Freight activity, flooring logistics and warehousing volumes growth help
CTI Logistics has executed a significant annual results rebound.
The Western Australian-based national transport and logistics group scored an $8.17 million profit on a revenue rise from operations up 11.1% to $239 million.
“During the year the company has invested in growing our national freight operations in Sydney, Adelaide and Perth, including the relocation of two transport depots in Perth and Sydney and a warehouse in South Australia,” the company’s directors stated in the annual report.
“Investment has continued in information technology at GMK (specialised flooring logistics) and warehousing divisions to enhance our operating systems and performance as well as a cyber security investment in ongoing managed services to protect our IT systems network.
“Despite the challenging market conditions, operating cash flow has remained strong at $31,087,414 for the year, being a 33% improvement on the prior year,” they added.
“The group’s receivables and cash flow management remained well controlled with debtors’ days outstanding in line with the prior year.
“With a diverse and large customer base, the strength of the group’s focus on receivables management is reflected in the value of receivables written off during the year representing only 0.02% of revenue.”
Read how things were going for CTI this time last year, here
The pleasing result came despite a rise in vehicle and transport costs from $26.8 million to $28.2 million, subcontractor outgoings up from $71.2 million to $80.3 million and employee benefits up $71.3 million to $74.9 million.
On a segment basis, the transport arm saw profits before tax rise from $3.9 million to $5.5 million on revenue that rose from $144.4 million to $162.8 million.
The logistics arm had profits before tax up from $196,684 to $6.5 million on revenue that jumped from $82 million to $93.2 million.
Vehicle sales income rose from $170,981 million to $233,940 million, while that form plant and equipment fell from $23,425 to $9,940.
The company put the performance down to:
- strong revenue growth in transport volumes including interstate from Sydney, WA regional freight and WA metro freight activity
- strong revenue growth in both flooring logistics and warehousing volumes across all sites
- improved margins as a result of volume increases, a focus on quality revenue and cost savings as a result of ongoing cost control measures offset in part by increasing wage costs in particular due to lack of available staff, site relocations and ongoing issues with interstate linehaul services
- productivity gains flowing from ongoing improvements from successful system implementations.
“The company continues to generate strong cash flow and later this year will commence the development of a transport hub on our undeveloped land at the Hazelmere site,” executive chairman Don Watson said in a letter to shareholders.
“The company is well-placed to take advantage of and benefit from any uplift in the economy.”