Slide 1: Full Year Presentation
Full Year Presentation 6 August 2007
Slide 2: This presentation relates to the Freightways Limited NZX announcement and media release of 6
This presentation relates to the Freightways Limited NZX announcement and media release of 6 August 2007. As such it should be read in conjunction with, and is subject to, the explanations and views contained in those releases.
Slide 3: Presentation
Presentation ¾ 2007 highlights ¾ Operating performance ¾ Business strategy ¾ Outlook
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Slide 5: 2007 Highlights
Freightways 2007 Highlights
Slide 6: General Highlights
General Highlights • Core businesses have performed soundly in a challenging domestic marketplace • Emerging businesses have delivered strong growth • Acquisitions have established FRE’s presence in the Australian market • FRE has delivered another record result
Slide 7: Financial Highlights
Financial Highlights 2007 2006 variance $000 $000 % Operating revenue 283,447 256,689 10% EBITDA 62,929 58,318 8% EBITA 56,531 53,360 6% NPAT 25,091 24,306 3% NPATA 30,901 29,276 6% Earnings per share (NPAT) 20 cents 19 cents 5%
Slide 8: Operating Performance
Freightways Operating Performance
Slide 9: Operating Revenue
Operating Revenue 300 250 200 2nd Half $M 150 1st Half 100 50 - Jun99 Jun00 Jun01 Jun02 Jun03 Jun04 Jun05 Jun06 Jun07 Year Ended • 10% revenue growth compared to 2006 • 5-year compound average annual revenue growth of 9%
Slide 10: Where Revenue Growth Has Come From
Where Revenue Growth Has Come From 300 290 5% 283 280 2% 270 2% 260 257 1% 250 $M 240 230 220 210 200 2006 Or g a n i c P ric ing Ne w B usine ss Ac quisit io n 2007 Growth drivers
Slide 11: EBITA
EBITA 60 50 40 2nd Half $M 30 1st Half 20 10 - Jun99 Jun00 Jun01 Jun02 Jun03 Jun04 Jun05 Jun06 Jun07 Year Ended • 6% EBITA growth compared to 2006 • 5-year compound average annual EBITA growth of 15%
Slide 12: Drivers of EBITA Growth
Drivers of EBITA Growth • Acquisition activity • Business mix • Margin integrity • Cost control
Slide 13: Balance Sheet
Balance Sheet • Negative working capital position continues • Increase in fixed assets of $12m (net of depreciation) • Increase in bank borrowings of $25m • Goodwill amortised over 20 years ($6m annual charge) • Increase in brands of $11m
Slide 14: Cash Flows
Cash Flows • Cash generated from operations of $62m • Capital expenditure of $18m • Payments for acquisitions of $24m • Borrowings increased by $25m during the year
Slide 15: Dividends
Dividends Jun-07 Dec-06 Jun-06 Dec-05 Dividend declared $11.6m $11.6m $11.2m $10.9m Cents per share 9.00 9.00 8.75 8.50 Full year (cps) 18.00 17.25 Key points: • Increase of 3% compared to 2006 • Fully Imputed • Record date: Friday, 14 September 2007 • Payment date: Monday, 1 October 2007
Slide 16: Business Strategy
Freightways Business Strategy Hubs Shuttle Links Courier "Spoke" to/from area Geographic Area
Slide 17: Business strategy
Business strategy • Continued development of organic growth opportunities in Freightways’ existing three markets • Positioning, People, Performance, Profit • Explore complementary acquisition opportunities
Slide 18: Progress - Australia
Progress - Australia • July 2006 Acquire DataBank (NSW, VIC) • January 2007 Start-up DataBank Queensland • July 2007 Acquire Shred-X (QLD) Acquire Victoria Paper Recyclers Acquire DD & PR (QLD) • Support development and growth of acquired businesses • Continue to explore complementary acquisitions
Slide 19: Outlook
Freightways Outlook
Slide 20: Capital expenditure
Capital expenditure 2008 2007 Forecast Actual Capital expenditure $15.0m $17.8m Depreciation $8.0m $6.4m • 2007 capex included $8m Porirua land & buildings purchased • 2008 depreciation reflects progressive capitalisation of investment in core IT
Slide 21: Outlook
Outlook • Near-term performance will be influenced by NZ economic conditions • Investment in people, infrastructure and customer service initiatives (competitive advantage) will continue • Characteristics of competitive environment expected to remain unchanged • Consistent application of market spec
Slide 22: Summary
Summary 9 Strong successful business 9 Positioned to deliver continuing earnings growth 9 Delivering an attractive dividend yield