Record Result By Freightways Exceeds Ipo Forecast

09 August 2004

Media Release

Record Result By Freightways Exceeds Ipo Forecast

AUCKLAND, 9 August 2004 - Positive growth across all the markets in which it operates has seen Freightways Limited (Freightways) deliver record revenues and earnings for the year ending 30 June 2004.

Freightways, which returned to New Zealand public ownership in September 2003 through a listing on the NZX, reported consolidated revenue for the financial year (30 June) of $214.5 million, up 10% on the previous 12 months. During the same period, earnings before interest, tax and amortisation (EBITA) were $40.7 million, 27% up on last year. Net profit after tax (NPAT) before minority interests was $16.1 million. Cash generated from operations before interest and tax was $48.2 million.

As signalled in its half year announcement Freightways has exceeded its IPO forecasts. This has occurred on all fronts:
2004 2004
Actual IPO forecast
$000 $000

Revenue 214,498 207,297
EBITDA 45,618 41,813
EBITA 40,714 36,118
NPAT 16,137 13,533
NPATA 21,081 18,352
Dividend 15,800 14,000

According to Freightways Managing Director, Dean Bracewell, this result has enabled the Directors to declare a final dividend of $8.55million, which exceeds the IPO final dividend forecast for the year of $7.25 million. The final dividend translates to 6.9 cents per share (fully imputed), to be paid on 30 September 2004, while the date for determination of entitlements to the dividend has been set at 17 September. This brings the total payout in respect of the year to $15.8 million or 12.75 cents per share (fully imputed), compared with the IPO forecast dividend of $14 million.

“This has clearly been an outstanding performance during a year of significant change,” says Mr Bracewell. “Our well known brands are strongly positioned in markets with continuing growth opportunities. Our well defined business model and market strategies will continue to be implemented in a consistent and disciplined manner.”

Mr Bracewell noted that the core express package businesses again contributed the majority of Freightways’ revenue and earnings and that the brands of New Zealand Couriers, Post Haste Couriers, Castle Parcels, SUB60 and Security Express all achieved strong growth over the previous year. Furthermore, in its business mail market, DX Mail again improved its contribution to Freightways, gaining increased sales traction with its suite of business mail services, while in the information management sector continued penetration was made in the document destruction, computer media storage and retrieval and records management markets. The acquisition of Archive Security during the year lifted Freightways into the No.3 position in this market.

“From our viewpoint the domestic economy remains favourable and we are unaware of any material changes to our operating environment that may negatively impact on Freightways’ performance,” says Mr Bracewell. “Subject to economic and business factors beyond our control, the outlook for Freightways, its shareholders and all other stakeholders remains positive.”

Note: Freightways has presented its operating performance for the prior 12 months on a pro-forma basis to reflect consolidated results had the parent entity existed at that time. These pro-forma adjustments enable a like-for-like comparison and take into account marginally lower compliance costs and higher depreciation as a result of Freightways’ change of ownership and subsequent public listing.

ENDS

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