Brambles profit slumps 30pc, but 'wood still better'

Pallet supplier Brambles suffers 30 percent profit slump, demonstrating dramatic freight downturn

Pallet supplier Brambles has suffered a 30 percent profit slump in a sign of the dramatic freight downturn, but the company remains pleased given the current economic climate.

The Australian-based global supply chain giant announced 30 percent profit fall during its annual results today, posting $ 544.7 million in revenue.

Brambles says the addition of new customers like Nestle, and a mega deal signed with Wal-Mart in the United States, has ensure its prized CHEP brand has remained strong throughout the world, despite massive spending cuts by businesses and individuals.

"This result demonstrates the continued resilience of our business," Brambles CEO Mike Ihlein says.

"CHEP as a global business is helping make the world’s supply chains more efficient , providing visibility to supply chain costs and delivering value for customers."

Ihlein also played down suggestions Brambles would have to change their pallets from wood to plastic in order to stay competitive, given the emergence of rival companies such as iGPS which secured a mammoth contract with beverage giant Pepsi Co earlier this year.

Ihlein says wooden panels are a better option given they are a "renewable energy source".

The company will benefit from increased environmental awareness once the issue of the weakened economy falls away, he says.

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