Brambles CEO, Tom Gorman announced his retirement yesterday after reporting another solid result for the country’s logistics multinational.
Mr Gorman will stay around until early 2017 (he will leave officially next June) and will be replaced by UK packaging executive Graham Chipchase in March next year. Mr Chipchase is currently the chief executive of packaging group Rexam. He will start as CEO-designate on January 1.
Brambles reported a 2015-16 underlying net profit of $US1.031 billion, in line with guidance of $1.015 billion to 1.035 billion.
Statutory profit fell 6 per cent to $US557.4 million, dragged down by $US78.1 million worth of write-downs and impairments, the bulk of which was related to the company’s oil and gas business.
The company will pay a final dividend of 14.5 A cents a share, up from 14 A cents a share for the final half of 2014-15making a full year payout of 29 cents a share.
Brambles said it expects revenue growth of 7%-9% on constant currency basis over 2016-17, with underlying profit tipped to rise 9% to 11% to between $US1.055 billion and $US1.075 billion (which indicates a slight fattening of profit margins).
Mr Gordman said: “In FY17, we expect to realise the benefit of the investment we have made to date in operational efficiencies, including the US Pallets durability program, which is expected to more than offset direct cost pressures.”
“My decision to retire was not easy but I believe this is the right time for me to leave,” Mr Gorman said yesterday.
"Brambles is in great shape, our strategy is sound, and our team is aligned and committed. I wish Graham every success and I am looking forward to my future away from full-time executive life."
He said Brambles’ net profit had been underpinned by strong performances in both developed and emerging market businesses.
There was also a significant boost in profit from the $155 million sale of Brambles’ LeanLogistics transport management software business.
Brambles’ Chairman, Stephen Johns, said in yesterday’s statement: “The 4% increase in Brambles’ total dividends for the 2016 financial year reflects the Board’s confidence in the Group’s ability to deliver sustainable profit growth and generate cash over the medium to long term.” Brambles shares finished on $13.25 yesterday on the ASX, down 0.1%.
