Global logistics and courier company Freightways booked a boosted after-tax profit for the year to June, but increasing economic headwinds are of growing concern for analysts.
Revenue for Freightways (FRE) was up 11% from $432.3million a year ago to $479.5million, earnings before interest, tax, depreciation and amortisation was up 13.8% from $83.9million to $95.5million, and reported after-tax profit rose 3.7% from $41.7million to $43.3million.
Craigs Investment Partners broker Chris Timms said while it was a ''good result'' for the full year, he noted most growth came from a strong first half, with management attributing the softer second half to a slowdown in the fourth quarter.
''There are concerns over the slowing economy impacting on express package trading conditions,'' he said.
FRE shares were up almost 1% at $5.60 after the announcement.
Forsyth Barr broker Andrew Rooney said the result was ''broadly in line with market expectations'', and also noted the slower fourth quarter.
''Management suggests that the rate of organic growth in express package [division] slowed through full year 2015, particularly during the fourth quarter,'' Mr Rooney said.
Management expected growth for express packages in the year ahead to be consistent with that during fourth-quarter 2015, he said.
FRE's shares had come under pressure during the past three months, which was consistent with slowing domestic activity.
The company said all businesses in its express package and business mail division had improved revenue and earnings from the previous year's.
''Increased volumes from within our existing customer base, quality new business wins and some improved pricing all contributed to this result,'' it said.
Growth in information management on both sides of the Tasman had been ''consistently strong'' throughout the year.
The document destruction businesses, particularly Shred-X in Australia, saw increased demand for services and improved prices from the sale of shredded paper for recycling.
However, LitSupport, acquired in December 2014, was not yet trading to expectations and if earnings targets were not achieved by December this year, up to $A5million ($NZ5.63million) of the purchase price would be reimbursed by the vendors.
Freightways
Express package and business mail division.
Operating revenue up 8% to $360 million. Includes New Zealand Couriers, Post Haste, Castle Parcels, NOW Couriers, SUB60, Security Express, Kiwi Express, Stuck, Pass The Parcel, DX Mail and Dataprint.
Information management division.
Operating revenue up 18% to $122 million. Includes the Online Security Services, Archive Security, Document Destruction Services and Data Security Services brands in New Zealand and the Information Management Group, DataBank, Archive Security, Filesaver, LitSupport and Shred-X in Australia.
Source: Freightways
