Mainfreight Limited · NZX:MFT

Mainfreight — FY2019 Earnings Presentation

25 slides from Mainfreight's earnings presentation, May 2019

  1. Slide 1: Mainfreight Limited Full Year Result to 31 March 2019

    MAINFREIGHT LIMITED FULL YEAR RESULT TO 31 MARCH 2019

  2. Slide 2: Result Summary

    Result Summary Revenue up 12.9% to $2.95 billion (excluding FX up 10.8%) REVENUE An increase of $337.39 million Offshore revenues now exceed $2.24 billion EBITDA at $257.05 million, up 19.5% or $41.94 million EBITDA Excluding FX up 18.0% Net surplus after tax before abnormal items up 26.0% NET SURPL

  3. Slide 3: Dividend / Net Debt / Discretionary Bonus

    Dividend / Net Debt / Discretionary Bonus Final dividend of 34.0 cents per share DIVIDEND Books close 12 July 2019; payment on 19 July 2019 Total dividend for year 56.0 cents per share, increase of 11.0 cents or 24.4% over the previous year Gearing ratio improved from 21.7% to 13.5% NET DEBT Net deb

  4. Slide 4: Capital Management

    Capital Management NZ$ MILLION THIS YEAR LAST YEAR Operating cash flow 197.4 140.2  Capital expenditure totalled $89.2 million, with Land & Buildings $30.8 million, Plant & Equipment $42.8 million, and Information Technology $15.6 million Major items of Land & Buildings include:  West Auckland, NZ

  5. Slide 5: Capital Management … Capital Expenditure Expectations FY20

    Capital Management … Capital Expenditure Expectations FY20 NZ$ million Property New Zealand 54 Australia 108 Europe 3 Total Property 165 Other 48 Total Capital 213 Page 5

  6. Slide 6: Full Year Analysis: Revenue

    Full Year Analysis: Revenue $000 THIS YEAR LAST YEAR VARIANCE New Zealand: NZ$ 718,791 666,039 7.9%  Australia: AU$ 710,172 623,268 13.9%  USA: US$ 493,861 435,264 13.5%  Asia*: US$ 74,448 83,863 (11.2)%  Europe: EU€ 376,279 336,110 12.0%  Total Group: NZ$ 2,954,087 2,616,700 12.9%  (excl FX)

  7. Slide 7: Full Year Analysis: EBITDA

    Full Year Analysis: EBITDA $000 THIS YEAR LAST YEAR VARIANCE New Zealand: NZ$ 110,556 98,531 12.2%  Australia: AU$ 55,372 49,887 11.0%  USA: US$ 26,111 19,031 37.2%  Asia: US$ 6,308 4,921 28.2%  Europe: EU€ 23,264 17,775 30.9%  Total Group: NZ$* 257,049 215,114 19.5%  (excl FX) 18.0%  * Of th

  8. Slide 8: Second Half Comparison: Revenue

    Second Half Comparison: Revenue 2nd HALF 2nd HALF $000 THIS YEAR LAST YEAR VARIANCE New Zealand: NZ$ 375,671 349,172 7.6%  Australia: AU$ 368,469 330,355 11.5%  USA: US$ 256,707 232,206 10.6%  Asia: US$ 34,115 46,252 (26.2)%  Europe: EU€ 193,951 173,599 11.7%  Total Group: NZ$ 1,523,093 1,391,1

  9. Slide 9: Second Half Comparison: EBITDA

    Second Half Comparison: EBITDA 2nd HALF 2nd HALF $000 THIS YEAR LAST YEAR VARIANCE New Zealand: NZ$ 65,130 60,085 8.4%  Australia: AU$ 32,854 29,058 13.1%  USA: US$ 15,121 10,589 42.8%  Asia: US$ 3,136 2,895 8.3%  Europe: EU€ 12,859 9,372 37.2%  Total Group: NZ$ 148,707 126,348 17.7%  (excl FX

  10. Slide 10: Product Performance

    Product Performance NZ$000 THIS YEAR LAST YEAR VARIANCE VAR ex FX Group Revenue 2,954,087 2,616,700 12.9%  10.8%  EBITDA 257,049 215,114 19.5%  18.0%  Transport Revenue 1,450,942 1,297,013 11.9%  10.2%  EBITDA 156,681 128,382 22.0%  21.2%  Warehousing Revenue 346,567 289,080 19.9%  17.5% 

  11. Slide 11: New Zealand

    New Zealand Revenue: $719m 7.9% EBITDA: $111m 12.2%  Network contribution  Transport  Network intensification continues; reaching smaller regional areas  Mt Maunganui, South and West Auckland projects underway  Continuing to take market share  Logistics  Opened in Cromwell  Construction unde

  12. Slide 12: New Zealand

    New Zealand  Air & Ocean  Continuing to take inbound market share  Perishables capability improved with investment in Auckland  Regional branches contributing  New Zealand Outlook  Sales pipeline reasonably full  Increased overheads likely a drag in first half  Increased salaries again at lo

  13. Slide 13: Australia

    Australia Revenue: AU$710m 13.9% EBITDA: AU$55m 11.0%  Slower start; improved finish  Transport  Implementation of Mainstreet (software platform) – without issue, slower start  Network growth, remains a priority  Sydney’s second cross-dock advancing; rail capable  Logistics  New business oppo

  14. Slide 14: Australia

    Australia  Air & Ocean  Stronger push for more export growth vs import  LCL focus/capability required to grow this sector  Perishable market capability to feature medium-term  Australia Outlook  Transport network to continue its expansion  Sales pipeline requires more effort / supply chain in

  15. Slide 15: The Americas

    The Americas Revenue: US$494m 13.5% EBITDA: US$26m 37.2%  Improvement across all three Mainfreight divisions  Transport  Improving sales (particularly in first half) and more direct line-haul assisting profit  Still a large volume of freight with third parties – requires change  More direct lin

  16. Slide 16: The Americas

    The Americas  Logistics/Warehousing  Improving performance and utilisation from Los Angeles and Newark warehouses assisting profitability  Sales pipeline relatively strong for Dallas and Los Angeles  New warehouse for Atlanta and expansion to Seattle  Air & Ocean  Opened in Salt Lake City and

  17. Slide 17: The Americas

    The Americas  CaroTrans  Improved processes and freight utilisation – further improvement needed  Better alignment of overseas agencies  Stronger sales focus/management appointments  Margin improvement – more expected  Americas Outlook  Sales / Sales / Sales – still a weakness  Conscious of

  18. Slide 18: Europe

    Europe Revenue: €376m 12.0% EBITDA: €23m 30.9%  Transport performance key to overall improvement  Transport  Improving line-haul utilisation, cross-dock management and deliveries in Netherlands provided much-improved results  Partnership relationships for “other” European country deliveries enha

  19. Slide 19: Europe

    Europe  Air & Ocean  Opened in Hamburg, Germany – sea freight focus (air freight for Frankfurt)  Pleasing progress in the UK and Italy  Air & Ocean network within Europe now 12 branches  Work to do in Belgium and France  Europe Outlook  More sales effectiveness needed  Increasing sales perso

  20. Slide 20: Asia

    Asia Revenue: US$74m (11.2)% EBITDA: US$6m 28.2%  Exited poor performing air freight revenue  Air & Ocean  Focus on improving margins – exiting of wholesale air freight  Sales desks to assist in-country growth – 2nd tier cities  Expect USA/China trade-lane issues to impact trade volumes – unpre

  21. Slide 21: Strategic Initiatives

    Strategic Initiatives  Network intensity - ongoing  Within cities  Within countries  Globally Page 21

  22. Slide 22: Strategic Initiatives - continued

    Strategic Initiatives - continued  Top 500 Customers = 56% of total revenue  Top 500 Customers: Use of Mainfreight Divisions (Transport/Warehousing/Air & Ocean) 27% 28% 31% 32% 2019 2018 42% 40% 1 Division 2 Divisions 3 Divisions 1 Division 2 Divisions 3 Divisions  Increasing regional trading opp

  23. Slide 23: Group Outlook

    Group Outlook Expect ongoing improvement, although reduced trading days in SHORT-TERM April has had an impact IFRS 16 Lease Capitalisation – estimated impact for 2020 Year  Increased Assets and Liabilities $579 million  Increased EBITDA $105 million  Reduced PBT $8 million Supply chain sales init

  24. Slide 24: Financial Calendar F20

    Financial Calendar F20 DATE Annual Meeting of Shareholders 30 July 2019 F20 – 6 months ended 30 September 2019 13 November 2019 F20 – 12 months ended 31 March 2020 27 May 2020 Page 24

  25. Slide 25: Slide 25

Mainfreight — FY2019 Earnings Presentation on 6ix