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Freightways profit up 5%

Monday 18th August 2008

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Freightways, the biggest courier firm on the NZX, posted a 5% gain in annual profit and increased its final dividend after expanding in Australia and lifting sales from express packages.

Net profit rose to NZ$32.3 million from NZ$30.8 million a year earlier, the company said in a statement. Operating revenue rose 14% to NZ$323.9 million.

Freightways lifted earnings even as fuel costs rose and the domestic economy slowed. Express packages, its biggest source of revenue, should "continue to perform strongly," managing director Dean Bracewell said today.

The company raised its final dividend to 9.25 cents a share from 9 cents, bringing its full-year payments to 18.75 cents, a 4% gain from the previous year.

Freightways expanded in Australia last year, buying data storage firm National Records Managers and Fine Paper Suppliers, a document destruction and paper recycler that is being merged with its existing Shred-X unit. Information management is "an emerging growth opportunity," Bracewell said.

Bracewell confirmed the combined purchase price for the two acquisitions at A$5.9 million. "It is expected that these businesses will generate EBITDA in total of approximately A$1 million in the 2009 financial year," he said.

Freightways stock has gained 8% in the past month, about matching the NZX 50 Index.

By Jonathan Underhill

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