New Zealand-based transport company Mainfreight has reported an increase in profits of 2.5 per cent and a reduction in costs, despite the difficult trading conditions.
The Mainfreight Group has reported a net surplus after taxation and abnormal items of $36.37 million for the twelve months of its 2010 financial year, an increase of 2.5% on the previous year’s result of $35.48 million.
Total revenue (sales) decreased by 10.5% to $1.13 billion, from $1.26 billion last year (excluding foreign exchange, this represents a decrease of 10.3%). EBITDA declined 6.7% to $75.85 million.
Included in these results is a $3.04 million ($2.09 after tax) discretionary bonus for teams throughout the world, wherever branch performance bettered that of the previous year. A total of 55 branches and 1,104 team members will participate.
The previous year’s discretionary bonus was forgone by all people as a measure to address the deteriorating economic conditions. Team bonuses, while discretionary, are an integral part of the Mainfreight business model.
Abnormal items totalled $1.89 million; $800k related to leases surplus to requirements and the balance predominantly to restructuring costs incurred in the Mainfreight USA operations. Abnormal costs for the previous year totalled $4.5 million.
The company’s response to the decline worldwide in trading conditions was to manage cost structures better, improve margins, and aggressively expand market share by increasing sales activities.
Mainfreight has continued to open new branches in China, New Zealand and Australia, and continued to identify new areas to extend its services around the world.