MFT - Mainfreight. Global Freight & Logistics

[limegreen]

Not many shares have gone up post results of late.

DISC: Happy

[Snow Leopard]

The very last bullet point from Mainfreight's Analyst Presentation reads as follows:

"Acquisition opportunities being explored after a year of consolidation"

Isn't that nice?

[rmbbrave]

$10m interim for Mainfreight
23 November 2005
By PAM GRAHAM

Mainfreight has sharply increased its interim profit and dividend and is investing in a huge freight depot in Auckland in which rail will pass "right through the middle".


The proudly New Zealand logistics company reported net profit of $10.3 million in the six months to September 30, up from $1.15 million last year when abnormal items from taking over rival Owens Group were working through the accounts.

Excluding some Owens-related abnormals, the profit more than doubled, managing director Don Braid said.

The share price rose 9 cents to $3.49 on news of the result yesterday.

Earnings before interest and tax were $17.59 million, compared with $3.78 million last year. The interim dividend was increased by 2c to 5c a share and is payable on December 16 to shareholders on the register on December 9.

"The current level of performance is expected to continue through the remainder of the year," Mr Braid said.

The company was not ignoring indicators of a slowing economy, but "we have yet to see any impact to domestic freight tonnage".

"Freight tonnage at this point of time in the first six months is the same as last year. That is not a downturn, but it is not improving either."

Mainfreight is investing $6.2 million in a new Auckland depot in Otahuhu, on land the company bought 10 years ago. Freight and warehousing facilities totalling more than 278,710 square metres are planned.

"I don't think there's much bigger," Mr Braid said. "It will be a very effective, efficient freight facility that probably hasn't been seen in New Zealand before."

Mainfreight is looking to use rail freight more but said last month that Toll NZ-run services were as bad as under the previous Tranz Rail ownership.

Analysts said the margins on the Owens business were lower and the purchase increased interest costs but it was important strategically to take out a competitor in an industry that was rationalising.

Warren Doak of Macquarie Equities said Mainfreight was an excellent New Zealand business "and they know how to run it".

The international platform was also starting to move along nicely.

Thirty-eight per cent of the net surplus originated from divisions outside New Zealand. Last year, less than 5 per cent came from overseas.

"I think that is good for our business because we don't have a reliance on just one economy," Mr Braid said. It was also good for the New Zealand economy to have profits from overseas coming in.

The New Zealand International unit increased its interim profit by 60 per cent, Australian International increased earnings by 125 per cent and Australia domestic turned a loss into a small profit.

The earnings of the USA International unit increased by 118 per cent.

Earnings before tax and interest of the New Zealand domestic business rose 32 per cent to $9.74 million on revenue of $132 million, up 2.7 per cent.

Mainfreight took over rival Owens Group when they both had revenues of about $400 million a year, and sold many Owens businesses. The combined company had sales of $438.2 million in the six months, 1.7 per cent higher than last year.

The company would like to crack $1 billion in revenue this year but thought it might be next year.

Mainfreight made equity investments of $14.4 million during the half year, including buying Toll Holdings' share of Owens and further investments in Hirepool, acquired as part of the Owens takeover.

[Snow Leopard]

I found the December edition of the Mainfreight Newsletter waiting for me this evening which is as good an excuse as any to bring this thread back up to the front.
The first edition of this magazine, which is published twice a year, was to be perfectly honest, poor. However since then it has improved markedly and this edition maintains the standard.
The underlying note to the magazine is we are doing well but we can do better.
On the inside front cover Don [Braid] says "Our expectations are to achieve 15% sales growth every year".

This is a company that should keep growing.

[k1w1]

Move over there PT, I've just come aboard ...

[Bob Marley]

Yeah mon, always a good read those nice glossy Mainfreight newsletters. I see the company had a "Mainfreight Idol" competition recently mon but didn't invite loyal shareholder Bob.

I still like the company's fundamentals mon. Bob's expectations for FY06 is around $26m net profit which put MFT on pe of about 13.5 and gross divi yield of about 5%. I think they can still extract some more synergy benefits from Owens too mon and they seem to be turning around their overseas operations mon.

The only thing worrying Bob at the moment mon is the shares' struggle to break through $3.70. This is its third attempt mon.

[Snow Leopard]

$3.71, happy now Bob?

[limegreen]

It's not exactly an emphatic break out, but the time will come...

[Snow Leopard]

Some gone through at $3.80
Could we end today on a new high? I need an excuse to try the local beer []

[limegreen]

quote:Originally posted by Paper Tiger

Some gone through at $3.80
Could we end today on a new high? I need an excuse to try the local beer []

Yes. A few crossed after close last night at $3.73, and the buy/sell was looking optimistic this morning (3.75/3.80). Third quarter results due out in the next week or two? A good omen[][][?]