Mainfreight will pay a discretionary bonus of $43.9 million, up 61% from last year's bonus of $27.3m, after a record result to March which saw net profit up by $40.1m to $188.1m.
The multinational logistics and transport group announced a year end dividend of 45 cents a share, taking the full dividend for the year to 75c, up 27% on the prior year.
Possibly more important for its team of 8,000, the firm more than doubled its Christmas bonus for 2020, from $5.35m to $11m.
Revenues were up $448.4m to $3.5 billion, a 14.5% increase on the prior year, with 76% of that now generated outside New Zealand.
Group managing director Don Braid said it was a significant result for the Mainfreight family, achieved during a “tumultuous time in the world’s history” and with success in every one of the five regions the company operated.
In his results commentary, Braid said the results were pleasing in light of initial supply chain disruptions during the early part of the year, on the back of lockdowns in response to the global pandemic.
In that respect, NZ was the worst effected with weekly revenues during April 2020 down by about 40% on average levels.
But, he said, the group’s response at the outset of the pandemic had been unequivocal. “Look after our people, look after our customers, guard our cash, and embrace the opportunities that may arise.”
While the group had deferred capital expenditure during early 2020, it had recommenced land and building projects during the year, with net capex totalling $118.6m, of which land and buildings accounted for $58.9m, plant and equipment $26m, fit out costs of $15.6m and information technology another $18m.
Buying spree
The company now expects to spend an additional $338m for property over the next two years, with $156m of that during the current financial year. That includes a new facility for Owens Transport in Penrose, Auckland and additional land in Nelson, Hastings, Cambridge and Wellington.
Regionally, the NZ business saw an increase of 11.5% in profit before tax to $97.8m, though supply chain capacity into and from NZ remains congested, and the company is “frustrated with international shipping lines".
The Australian business reported a 46.6% jump in profit before tax to A$71.5m for the year, on the back of regional expansion of the group’s transport business.
Mainfreight’s two new build warehouses, a 50,000 square metre facility in Sydney and 30,000sqm build in Melbourne, are scheduled for completion by end next year.
The firm’s European business – where it has a footprint of more than 330,000 sqm of warehousing – saw a 23.4% improvement in profit before tax to €22.35m, despite extensive lockdowns across the continent, many of which were ongoing.
The company also noted Brexit issues between the UK and Europe remained a cause of frustration, particularly since January, resulting in “considerable delays to freight” on the back of more complicated customs formalities.
Business in the Americas also saw an improved performance, with a 29.7% increase in profit to US$25.93m, with Mainfreight's air and ocean division benefiting from resurgent demand from customers and market share gains in the US.
The Asian business saw profits more than double to US$7m, driven by increases in market share and rate increases from both air and see freight, the firm said.
Braid said that while Mainfreight’s people can be proud of the way they “stood up to be counted”, there would continue to be uncertainty with heavily congested supply chains continuing to affect the world’s freight lanes.
But, he said the first seven weeks of trading in the current year has been at similar levels to the past six months.
“We continue to be optimistic and we are bloody proud of our people who have delivered this record result.”
