Friday 29th January 2016
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Fliway Group says first half earnings beat prospectus forecasts as the freight and logistics company contained costs in the face of falling revenue.
Pro-forma net profit was between $3.3 million and $3.5 million in the six months ended Dec. 31, beating the forecast $2.9 million in Fliways' March prospectus, the Auckland-based company said in a statement. The better-than-expected earnings helped cash flow stay ahead of forecast, which will lead to net debt being 20-to-30 percent lower than the $8.9 million anticipated.
"Payback on significant capital expenditure invested ahead of the listing has been validated in the results via the lower operating cost base and strong capacity management," Fliway said. "We continue to experience softer revenues. This reflects lower fuel costs, lower international shipping rates and a challenging trading environment."
At its annual meeting in October, Fliway warned revenue would probably miss the prospectus forecast for a second time due to depressed import and export ocean freight rates as a result of overcapacity, and adverse fuel hedging.
The company transports and warehouses freight throughout New Zealand and co-ordinates freight movements internationally, including customs clearance. It has 400 staff, 170 vehicles in its fleet, and 15 sites nationwide. It also owns half of UPS-Fliway, a joint venture its had for the past 17 years with UPS, one of the world’s largest package delivery companies.
The shares last traded at 96 cents, down from the $1.20 listing price last April. The company is controlled by chief executive Duncan Hawkesby and his wife Gretchen, the daughter of New Zealand’s richest man Graeme Hart, who own about 54 percent.
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