Brambles says its first-half profit rose 9%, but it has downgraded expectations for full year earnings growth, news that helped knock the shares lower in yesterday’s sell-off.
The shares fell 3.7% or 27c to $7 in a market that was shaken by the upturn in fears about Greece and fell close to 2%.
Brambles said half year profit was $US239.50 million ($A224.92 million), up 18% from the previous corresponding period.
Sales revenue jumped 34% for the half to $US2.78 billion from the previous corresponding period. That included the Recall business which was sold off.
Brambles said that excluding Recall, revenue was also 34% higher at $2.3 billion for the year.
Operating profit from continuing operations was US$371.7 million, up 21% after significant items of US$13.4 million.
Underlying profit, which excludes Significant items, was US$385.1 million, up 23%, reflecting sales growth.
Brambles CEO Tom Gorman said that despite challenging economic conditions, the company continued to grow its business by adding new customers.
"We have positive momentum with our growth strategy of diversifying our range of products and services and expanding geographically," Mr Gorman said.
But caution saw Brambles downgrade its guidance for the full financial year for underlying profit of a range between $US1.050 billion and $US1.080 billion ($A986.10 million and $A1.01 billion) at June 30, 2011 foreign exchange rates.
"This guidance remains subject to unforeseen circumstances and economic uncertainty," the company said in a statement.
The company said the increase in revenue reflected the inclusion of the IFCO Systems businesses acquired in March 2011, other acquisitions and continued new customer growth from the three pooling solutions segments of Pallets, Reusable Plastic Crates (RPC) and Containers.
"The turnaround of CHEP (Commonwealth Handling Equipment Pool) continues to progress in the USA, Brambles’ largest single country of operation, as illustrated by strong new business wins, returning customers, improving pricing conditions," said Mr Gorman.
Brambles declared a partially franked (20%) interim dividend of A$13c per share, unchanged from the first half of the 2010-11 financial year.
And shares in rail operator QR National fell yesterday after the group revealed a sharp fall in first half profit that exceeded some forecasts.
The big driver for the fall was the drop in the amount of coal carried on railroads, thanks to the impact of the floods and big wet across much of Queensland last year, especially in the central Queensland coal fields which have taken longer to recover from the flooding than expected.
It was QRN’s first-half net profit as a listed company and despite the 32% drop in earnings, it is still confident that it will see higher coal haulage volumes in the second half of the year after the impact of floods.
QRN said net profit for the six months to December 31 was $189.3 million, down from $278 million in the previous corresponding period.
The shares fell 5c to $3.71.
A turnaround in one-off items relating to the company’s privatisation, from a $37.8 million gain in the previous corresponding period to an $8.8 million impairment the six months to December, was the main reason for the net profit decline, QR said.
First-half revenue of $1.715 billion was up 1.4% from the previous corresponding period.
"The company’s focus on execution and business reform has delivered solid first-half earnings growth despite a tough macro environment dominated by the lingering impacts of the Queensland floods on mine outputs and haulage volumes," CEO Lance Hockridge said in a statement.
"The amount of tonnes of coal QR hauls in the full year was now expected to be at the lower end of its previous guidance of 200 to 210 million tonnes," he said.
"Coal volumes in HY12 (will be) impacted by production issues for our customers including the lingering impacts of the 2011 QLD floods as well as industrial relations issues
"Our current view is that we will deliver around 200mt –the low end of previous guidance provided. This is subject to normal seasonal rainfall and customers returning to pre-flood production levels
"FY12 EBIT guidance remains in accordance with the Offer Document with volume downside expected to be offset by delivering through the transformation program
"FY12 capital expenditure expected to be $1.1bn due to deferrals of uncommitted projects
"Earnings for the full year are still expected to be $578 million," he said.
QR declared an unfranked interim dividend of 3.7c per share.
It was known to be on the way, but the result yesterday from Goodman Fielder, was truly horrible.
The company will not be paying an interim dividend after reporting a 77% slide in profit, on a near 4% drop in revenues.
It’s no wonder the shares dropped nearly 6% to 48c yesterday, a fall of 3c on the day.
