Freightways starts the year well

Press, 2 December 1981, Page 28

Freightways starts the year well

The year had started well for Freightways Holdings, Ltd. with results for the first three months ahead of last year and also ahead of budget, the chairman (Mr J. A. Valentine) told shareholders at the annual meeting in Wellington. Continuing growth was expected during the present year, Mr Valentine said. Capital spending during the year was $10.2M, compared with S6.IM in 1980. This reflected continuing programmes of expansion of equipment replacement and investment. About SBM of this was generated from internal cash flow, and only a relatively small sum from external borrowing, a situation which reflected the strength of the group. Mr Valentine said that as a result of this the company was well placed to achieve further growth — in particular in heavy haulage international freight forwarding, security services, courier services, and the tyre division. In discussing the company's profit performance, Mr Valentine said inflation at rates being experienced in

New Zealand was of concern. “Of particular worry is that New Zealand's future rate of inflation will be about twice the average of the countries with which we trade. “Such a situation can only be disadvantageous to everyone in New Zealand, and we must be firm in opposing courses of action which promote inflation.” Mr Valentine pointed out that Freightways was less affected than most companies in the need for additional funds arising from inflation because many of its operations were serviceoriented and did not have extensive stocks or require, high capital investment. This situation continued to give Freightways a financing advantage compared with many other companies. The company's accounts showed that operating had been well maintained and after allowing for a dividend there was a substantial profit retention of more than S2M for the year. In addition there was a net surplus of S7M arising from revaluations to current values of fixed assets.