Announcement
INTERIM: TLL: TLL - 1H19 Interim Results
09:10am
TLL
25/02/2019 09:10
INTERIM
PRICE SENSITIVE
REL: 0910 HRS TIL Logistics Group Limited
INTERIM: TLL: TLL - 1H19 Interim Results
TIL LOGISTICS DELIVERS SALES UPLIFT IN ALL SECTORS FOR HALF YEAR
For the six months to 31 December 2018 (1H19)
o TIL Logistics Group has delivered a period of business growth with
increasing sales across all business sectors.
o Excluding 1H18 non-trading costs, 1H19 EBITDA was in line with the previous
first half year as expected, despite a continuation of the higher operating
costs noted in 2H18, increased corporate costs following the reverse listing
and ongoing investment in growth initiatives and acquisitions which will
provide long term value for TIL.
o The company has reported a 1H19 NPAT of $4.0m reflecting a full period of
operation as a listed company and associated costs, increased interest
expense due to higher debt levels post the reverse listing, and interest and
depreciation expenses associated with the acquisition of Specialised Lifting
and Transport Group in November 2018.
o The Board is confident in the company's progress and strategy and has
declared a half year dividend of 2.5 cents per share.
o The company has confirmed it remains on track to achieve FY19 guidance of
EBITDA of $28m to $32m and NPAT of $7.8m to $8.8m.
(see attached announcement for summary financial table)
New Zealand freight and logistics company, TIL Logistics Group Limited (NZX:
TLL, "TIL"), has reported a period of business growth and increasing sales as
it benefits from its bundled transport and logistics offer.
This is the first time the company has reported on a full first-half period
as a listed company, following the completion of the reverse listing in
December 2017. Highlights for 1H19 include the renewal of two significant
customer contracts (with Z Energy and Farmlands), acquisition of Specialised
Lifting and Transport Group (SLTG), the establishment of the Senior
Leadership Team, investment in new warehouse capacity and organic business
growth.
Sales revenue and total income continued to trend upwards, with particularly
strong sales performances from Freighting and Warehousing & Logistics due to
high pre-Christmas demand for both transport and warehousing across New
Zealand, as expected. A two-month contribution was received from SLTG
following its acquisition in November 2018, which included the usual seasonal
slowdown in December.
Compared to 1H18, the 1H19 result reflects a full period of operation as a
listed company, with a full six months of corporate costs (up $1.1m on 1H18),
including the expanded leadership team and increased governance costs.
The increased operating costs noted in 2H18 have continued into this year and
continue to rise at a faster rate than CPI. As previously advised, changes in
the operating environment have seen higher fuel prices, road user charges and
regional fuel taxes, increased wage costs and higher costs for parts and
equipment due to the lower exchange rate. TIL has offset some of the higher
fuel costs through a supply contract with Z Energy as part of the renewed
strategic partnership.
In addition, TIL's own growth initiatives as well as operational changes have
seen an increase in property rent costs, wages and fleet lease costs. In
particular, the expansion of warehousing facilities has seen property costs
increase, however, the company now has substantial additional capacity to
meet future demand. TIL is also leasing more trucks rather than buying them,
which has seen lease costs increase, and is benefitting from the
establishment of an expanded Senior Leadership Team during the period
including the creation of new CEO, CIO and Group HR roles.
Despite the additional costs (and excluding FY18 non-trading costs), 1H19
EBITDA was in line with the previous year.
Debt levels increased following the borrowing incurred in December 2017 at
the time of the reverse listing, and with ongoing investment in growth
initiatives including new warehousing facilities and the acquisition of SLTG.
The 1H18 result also included a $0.5m prior year tax adjustment.
TIL has reported a 1H19 net profit after tax of $4.0m as it continues to
increase sales and invest in growth initiatives which will provide long term
value.
The Board remain confident in the company's progress and strategy and has
declared a half year fully imputed dividend of 2.5 cents per share.
Outlook
With growing demand for professional and expert transport and logistics
solutions, TIL is well positioned to take advantage of market dynamics and
growth opportunities. Management will continue to focus on growing the
business, both by strengthening existing services and entering new sectors.
Several smaller bolt-on acquisitions are currently under consideration and
TIL is investing in five new warehousing facilities to meet future demand.
One warehouse at Tauranga opened at the start of December 2018 while two more
warehouses in Christchurch and Auckland will open from April 2019, with a
further two by the end of 2019. The company has also identified growth
opportunities in International freight forwarding, and non-fuel Bulk Liquid
haulage.
Second half performance is expected to be in line with the first half. The
company confirms FY19 guidance to be EBITDA of $28m to $32m and NPAT of $7.8m
to $8.8m, taking into account the higher operating and corporate cost base,
the investment into new warehouses and a partial year contribution from new
acquisitions.
CEO of TIL, Alan Pearson, said: "Customers are increasingly demanding a
transport and logistics partner who can provide a safe and sustainable New
Zealand-wide transport, storage and metro delivery service. TIL's expertise
in the freight and logistics sector means we are well set up to meet all our
customers' needs. Our bundled transport and logistics offer is now starting
to show dividends, and our market share is growing, with a number of new
customers and increasing demand from existing customers.
"With our scale, reach, and depth of experience, we can work our assets and
networks more efficiently and manage our costs. We have the financial
strength to expand by acquisition where it adds long term value and we remain
focused on growing our existing businesses by building our customer base and
providing a wider range of services."
ENDS
End CA:00331017 For:TLL Type:INTERIM Time:2019-02-25 09:10:03
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