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Freightways Annual Roadshow: Introduction, Industry, Financial Performance, Recent Events

This presentation provides an overview of Freightways, its business strategy, financial performance, recent events, and outlook. It covers the express package and information management industries, as well as the company's multi-brand strategy and business mail segment. The presentation highlights Freightways' strengths, growth opportunities, and financial performance. It concludes with a summary of the company's position and future prospects.

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Freightways Annual Roadshow: Introduction, Industry, Financial Performance, Recent Events

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  1. Fisher Funds Annual Roadshow August 2004

  2. Presentation • Introduction to Freightways • Industry, business description and strategy • Financial performance • Recent events and outlook

  3. Introduction • Listed on the NZX September 2003 • Established in 1964 • Express package, mail, information management • Approx. 7,000 retail and institutional shareholders • Revenue $214m, EBITA $41m, NPAT $16m

  4. A Survivor • Freightways’ businesses have survived: - Regulated / deregulated road transport industry - Substitute services: fax machine and email - Many competitors - Three owners in the last two years

  5. Express Package Industry Overview and Business Description

  6. Express Package Industry • Two segments to Express Package industry • Network couriers 90% of industry revenue • Point-to-point couriers 10% • Services embedded in supply chains of businesses • Consolidated industry structure • Growth underpinned by demand for Just in Time supply

  7. Business Description - Strengths • Network of independent contractors • Dedicated express package linehaul network • Operational excellence and profit culture • Experienced people • Established multi-brand strategy

  8. Price Service Multi-Brand Strategy Three major brands: • Differentiated by price and service • Captures growth across entire market • Provides defence against competitive threats Freightways’ Network Courier Brands

  9. Information Management and Business Mail Industry Overview and Business Description

  10. Information Management • Well positioned in each niche • Offers a total information management solution • Integrated with express package operations • Records management growth opportunity

  11. Business Mail • Niche player in deregulated postal services industry • Postal deregulation enabled expansion of DX Mail • Growth opportunities in business mail segment • Drives volume to New Zealand Couriers

  12. Business Strategy

  13. Business Strategy • Revenue growth from existing and complementary markets: • Increase volumes from existing customers • Gain new customers • Achieve some price improvements • Converted into strong earnings growth: • Ability to grow volume at low incremental cost • Volume growth drives efficiencies/productivity gains • Maintenance of margin integrity • Continued focus on cost control • Explore incremental acquisition opportunities

  14. Financial Performance

  15. Operating Revenue • 10% revenue growth in 2004 • 5 year compound average revenue growth of 7%

  16. EBITA • 27% EBITA growth in 2004 • 5 year compound average EBITA growth of 18%

  17. Recent Events and Outlook

  18. Recent Events • Transition to a listed NZ company Sept. 2003 • Acquisition of Archive Security • Actual 2004 financial performance exceeded IPO forecasts on all fronts

  19. Outlook • Economy favourable from Freightways’ perspective • No change expected in Freightways’ operating environment • Sustained focus on core business / core strategies • Business as usual

  20. Summary • Strong successful business • Positioned to deliver continuing earnings growth • Delivering an attractive dividend yield

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