Lindsay sees profits slide while investment grows


Fleet renewal and facilities strategy continue as company looks to rebound in next 12 months

Lindsay sees profits slide while investment grows
More B-doubles are boosting Lindsay's performance

 

Trucking and rural supplies company Lindsay Australia’s facilities expansion is making progress but its profits are at the mercy of operational costs.

Despite a 9.5 per cent jump in revenues to $314 million, Lindsay’s annual net profits fell by the same percentage to $6.5 million, its annual report shows.

In the face of that, directors expect to report a profit boost in 12 months’ time, with revenues of about $340 million foreseen on higher yielding freight, improved capacity utilisation and "maintaining inflation adjusted operating cost structures".

This year, the transport division bore the brunt, with smaller rural showing a divisional profit rise.

Transport’s $18.8 million profit was down $1.7 million on last year, with Lindsay saying retrospective fuel tax credits were down to $1.1 million from $3.6 million previously.

With good news on several other levels, costs growth hindered bottom line growth.

"Linehaul labour costs per kilometre increased 9.1 per cent due to rate increases," the company reports.

"Other labour costs (administration and pickup and delivery driver), excluding mechanical labour, increased by 13 per cent compared with an overall increase in revenue of 11.7 per cent."

That comes against a backdrop of a 1 per cent increase in subcontractor-generated revenue to 28 per cent.

Vehicle repair and maintenance costs, including labour, were up 12.3 per cent, or 11 per cent per kilometre travelled.

Helping out was a reduced accident rate, translating to a $1.4 million insurance saving.  

Fuel costs were up from $33.6 million to $40.7 million.

Lindsay’s fleet renewal continues at a slightly slower pace, with capital expenditure on plant and equipment $2.1 million lower than last financial year, at $19.5 million.

B-doubles now make up more than 85 per cent of the fleet and this coming year’s expenditure is to be lower again at $16.8 million.

The upgrade’s impact in reflected in its statistics.

The 54.1 million of fleet kilometres travelled was up 3.6 per cent but better capacity utilisation resulting in this increase being lower than the increase achieved in revenue for company vehicles of 9.6 per cent.

This was due to both the fleet upgrade and an increase in average revenue per vehicle movement, Lindsay says.

On the facilities front, its Mackay depot opened in August last year, the operations of which coincided with a 25 per cent growth in north Queensland revenues.

The company has signed a conditional contract on 22,500 square metres at Direck in outer Adelaide intended as a new transport facility in that city.

And it announced the establishment of Lindsay Fresh Logistics (LFL), based in the Brisbane Produce Markets at Rockea, in mid-July.

That enterprise has a 5,000 square metre temperature controlled facility which also hosts all Lindsay Transport’s Brisbane produce operations.

LFL unloads and tranships Lindsay and other companies’ produce, along with providing and ripening service and storage.

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