiwi Express, Stuck and Security Express,
all performed well compared to the prior year. Our smaller DX Mail business'
year-on-year performance has, as expected, declined during this period as it
continues to adapt to a changing business mix, with growth in its mailhouse
business of Dataprint and in its street delivery volumes not yet offsetting
the decline in box-to-box letter volume and lower international package
volumes. DX is nonetheless making very good progress in transitioning through
this structural change to its industry and it continues to contribute
profitably to this division's performance.

Information Management division

Our information management division has again performed strongly, with
revenue of $25 million on par with the pcp. EBITDA of $5.9 million and EBITA
of $4.8 million were 1% and 4% ahead of the pcp, respectively.

Our businesses on both sides of the Tasman continue to perform very well with
strong revenue growth of 9% in New Zealand and 6% in Australia (on a constant
currency basis) ahead of the pcp. The translation of our Australian
performance at the currently stronger New Zealand dollar exchange rate
compared to the lower New Zealand dollar exchange rate in the pcp has
resulted in a divisional revenue result that is on par with the pcp. Growth
from existing customers and market share gains in all locations contributed
to offsetting our higher costs relating to the increased capacity we have
recently invested in and again lower recycled paper prices.

Corporate

Corporate costs continue to be well contained and are tracking lower than the
pcp.

Recent acquisition activity

Effective from 1 October 2013, Freightways has acquired the business and
assets of Brisbane-based Document & Data Storage Management and the
Dunedin-based Document Destruction Services. The total cost of these
acquisitions is approximately $4.5 million. Upon completion of the
integration of these businesses the full 12-month EBITDA contribution
expected from them is $0.8 million. These acquisitions complement our
existing capabilities and add long-standing customer relationships,
experienced people and scale to our existing operations.

Outlook

Our express package & business mail division is expected to perform soundly
overall and continue the positive trend seen in our first quarter result.

Our information management division is expected to continue its strong growth
and deliver further improved margins as its new capacity is progressively
utilised and its newly-acquired businesses are fully integrated within our
existing businesses.

Freightways will continue to seek and develop growth opportunities, including
acquisitions and alliances that complement its core capabilities.

Subject to business factors beyond its control, Freightways is well
positioned to benefit from any further improvement in the markets in which it
operates.

For further information contact:

DEAN BRACEWELL
Managing Director
Freightways Limited
Ph: (09) 571 9672
Fax: (09) 571 9671
End CA:00243130 For:FRE    Type:QUARTER    Time:2013-10-31 10:27:25