MaxiTrans sees order book up as annual loss hits


Trailer-maker sinks into red due to impairments and one-off costs

MaxiTrans sees order book up as annual loss hits
Federal employment support has helped the company

 

MaxiTrans has recorded a net after tax loss of $35.5 million as the trailer-maker joins many other listed companies in a sea of red ink during this annual reports season.

This represents a fall of 31.3 per cent on a 9.9 per cent revenue fall to $317.5 million and the dip into the red is put down to "impairments and other non-underlying costs" of $36 million after tax.

Most of this effort is centred on the main plant in Ballarat.

"Despite these measures delivering a $10.1m benefit, these weren’t significant enough to offset the decline in volume, mix and manufacturing overhead recoveries of $17.1m," the company states.

The trailer segment’s revenues fell 15.4 per cent to $205.5 million, though it is noted the second half of last year was better than the first half.

There was also extra income from federal government pandemic employment aid of $5.15 million.

Given much of the current position is outside its control, the company will see a silver lining in the order bank at June 30 being 40 per cent higher than this time last year, as a result of stronger agricultural markets and good orders in support of the food and grocery sector. 


Read about the MaxiTrans recruitment drive in the midst of the pandemic, here


The MaxiParts business stands up the best of the segments, defying the downturn with revenues steady at $130.8 million and gross earnings up from$8.7 million to $13.2 million.

Executives will also be happy to have reduced net debt 62 per cent to $12 million and found efficiency savings of $8.4 million, with another $1.6 million to be saved this financial year.

Notable developments during the coming financial year include relocation due in the second quarter of Queensland manufacturing operations from Richlands to a purpose built $4 million facility at Brisbane’s Carole Park.

The move is expected to generate manufacturing efficiencies of more than $2.3 million a year "plus add product portfolio flexibility".

"It is expected market conditions in the Australian trailer market will continue to be slow as the impact of Covid-19 is compounding the already low levels of consumer confidence and other macro-economic drivers remain soft while operators continue to age their fleets," the company says of its expectations for the coming year.

"This has the potential to affect performance in both the MaxiParts business as well as the Australian trailer business.

"MaxiParts has shown strong resilience through the Covid -19 period to date and whilst growth may be slower, the underlying business is expected to remain strong.

"The Australian trailer business has been supported in offsetting this risk through the Australian federal government incentive to increase the instant asset write off threshold from $30,000 to $150,000 (through to 31 December 2020) combined with the 15 month investment incentive (through to 30 June 2021) and is expected to continue to benefit the Trailer Solutions business during this period.

"Rains in South Eastern Australia should also support a higher production rate of Bulk Tipper trailers during the grain season in H1 FY21.

"In the short term, order intake is improving, in food and grocery, general freight and tipper sectors, benefiting the Group’s Maxi-Cube, Freighter, Hamelex White and Lusty products.

"These product lines are directly affected by the broader economic conditions, the crop outlook and the timing of commencement of new housing and infrastructure projects."

 

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