Slide 1: Freightways Full Year Results Presentation
FREIGHTWAYS FULL YEAR RESULTS PRESENTATION Freightways Limited and its subsidiaries. Full Year Report Financial Year ended 30 June 2020
Slide 2: We've never been afraid to be the first to do something
We’ve never been afraid to be the first to do something – if it’s the right thing to do This year we’ve successfully expanded into new areas because we But it also brought out the best in our culture. Right across our saw opportunities to add value across several sectors. We invested brands, people
Slide 3: Agenda
Agenda 1. 2020 HIGHLIGHTS & LOWLIGHTS 2. FINANCIAL POSITION & PERFORMANCE 3. DIVIDEND 4. STRATEGY 5. OUTLOOK Freightways Limited and its subsidiaries. Full Year Report Financial Year ended 30 June 2020
Slide 4: Highlights
Full Year Results Presentation 2020 HIGHLIGHTS Freightways Limited and its subsidiaries. Full Year Report Financial Year ended 30 June 2020
Slide 5: COVID-19 Impact
ACTIONS COVID-19 Impact + Range of onsite precautionary measures + Implementing PODS Led the industry with + Provision of PPE Extension and recognition contactless deliveries + Contact tracing records of lending facilities All Freightways’ businesses in NZ and AU were categorised as essential servic
Slide 6: COVID-19 Impact
COVID-19 Impact Express Package Information Management Revenue Comparison - year-on-year Revenue Comparison - year-on-year 15% 5% 10% 2.8% 0% 5% 10.1% 2.4% 4.8% -0.7% 0% -5% -5% -10% -10% -19.6% -18.7% -15% -33.0% -20% -15% -25% -30% -20% -35% -40% -25% Jul-Mar Apr May Jun Jul-Mar Apr May Jun Note:
Slide 7: COVID-19 Impact
COVID-19 Impact B2B, B2C MIX (in 2020) Network Courier Items by Delivery Point March April May June July Residential Business Rural Note: For like for like comparison, the Express Package graph above excludes contribution from Big Chill. Freightways Limited and its subsidiaries. Full Year Report Fin
Slide 8: Highlights
Highlights • Ability to respond to the challenge and demonstrate the resilience of the business model • Express delivery standards during the (level 3) peak online shopping period were a credit to our team when the pressure was on • Gained market share as a result of superior delivery performance •
Slide 9: Lowlights
Lowlights • Decline in Print and Copy of 50% through Covid-19 • Records Management facility utilisation stalled in 2HY in AU as Covid-19 took precedence for our customers • Slower and lower uptake of the digitisation project which is now expected to continue through FY21 • In AU many CBD office work
Slide 10: Financial Position & Performance
Full Year Results Presentation 2020 FINANCIAL POSITION & PERFORMANCE The financial results in this presentation should be read in conjunction with the abridged financial statements for the year ended 30 June 2020 which can be found in the NZX preliminary results announcement. Freightways Limited and
Slide 11: Financial Summary
Financial Summary For the year ended 30 June 2020 FY19 FY20 Change IFRS16 IFRS16 lease Excl. lease Excl. Excl. GAAP adj. leasing GAAP adj. leasing GAAP leasing Note $M $M $M $M $M $M % % Revenue 615.7 - 615.7 630.9 - 630.9 2.5 2.5 EBITA, before non-recurring items i. 96.8 - 96.8 97.8 5.3 92.5 1.0 (4
Slide 12: Non-recurring Items
Non-recurring Items 2020 2019 2020 Non-recurring benefits before tax totalling $2.6 million (no tax Non-recurring (gains) losses: applicable) in respect of reversing $1.6 million of a previously $000 accrued final acquisition payable that is no longer expected to be Impairment of goodwill 5,194 requ
Slide 13: Revenue Segmentation
Revenue Segmentation For the year ended 30 June 2020 FY19 FY20 Change $M $M % Express package & refrigerated transport 397.2 421.7 6.2 Postal 54.0 49.1 (9.1) Storage & handling 62.6 60.3 (3.6) Destruction activities 59.7 61.6 3.2 Other 42.2 38.3 (9.2) Total revenue 615.7 630.9 2.5 NOTES * Other incl
Slide 14: Express Package & Business Mail; Information Management
Express Package & Business Mail For the year ended 30 June 2020 FY19 FY20 Change $M $M % Operating Revenue 453.0 474.4 4.7 EBITDA 80.0 85.6 7.0 EBITA 72.2 75.9 5.2 EBITA Margin 15.9% 16.0% Information Management For the year ended 30 June 2020 FY19 FY20 Change $M $M % Operating Revenue 164.5 158.7 (
Slide 15: Balance Sheet – Key Points
Balance Sheet – Key Points • Total assets increased from FY19 by $466m, including $278m of right-of-use assets (NZ IFRS16), $134m of intangible assets and $28m of property, plant & equipment (both predominantly due to acquisitions in FY20). Higher trade & other receivables from increased activity an
Slide 16: Cashflow – Key Points
Cashflow – Key Points • Cash generated from operations of $160m was $52m above the PCP. With the adoption of NZ IFRS16, $34m of lease payments previously included in payments to suppliers are now classified in interest payment ($9m) and lease payments ($25m). COVID-19 wage subsidy of $16m has been n
Slide 17: Capital Expenditure
Capital Expenditure For the year ended 30 June 2020 2020 2021 Full Year Actual Full Year Forecast $M $M Capital Expenditure 23 20 - 22 Depreciation and software amortisation 47 52* (including impact of NZ IFRS 16) Depreciation and software amortisation 18 23* (excluding impact of NZ IFRS 16) * Incre
Slide 18: Dividend
Full Year Results Presentation 2020 DIVIDEND Freightways Limited and its subsidiaries. Full Year Report Financial Year ended 30 June 2020
Slide 19: Dividend
Dividend • The prudent course of action is to not declare a final dividend for FY20 given the uncertainty in both the NZ and Australian markets. • While recent trading has been strong in NZ, there has been a recent return to level 3 lockdown in Auckland and level 2 nationally along with a continued
Slide 20: Strategy
Full Year Results Presentation 2020 STRATEGY Freightways Limited and its subsidiaries. Full Year Report Financial Year ended 30 June 2020
Slide 21: Strategy: Core Areas of Business
Strategy 4 CORE AREAS OF BUSINESS Freightways Limited and its subsidiaries. Full Year Report Financial Year ended 30 June 2020
Slide 22: Express Package
Express Package Current State Strategy • Volumes have recovered after level 4 lockdown • Pricing For Effort: Stage II has been launched effective and, in the period from May-July, were above the 1st August at an additional 50c per item pcp • We have elected to levy a modest 1.9% price increase • Bus
Slide 23: Business Mail
Business Mail Current State Strategy • Mail volumes fell by 30% during level 4 lockdown but • Continue to expand our network to meet customer have recovered steadily to end the year above the demand and achieve greater efficiencies through pcp scale • Pricing for bulk mail is lower than the pcp due
Slide 24: Information Management
Information Management Current State Strategy • Covid-19 impacted a number of services in both AU • Target alternate storage revenue streams in NSW and and NZ: WA while Archives continue to be slow to transition in ‒ Archive growth stalled in 2H as decisions were • Continue to work Digitisation whic
Slide 25: Secure Destruction
Secure Destruction Current State Strategy • SD reduced by 90% during NZ's level 4 lockdown • Continue to target market share gains and by 15% in AU • Target new waste streams to divert from landfill • NZ activity bounced back after lockdown to pre- • Use a combination of acquisition, alliance and st
Slide 26: Outlook
Full Year Results Presentation 2020 OUTLOOK Freightways Limited and its subsidiaries. Full Year Report Financial Year ended 30 June 2020
Slide 27: Outlook
Outlook • Whilst the economic environment remains highly uncertain, we are encouraged by the strong trading results achieved in the last few months Growth in Items 2019 v 2020 • We would expect that 14% 14% – In Express Package, volume will eventually track macro-economic activity; 12% 11% 11% 10% –
Slide 28: Conclusion
Full Year Results Presentation 2020 CONCLUSION Freightways Limited and its subsidiaries. Full Year Report Financial Year ended 30 June 2020
Slide 29: Conclusion
Conclusion While Freightways is not alone in being cautious around the outlook for FY21 in a macro-economic sense, our stakeholders can be assured that our response to movements in volume will be swift but will not compromise on service to customers and the safety of our people. The Freightways dire
Slide 30: Appendix: Reconciliation to GAAP
Appendix: Reconciliation to GAAP For the year ended 30 June 2020 Express Package & Business Mail FY19 FY20 Change $M $M % Operating Revenue 453.0 474.4 4.7 EBITDA (before non-recurring items and NZ IFRS16) 80.0 85.6 7.0 Non-recurring items - (3.3) 100.0 NZ IFRS16 adjustment - 16.1 100.0 EBITDA (afte
Slide 31: Disclaimer
Disclaimer. This presentation has been prepared by Freightways Limited ("Freightways") for information purposes only. This presentation is not a product disclosure statement, prospectus or investment statement. Nothing in this presentation constitutes an invitation to subscribe for shares, securitie