Mainfreight Full Year Results to 31 March 2018

PRELIMINARY FULL YEAR REPORT ANNOUNCEMENT
Mainfreight Limited
For Full Year Ended 31 March 2018
Preliminary full year report on consolidated results (including the results for the previous corresponding full year).
This report has been prepared in a manner which complies with generally accepted accounting practice and fairly
presents the matters to which the report relates and is based on unaudited financial statements,
which are in
the process of being audited. The Listed Issuer has a formally constituted Audit Committee of the Board of Directors.
Income Statement for the Year Ended 31 March 2018
Note20182017
$000$000
Operating Revenue2,618,349 2,333,088
Interest Income511 503
Total Revenue2,618,860 2,333,591
Transport Costs(1,607,317) (1,432,556)
Labour Expenses Excluding Share Based Payments(538,483) (476,256)
Occupancy Expenses(73,192) (65,792)
Depreciation and Amortisation Expenses(47,788) (43,492)
Other Expenses(183,941) (160,942)
Finance Costs(7,567) (7,728)
Non-cash Share Based Payment Expense- (55)
Profit Before Abnormal Items and Taxation for the Year160,572 146,770
Income Tax on Profit Before Abnormal Items(48,353) (43,606)
Net Profit Before Abnormal Items for the Year112,219 103,164
Abnormal Items4(7,224) (2,448)
Income Tax on Abnormal Items42,898 807
Abnormal Items After Taxation4(4,326) (1,641)
Profit Before Taxation for the Year153,348 144,322
Income Tax Expense(45,455) (42,799)
Net Profit for the Year107,893 101,523
Earnings per share for profit attributable to the ordinary equity holders of the company are:
CentsCents
Basic Earnings Per Share:Total Operations107.14101.10
Diluted Earnings Per Share:Total Operations107.14100.97
Statement of Comprehensive Income for the Year Ended 31 March 2018
Net Profit for the Year107,893 101,523
Other Comprehensive Income
Other comprehensive income to be reclassified to profit or loss in subsequent periods:
Exchange Differences on Translation of Foreign Operations(1,988) (5,260)
Income Tax effect3,371 (2,155)
Net Other comprehensive income to be reclassified to profit (loss) in subsequent periods1,383 (7,415)
Other comprehensive income not to be reclassified to profit or loss in subsequent periods:
Revaluation of Land including Foreign Exchange Movements638 (789)
Income Tax effect- -
Net Other comprehensive income not to be reclassified to profit (loss) in subsequent periods638 (789)
Other comprehensive income not to be reclassified to profit or loss in subsequent periods:
Defined Benefit Pension Provision325 (635)
Income Tax effect(137) 215
Net Other comprehensive income not to be reclassified to profit (loss) in subsequent periods188 (420)
Other Comprehensive Income for the Year, Net of Tax2,209 (8,624)
Total Comprehensive Income for the Year, Net of Tax110,102 92,899

Balance Sheet as at 31 March 2018
Note20182017
$000$000
Current Assets
Bank80,521 75,312
Trade Debtors361,737 314,888
Income Tax Receivable270 1,829
Properties Held for Sale7,852 -
Other Receivables60,811 48,008
511,191 440,037
Non-current Assets
Property483,488 484,244
Plant & Equipment98,822 86,462
Software49,374 43,086
Goodwill207,919 200,721
Brand Names7,863 10,546
Other Intangible Assets9,164 10,814
Deferred Tax Asset8,581 8,855
865,211 844,728
TOTAL ASSETS1,376,402 1,284,765
Current Liabilities
Bank36 947
Trade Creditors & Accruals295,000 261,206
Employee Entitlements53,373 47,907
Provision for Taxation12,323 14,121
Finance Lease Liability2,077 1,801
362,809 325,982
Non-current Liabilities
Bank Term Loan270,753 283,029
Employee Entitlements3,634 3,800
Deferred Tax Liability22,296 23,879
Finance Lease Liability4,507
2,473
301,190 313,181
Shareholders' Equity
Share Capital85,821 85,821
Retained Earnings586,211 521,619
Revaluation Reserve51,254 50,616
Foreign Currency Translation Reserve(10,651) (12,034)
Defined Benefit Pension Reserve(232) (420)
TOTAL EQUITY712,403 645,602
TOTAL LIABILITIES AND EQUITY1,376,402 1,284,765
The accompanying notes form an integral part of these financial statements.

Statement of Changes in Equity for the Year Ended 31 March 2018
2018ForeignDefined
Asse
tCurrencyBenefit
$000OrdinaryRevaluationTranslationPensionRetained
SharesReserv
eReserveReserveEarningsTotal
Balance at 1 April 201785,821 50,616 (12,034) (420) 521,619 645,602
Profit for the Year- - - - 107,893 107,893
Other Comprehensive Income- 638 1,383 188 - 2,209
Total Comprehensive - 638 1,383 188 107,893 110,102
Income for the Year
Transactions with Owners in Their Capacity as Owners:
Supplementary Dividends- - - - (1,497) (1,497)
Dividends Paid- - - - (43,301) (43,301)
Foreign Investor Tax Credit- - - - 1,497 1,497
Balance at 31 March 201885,821 51,254 (10,651) (232) 586,211 712,403
2017ForeignDefined
Asse
tCurrencyBenefit
$000OrdinaryRevaluationTranslationPensionRetained
SharesReserv
eReserveReserveEarningsTotal
Balance at 1 April 201673,912 52,303 (4,619) - 459,477 581,073
Profit for the Year- - - - 101,523 101,523
Transfer of Revaluation Reserve for Land Sold -(898) - - 898 -
Other Comprehensive Income- (789) (7,415) (420) - (8,624)
Total Comprehensive - (1,687) (7,415) (420) 102,421 92,899
Income for the Year
Transactions with Owners in Their Capacity as Owners:
Shares Issued11,854 - - - - 11,854
Executive Share Scheme Costs 55 - - - - 55
Supplementary Dividends- - - - (1,212) (1,212)
Dividends Paid- - - - (40,279) (40,279)
Foreign Investor Tax Credit- - - - 1,212 1,212
Balance at 31 March 201785,821 50,616 (12,034) (420) 521,619 645,602

Cash Flow Statement for the Year Ended 31 March 2018
Note20182017
$000$000
Cash Flows From Operating Activities
Receipts from Customers2,580,429 2,307,424
Interest Received511 503
Payments to Suppliers and Team Members(2,388,030) (2,132,227)
Interest Paid(7,567) (7,729)
Income Taxes Paid(45,107) (36,745)
NET CASH FLOWS FROM OPERATING ACTIVITIES140,236 131,226
Cash Flows From Investing Activities
Proceeds from Sale of Property, Plant & Equipment4,507 5,822
Proceeds from Sale of Software46 38
Repayments by Team Members213 4
Purchase of Property, Plant & Equipment(51,509) (47,696)
Purchase of Software(17,726) (19,603)
Advances to Team Members(10) (212)
Establishment of Franchises and Acquisition of Subsidiaries(250) -
NET CASH FLOWS FROM INVESTING ACTIVITIES(64,729) (61,647)
Cash Flows From Financing Activities
Proceeds of Long Term Loans1,974 -
Proceeds of Share Issues- 11,854
Dividend Paid to Shareholders(43,300) (40,279)
Repayment of Loans(28,441) (57,131)
NET CASH FLOWS FROM FINANCING ACTIVITIES(69,767) (85,556)
NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS5,740 (15,977)
Net Foreign Exchange Differences380 (2,394)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD74,365 92,736
CASH AND CASH EQUIVALENTS AT END OF PERIOD80,485 74,365
Comprised
Bank and Short Term Deposits80,521 75,312
Bank Overdraft(36) (947)
80,485 74,365
The accompanying notes form an integral part of these financial statements.

1Corporate Information
The preliminary full year report announcement of Mainfreight Limited ("the parent") and its subsidiaries ("the Group")
for the year ended 31 March 2018 were authorised for issue in accordance with a resolution of the Directors.
Mainfreight Limited is a company limited by shares incorporated in New Zealand whose shares are publicly
traded on the NZX Main Board (New Zealand Stock Exchange).
2
Accounting Policies
Accounting policies remain consistent with the 2017 prior year financial statements.
3
Required NZX Disclosures
Movements in Ordinary Shares on Issue
20182017
SharesShares
Closing Balance100,698,548 100,698,548
Average Balance During Year100,698,548 100,417,298
In June and July 2016 a total of 1,125,000 redeemable ordinary shares were fully paid by the participants at an average
price of $10.56 per share.
At 31 March 2017 and 31 March 2018 there were no partly paid shares outstanding.
Net Tangible Assets
20182017
$000$000
Net Tangible Assets487,457 423,521
Net Tangible Assets per Security (cps)484.08421.76
Net Tangible Assets includes Software and Deferred Tax Assets and Liabilities.
Dividends Paid and Proposed
20182017
$000$000
Recognised Amounts
Declared and Paid During the Year to Parent Shareholders
Final Fully Imputed Dividend for 2017: 24.0 cents (2016: 23.0 cents)24,168 23,160
Interim Fully Imputed Dividend for 2018: 19.0 cents (2017: 17.0 cents)19,133 17,119
43,301 40,279
Unrecognised Amounts
Final Fully Imputed Dividend for 2018: 26.0 cents (2017: 24.0 cents)26,182 24,168
After the balance date, the above unrecognised dividends were approved by directors' resolution dated 28 May 2018.
These amounts have not been recognised as a liability in 2018 but will be brought to account in 2019.

4Abnormal Items
During the year the Group had $7,224,000 of abnormal expenses (2017 $2,698,000). The related after tax expense was
$5,048,000 (2017 $1,891,000).
In the year the Group had no abnormal gains (2017 $250,000). The related after tax gain was $722,000 (2017 $250,000).
These items comprised of:
2018 Year
Pre-TaxTaxAfter Tax
$000$000$000
Brand Name Impairment***(3,763) 941 (2,822)
Redundancies(3,461) 1,235 (2,226)
Tax Rate Changes - 722 722
(7,224) 2,898 (4,326)
2017 Year
Pre-TaxTaxAfter Tax
$000
$000$000
Redundancies(2,698) 807 (1,891)
Earnout Accrual Written Back250 - 250
(2,448) 807 (1,641)
***With the process of rebranding our European operations to Mainfreight underway it was decided to impair the
purchased brand of Wim Bosman by one third in the 2018 financial year. This impairment entry has no cash impact.
5
Annual Report and Annual Meeting
The annual report is expected to be available on 26 June 2018.
The Annual Meeting is to be held at the Barrel Hall, Villa Maria Estate, 118 Montgomerie Road, Mangere,
Auckland at 4.00pm on Thursday 26 July 2018.

6Segmental Reporting
An operating segment is a component of an entity that engages in business activities from which it may earn revenues and incur expenses whose
operating results are regularly reviewed by the entity’s chief operating decision maker and for which discrete financial information is available.
The Group operates in the domestic supply chain (i.e. moving and storing freight within countries) and air and ocean freight industries
(i.e. moving freight between countries).
New Zealand, Australia, The Americas and Europe are each reported to management as one segment as the businesses there perform both
domestic and air and ocean services.
The accounting policies of the operating segments are the same as those described in the notes in note 2 with the exception of
deferred tax and the fair value of derivative financial instruments which are not reported on a monthly basis.
The segmental results from operations are disclosed below.
Geographical Segments
The following table represents revenue, margin and certain asset information regarding geographical segments for the years ended
31 March 2018 and 31 March 2017.
NewAustraliaTheAsiaEuropeInter-2018
Zealand
AmericasSegment $000
Operating Revenue
-Sales to customers 666,156 675,217 610,913 117,304 549,270 - 2,618,860
outside the group
-Inter-segment sales294 18,631 40,811 64,084 30,228 (154,048) -
Total Revenue666,450 693,848 651,724 181,388 579,498 (154,048) 2,618,860
EBITDA98,633 54,040 26,906 6,861 28,976 - 215,416
Depreciation & Amortisation21,174 7,173 5,786 644 13,011 - 47,788
Capital Expenditure33,463 7,860 6,495 240 21,173 - 69,231
Trade Receivables85,475 92,321 94,181 15,212 93,488 (18,940) 361,737
Non-current Assets372,010 174,896 83,823 11,094 223,388 - 865,211
Total Assets473,466 299,228 200,561 50,897 371,190 (18,940) 1,376,402
Total Liabilities201,965145,993114,01621,996198,969(18,940)663,999

NewAustraliaThe
AsiaEuropeInter-2017
Zealand
AmericasSegment$000
Operating Revenue
-Sales to customers 609,238 568,056 615,280 89,328 451,689 - 2,333,591
outside the group
-Inter-segment sales999 17,379 13,785 73,809 20,182 (126,154) -
Total Revenue610,237 585,435 629,065 163,137 471,871 (126,154) 2,333,591
EBITDA91,021 44,930 26,205 8,806 26,580 - 197,542
Depreciation & Amortisation18,943 6,843 5,341 639 11,726 - 43,492
Capital Expenditure38,627 6,222 6,875 577 14,998 - 67,299
Trade Receivables85,043 80,743 78,418 14,016 73,746 (17,078) 314,888
Non-current Assets363,308 178,398 86,536 18,261 198,225 - 844,728
Total Assets455,008 289,716 186,934 51,637 318,548 (17,078) 1,284,765
Total Liabilities208,496143,285104,20823,853176,399(17,078)639,163

Reconciliation between Segment EBITDA and the Income Statemen
t20182017
$000$000
Profit from Operations Before Abnormal Items and Taxation for the Yea
r160,572 146,770
Interest Income(511) (504)
Derivative Fair Value Movemen
t- -
Non-cash Share Based Payment Expense- 55
Finance Costs7,567 7,729
Depreciation & Amortisation47,788 43,492
EBITDA215,416 197,542
EBITDA is defined as earnings before net interest expense, tax, depreciation, amortisation, abnormal items, royalties, share based payment
expense, minority interests and associates.
There are no customers in any segment that comprise more than 10% of that segment's revenue.
Bank term loan is allocated based on segment net assets excluding bank term loan.
The geographical segments are determined based on the location of the Group's assets.

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$
13 July, 201820 July, 2018
$26,181,622
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$$0.018056$0.101111
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(09) 259 5500(09) 270 74022852018
Ordinary SharesNZMFTE0001S9
EMAIL: announce@nzx.com
Notice of event affecting securities
Mainfreight Limited
Tim WilliamsDirectors Resolution

---

MAINFREIGHT LIMITED

Mainfreight Lane | off Saleyards Road | Otahuhu 1062 | New Zealand
Tel +64 9 259 5500 | Fax +64 9 270 7400
PO Box 14-038 | Panmure | Auckland 1741 | New Zealand


Supporters of
MAINFREIGHT – GLOBAL LOGISTICS
MAINFREIGHT LIMITED

Financial result for the twelve months ended 31 March 2018 (Unaudited)

Commentary
Mainfreight is pleased to announce our full year financial results to 31 March 2018.
These results are once again at levels never before achieved by the business; another
record year if you like.

Sales revenue for the year improved 12.2% to $2.62 billion (excluding foreign
exchange effects the increase is 10.6%), an increase of $285.27 million. Our EBITDA
improved 9.0% to $215.42 million (excluding foreign exchange effects the increase is
7.9%), and net profit before abnormals is $112.22 million.

Abnormal items after tax totalled $4.33 million, incorporating redundancies for people
in Asia, Europe and the United States, and a part write-down of the Wim Bosman
brand in our Europe business, amounting to one-third of that brand’s value.

In all five regions where we operate, sales revenues were increased and only in Asia
did EBITDA not meet our expectations. A satisfactory performance, and a strong
indication of our continuing success in growing a global logistics business.

Importantly this growth provides us with the confidence to keep investing in our
network and our expansion to more countries. Thirty-eight land and building projects,
leased and owned, have been committed to, across all our geographic regions
bringing improved facilities and intensification of our network as we dedicate resources
to accommodate increasing demand from our customers.

We continue to be confident that this level of growth and profitability will continue.

- 2 -

Divisional Performance (figures in local currencies)

New Zealand (NZ$)
Our New Zealand operations continue to surprise us with their exceptional energy,
enthusiasm and commitment to find growth and increased profitability.

New Zealand sales revenues improved by 9.3% to $666.16 million. EBITDA
performance improved 8.4% to a record $98.63 million. This despite the ongoing
effects of the Kaikoura earthquakes of November 2016, where inter-Island freight links
to and from the South Island were restricted to limited rail services and demanded
more road and coastal shipping options.

Our Logistics business increased its warehouse footprint to 145,000m
2
providing
capacity for 150,000 pallets. Additional sites in Auckland, Tauranga and Hamilton
have been identified to cater for further growth.

Our Transport division is under the greatest pressure. Congestion, with increased
freight tonnage at our sites in Auckland, Tauranga, Rotorua, Palmerston North,
Wellington, Nelson and Dunedin is proving those facilities inadequate to cope.
Additional growth from existing customers and volumes from new customers has
required land to be sourced in all these areas to enable the construction of new
facilities to offset the congestion issues. In addition, we expect to intensify our
New Zealand branch network with further regional development.

Our Air & Ocean division has recorded increased airfreight and seafreight tonnage
across both imports and exports, including perishable airfreight exports. Capacity
through our new Christchurch operation and improvements being made to our
Auckland facilities will see further capability and commitment for the expected growth.
Regional development alongside our Domestic freight operations extends our
Air & Ocean capability for exporters and importers throughout New Zealand.

- 3 -

Australia (AU$)
This is the best ever financial result for our Australian operations, with all three
divisions recording improved sales growth. It is the best performance improvement of
any country in our global network.

Sales revenues increased by 16.6%, up $88.77 million to $623.77 million. EBITDA
improved 18.0% to $49.92 million.

Our commitment to quality, the investment in substantial facilities throughout the
region, and our motivated team of people have generated these very satisfactory
returns.

It is our expectation that these current levels of growth are sustainable, therefore our
capital investment in new land and buildings across Queensland, New South Wales,
Victoria, South Australia and Western Australia will continue in an effort to provide
appropriately-sized facilities to cope with the logistics and distribution tasks that our
customers are asking of us.

New Transport branches in place for Bendigo and Toowoomba (with Wollongong to
follow), will expand our reach into regional Australia, with total branch locations
throughout Australia now numbering 53. Tasmania and Far North Queensland, as
branch locations, remain of high interest.

New Logistics facilities in Melbourne, Sydney and Perth will add a further 52,000m
2

to our warehousing footprint, increasing pallet capacity to 187,100 pallets. In addition,
dedicated hazardous goods facilities are amongst the new sites, complementing the
growth of our Chemcouriers (specialist hazardous goods transport) brand around
Australia.

In our Air & Ocean division, sales growth has been satisfactory, yet below our
requirements. Higher levels of growth are expected as we leverage the benefits of our
international network, particularly from Europe. As with the balance of our network
there is a focus on developing our LCL air and seafreight consolidations, assisting our
smaller to medium-sized customers with their import and export requirements.

- 4 -

Asia (US$)
While our improving sales focus in this region saw revenues improve 32.4% to $83.86
million, our EBITDA performance disappointed, declining 21.5% to $4.91 million.

Much of the sales revenue increase came from external trading; when inter-company
revenue is included, overall sales improved 12.1%.

Senior management changes mid-year and a back-to-basics approach to our business
in the region has seen this decline reduced during the final quarter, and importantly we
are seeing an improvement as we head into the new financial year.

This back-to-basics approach will focus on the development of our Air & Ocean
product throughout Asia for the short to medium-term, allowing capability to develop
before entering third-party logistics, warehousing and domestic transportation.

Asia is a key component in our global trade-lane network, with all our regions having
substantial freight volumes into and out of the region. Southeast Asia and Japan,
where our current footprint is minimal, are high on our agenda for future expansion.


Europe (Euro €)
Improvement from our Logistics and Air & Ocean divisions has seen sales revenues
improve, up 15.9%% to €335.77 million, with EBITDA level marginally improving to
€17.71 million, up 3.1%.

In light of previous years’ performance in Europe, this is good progress and provides
confidence as we develop and expand our presence in the region.

Investment has been made in the past 12 months, and will continue for the next 12
months, to improve Logistics warehousing capacity from 329,000 pallets to 387,200
pallets, and two additional cross-docks to provide the infrastructure to meet the
demands of new customer contracts and to support a greater level of efficiency in our
Forwarding division.

- 5 -

It is likely that EBITDA growth will be subdued in the next 12 months, particularly in
Logistics, while additional warehousing costs are absorbed and utilisation is improved
as customer contracts are realised.

In our Air & Ocean division, we have taken advantage of our global network,
benefiting from increased trade with our American interests. Asian freight volumes
have been slower to develop, however the management and strategy changes made
in Asia will see a renewed focus across these trades.

Rebranding of our European interests is well underway and is expected to be
completed by 2019.


The Americas (US$)
The Americas region continues to offer some of our biggest opportunities, and to date
we have yet to realise all that is available to us.

Nevertheless, EBITDA performance has improved 3.5% to $19.24 million, while
revenue levels were consistent with the year prior at $436.74 million. This
performance includes a better than expected turnaround in revenue levels from
CaroTrans (our wholesale seafreight business) and an improving Domestic
Transport contribution.

Our Logistics operations have extended their warehouse footprint from 49,000m
2
to
59,000m
2
to accommodate a growing portfolio of new customers.

The Transport operation is developing its expedited LCL freight network across 22
branches, but particularly concentrating on its dedicated road and rail line-haul and
PUD (pick-up & delivery) services to the largest six branches of the network, all the
largest cities of their respective states.

Our Air & Ocean business has extended its presence across the region and has
improved normal trading revenues when excluding large one-off airfreight projects that
were a feature of the prior year.

- 6 -

CaroTrans has progressed well through its transition to new leadership, and has a
well-defined strategy to improve quality, be more customer focused, and lift sales
performance. Profitability is not back at the peak levels of 2014, but our expectations
are high that we have a restructured business, better focused and capable of
achieving our expectations.

We remain confident of the momentum we have in the USA, albeit requiring a great
deal of patience while we establish a stronger foothold across all four divisions.

Group Operating Cash Flows
Operating cash flows were $140.24 million, up from $131.23 million last year,
reflecting increased profitability.

Net debt is $196.85 million, down from $212.94 million, a reduction of $16.09 million.
Gearing ratios improved from 24.8% to 21.70%.

During the year net capital expenditure totalled $64.68 million, with expenditure for
land and buildings accounting for $20.19 million, plant and equipment of
$26.81 million, and information technology of $17.68 million.

It is our expectation that capital expenditure required for the 2019 financial year for
property development will likely be in the vicinity of $105 million, as indicated in early
commentary. Non-property related expenditure, including software development, will
be approximately $45 million.

Dividend
The Directors have approved a final dividend of 26.0 cents per share fully imputed at
the 28% company tax rate, with the books closing on 13 July 2018; payment will be
made on 20 July 2018. This takes the full dividend for the year to 45.0 cents per
share; a 9.8% increase year on year.

- 7 -

Outlook
This result, yet another record, is a highlight in our journey to create a global logistics
business. A fitting tribute as we celebrate our 40
th
year in business.

The decisions we have taken through the year to invest considerably in the
intensification of our network, and to develop facilities and infrastructure to cope with
ongoing growth aspirations, are significant and a reflection of the confidence we have
in our people and strategies.

These investments will ensure our people have the resources to provide the high
quality logistics services our customers require.

In recognition of the commitment and performance of our people, this result allows us
to pay our largest ever discretionary bonus to our team, up 7.4% to $20.70 million. In
New Zealand and Australia, we have always paid above the minimum and living wage
levels, however we have chosen to further lift salaries for those at the lower end of our
pay range, with an additional boost over and above our usual annual salary increase
this year.

Such investments in infrastructure and remuneration do not come without risk, and
associated increases in overhead costs. We have full confidence in the ability of our
team of people across the world to counter those increases by improving sales, finding
efficiencies and by delighting our customers

We expect to continue to extend our global footprint, and where openings arise we will
take the opportunity to establish ourselves in more countries.

We are confident of our development and growth for the future – the next 100 years.

Mainfreight will release its financial results for the first half of the 2019 financial year to
the market on 14 November 2018.


For further information, please contact Don Braid, Group Managing Director,
Telephone +64 9 259 5503, +64 274 961 637, or email don@mainfreight.com.