Mainfreight half-year profit up 23%

The country's largest transport company, Mainfreight, has posted a strong half-year profit after a slow start to the year.

Net profit increased by 23 percent to $72.9 million for the six months to September after strong trading in Australia and New Zealand.

Revenue increased by 7 percent to $1.6 billion as the company grew its market share in Australia and benefitted from an increasing consumer demand.

The result was in line with forecasts made by the company recently.

"[It has been] a pleasing half-year result considering the slow start to the year through the Covid-19 lockdowns in the various countries and regions," the company said in a statement.

New Zealand domestic volumes, which accounted for more than a third of the group's profit, were up by 8 percent to $37.5m, with Australia up by more than 100 percent to $32.6m and Asia up nearly two-thirds to $5.8m.

Profits in the US and European markets were down by about 12 percent because of reduced freight movements and the economic effects of Covid-19.

It said the pandemic had put pressure on global supply chains resulting in lower levels of inventory in its warehouses and the capacity constraints on ships and planes, eating into its margins in some markets.

"Strong consumer demand and congested international supply chains are proving to be challenging for our customers and people alike."

"The current conditions are however providing opportunities for more growth and attracting new customers, as they look for improved service and more certainty in their freight and inventory management."

The company said it expected to see improvement across all its markets, especially in the run-up to Christmas.

"This confidence provides us with greater certainty to further invest in our network, with more regional expansion underway, and to increase our commitment to more land and buildings where appropriate."

The half-year dividend has been raised 5 cents to 30 cents per share.