Mainfreight Results for Six Months Ended September 2018

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 six months ended 30 September 2018 (Unaudited)

Commentary
Mainfreight is pleased to report our six monthly financial results to 30 September 2018,
with comparisons to the same period last year.

Revenue $1.43 billion Up $205.41 million or 16.8%
EBITDA $108.34 million Up $19.58 million or 22.1%
Net profit (before abnormals) $55.90 million Up $13.12 million or 30.7%

Adjusted for foreign exchange impact, revenue is up 13.2%, and EBITDA up 19.3%.

This satisfactory performance is attributable to ongoing growth and profitability across
all five regions in our global network. Our offshore divisions are now contributing 58.1%
of EBITDA, totalling $62.92 million. Sales generated offshore in this first half year
totalled $1.09 billion, 76.0% of our total revenue.

Within this result, our Air & Ocean division contributed significantly to both revenue and
EBITDA performance, and our expectation is that this division of the business will
contribute more over time.

Trading through October and into November has seen the trend of improved financial
performance continue.

- 2 -

Divisional Performance (figures in local currencies)

New Zealand (NZ$)
Revenue $343.12 million Up $26.25 million or 8.3%
EBITDA $45.43 million Up $6.98 million or 18.2%

Strong regional freight growth and reliable rail services, compared to the long periods
without South Island rail in the prior year, has assisted our Domestic operations to
deliver sales growth and increase EBITDA performance. Our Air & Ocean operation has
also improved their trading results compared to the same period last year, with Logistics
(warehousing) remaining level with the prior year.

Domestic freight volumes were at record levels for this six-month period, with existing
customer and new business increases, particularly from regional New Zealand, where
we continue to invest in infrastructure to strengthen our services to those communities.

Our Air & Ocean division has seen a lift in revenue and EBITDA as our global network
trategy bears fruit.

The Logistics operations are also performing well at the revenue level, and with
increased levels of warehouse utilisation, will require additional commitment to new
facilities, impacting EBITDA returns in the short-term but positioning for further growth.

Pre-Christmas freight volumes across all three divisions are at record levels.


Australia (AU$)
Revenue AU$341.70 million Up AU$48.79 million or 16.7%
EBITDA AU$22.52 million Up AU$1.69 million or 8.1%

The continuing increase in sales revenues across all three divisions has assisted an
improved financial performance, albeit with slower growth at the EBITDA level as higher
growth-related overhead costs impacted our Transport division through the first quarter.

- 3 -

Improving quality in our Transport division is attracting new customers and assisting in
the retention of our current loyal customer base. Freight volumes continue to grow
heading into the pre-Christmas period. The use of rail is assisting to ease pressure on
road transport.

Our Logistics warehousing activity continues to find growth, necessitating further
short-term warehouse leases as volume increases. The new purpose-built facility in
Sydney is expected to assist early in the New Year.

Air & Ocean, like the other divisions, has achieved improved revenue and EBITDA
results for the first half year as international freight volumes assist performance.


Asia (US$)
Revenue US$40.33 million Up US$2.72 million or 7.2%
EBITDA US$3.17 million Up US$1.15 million or 56.6%

Renewed energy and a clear international Air & Ocean freight strategy within our Asian
operations has seen financial performance improve markedly compared to the same
period last year.

Network development across Southeast Asia has also gained momentum with our first
Malaysian operation opening post-result, on 15 October 2018. We also expect to have
our first Japanese operation open early in 2019, with licensing and business
documentation requirements completed and accepted by Japanese authorities.


The Americas (US$)
Revenue US$237.15 million Up US$34.10 million or 16.8%
EBITDA US$10.99 million Up US$2.55 million or 30.2%

A pleasing result from our North American operations, with performance improvement
largely driven by our Domestic Transport operations, where new customer gains have
lifted revenue and EBITDA.

- 4 -

Our Logistics division has also secured new business, improving warehouse utilisation
across all five locations. Further gains are expected as the year progresses, likely
necessitating new facilities.

Our Air & Ocean operations saw revenues increase but we were unable to convert this
to positive returns as gross margins declined. Improvements in margin are evident
during October and November, providing confidence for an improved EBITDA result
from Air & Ocean at year end.

Trading within the CaroTrans wholesale business has been steadily improving during
the year, with an increase in revenue and EBITDA.

All our USA divisions have seen trading conditions in October and November remain
positive, and it is our expectation for this current level of improvement to continue.


Europe (Euro €)
Revenue EU€182.33 million Up EU€19.82 million or 12.2%
EBITDA EU€10.40 million Up EU€2.00 million or 23.8%

We continue to find further financial and operational improvement in our European
business, with sales growth across all divisions.

Our Domestic forwarding operations contributed significantly to this improvement,
providing improved EBITDA results through better line-haul and pick-up-and-delivery
management. Whilst our Belgian forwarding operations are yet to be profitable, the
infrastructure investment in two new cross-docks is assisting.

Our Logistics operation grew sales revenue, but saw EBITDA at similar levels to the
prior period, as new warehouse leases and new customer implementations increased
overhead costs.

Similarly to our global Air & Ocean development, our European Air & Ocean division
achieved improved revenues and EBITDA contributions.

- 5 -

Trading through October and November sees current trends continue and expectations
are for a satisfactory year end result.


Group Operating Cash Flows
Operating cash flows were NZ$71.00 million compared to the prior year’s half year
figure of NZ$57.15 million.

During the half year, net capital expenditure totalled $40.19 million of which $21.14
million related to property development.


Dividend
The Directors of Mainfreight have approved an interim dividend of 22.0 cents per share,
up 3.0 cents on last year’s interim dividend level, reflecting current profit levels and
ongoing confidence for further improvement at the year end result.

This dividend will be fully imputed and will be paid on 14 December 2018, with books
closing on 7 December 2018. A supplementary dividend will be paid to non-resident
shareholders.


Outlook
This first half result is satisfactory, compared with a somewhat muted result in the prior
year, and provides us with a good platform for further improvement over the longer
term.

To have all regions contributing improved financial and operational results is pleasing.
Therefore it is our expectation that financial performance will continue to be better for
the full year, delivering another improved full year profit.

Our land and building projects are generally progressing well. Capital expenditure for
land and buildings for the full year is likely to be in line with our projections.

- 6 -

Importantly, these new and refurbished land and building projects will bring improved
facilities complementing the development of our network and providing our people with
the resources to develop further growth over the long term.

Mainfreight will release its financial results for the full 2019 financial year to the market
on 28 May 2019.



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

---

PRELIMINARY HALF YEAR REPORT ANNOUNCEMENT
Mainfreight Limited
For Half Year Ended 30 September 2018
Preliminary half year report on consolidated results (including the results for the previous corresponding half year).
This report has been prepared in a manner which complies with the New Zealand equivalent to International Accounting Standard 34
Interim Financial Reporting and fairly presents the matters to which the report relates and is based on unaudited financial statements.
The Listed Issuer has a formally constituted Audit Committee of the Board of Directors.
Income Statement for the Six Months Ended 30 September 2018
Note30 Sept30 Sept 31 March
201820172018
$000$000$000
Operating Revenue1,430,994 1,225,583 2,616,189
Interest Income- - 511
Total Revenue1,430,994 1,225,583 2,616,700
Transport Costs(875,751) (748,541) (1,605,459)
Labour Expenses Excluding Share Based Payments(305,700) (266,441) (538,483)
Occupancy Expenses and Rental Recharge(40,247) (35,727) (73,192)
Depreciation and Amortisation Expenses(26,080) (23,115) (47,788)
Other Expenses(100,954) (86,108) (183,941)
Finance Costs(3,966) (3,927) (7,567)
Profit Before Abnormal Items and Taxation for the Year78,296 61,724 160,270
Income Tax on Profit Before Abnormal Items(22,400) (18,952) (48,266)
Net Profit Before Abnormal Items for the Year55,896 42,772 112,004
Abnormal Items4(291) (906) (7,224)
Income Tax on Abnormal Items498 351 2,898
Abnormal Items After Taxation4(193) (555) (4,326)
Profit Before Taxation for the Year78,005 60,818 153,046
Income Tax Expense(22,302) (18,601) (45,368)
Net Profit for the Year55,703 42,217 107,678
Earnings per share for profit attributable to the ordinary equity holders of the company are:
CentsCentsCents
Basic Earnings Per Share: Total Operations55.3241.92106.93
Diluted Earnings Per Share: Total Operations55.3241.92106.93
Statement of Comprehensive Income for the Six Months Ended 30 September 2018
Net Profit for the Year55,703 42,217 107,678
Other Comprehensive Incom
e
Other comprehensive income to be reclassified to profit or loss in subsequent periods:
Exchange Differences on Translation of Foreign Operations13,780 (1,198) (1,978)
Income Tax effect941 - 3,371
Net Other comprehensive income to be reclassified to profit (loss) in subsequent periods14,721 (1,198) 1,393
Other comprehensive income not to be reclassified to profit or loss in subsequent periods:
Revaluation of Land including Foreign Exchange Movements325 356 638
Income Tax effect- - -
Net Other comprehensive income not to be reclassified to profit (loss) in subsequent periods325 356 638
Other comprehensive income not to be reclassified to profit or loss in subsequent periods:
Defined Benefit Pension Provision(7) (29) 325
Income Tax effect- - (137)
Net Other comprehensive income not to be reclassified to profit (loss) in subsequent periods(7) (29) 188
Other Comprehensive Income for the Year, Net of Ta
x15,039 (871) 2,219
Total Comprehensive Income for the Year, Net of Ta
x70,742 41,346 109,897

Balance Sheet as at 30 September 2018
30 Sept30 Sept 31 March
201820172018
$000$000$000
Current Assets
Bank85,318 67,487 80,521
Trade Debtors432,321 330,872 361,737
Income Tax Receivable- 644 270
Properties Available for Sale8,473 - 7,852
Other Debtors53,446 51,170 60,811
579,558 450,173 511,191
Non-current Assets
Property, Plant & Equipment605,584 586,300 582,310
Software49,956 45,326 49,374
Goodwill216,681 204,093 207,919
Brand Names8,096 11,262 7,863
Other Intangible Assets8,237 10,065 9,164
Deferred Tax Asset9,189 9,149 8,882
897,743 866,195 865,512
TOTAL ASSETS1,477,301$ 1,316,368$ 1,376,703$
Current Liabilities
Bank- - 36
Trade Creditors & Accruals355,666 284,152 298,916
Employee Entitlements56,093 50,698 53,373
Provision for Taxation2,234 7,569 12,323
Finance Lease Liability1,956 1,838 2,077
415,949 344,257 366,725
Non-current Liabilities
Bank Term Loan277,595
284,892 270,753
Employee Entitlements3,856 745 3,634
Deferred Tax Liability21,835 23,769 21,526
Finance Lease Liability3,948 2,565 4,507
307,234 311,971 300,420
Shareholders' Equity
Share Capital385,821 85,821 85,821
Accumulated Surplus612,880 537,031 583,359
Revaluation Reserve51,579 50,972 51,254
Foreign Currency Translation Reserve4,077 (13,235) (10,644)
Defined Benefit Pension Reserve(239) (449) (232)
TOTAL EQUITY754,118 660,140 709,558
TOTAL LIABILITIES AND EQUITY1,477,301$ 1,316,368$ 1,376,703$
The accompanying notes form an integral part of these financial statements.

Statement of Changes in Equity for the Six Months Ended 30 September 2018
Six Months to 30 September 2018ForeignDefined
AssetCurrencyBenefit
OrdinaryRevaluationTranslationPensionRetainedTOTAL
SharesReserveReserveReserveEarnings$000
Balance at 1 April 201885,821 51,254 (10,644) (232) 583,359 709,558
Profit for the Period55,703 55,703
Other Comprehensive Income325 14,721 (7) 15,039
-
Total Comprehensive Income for the
P- 325 14,721 (7) 55,703 70,742
Transactions with Owners in Their Capacity as Owners:
Shares Issued-
Executive Share Scheme Costs -
Supplementary Dividends(989) (989)
Dividends Paid(26,182) (26,182)
Foreign Investor Tax Credit989 989
Balance at 30 September 201885,821 51,579 4,077 (239) 612,880 754,118
Six Months to 30 September 2017ForeignDefined
AssetCurrencyBenefit
OrdinaryRevaluationTranslationPensionRetainedTOTAL
SharesReserveReserveReserveEarnings$000
Balance at 1 April 201785,821 50,616 (12,037) (420) 518,982 642,962
Profit for the Period42,217 42,217
Other Comprehensive Income356 (1,198) (29) (871)
-
Total Comprehensive Income for the
P- 356 (1,198) (29) 42,217 41,346
Transactions with Owners in Their Capacity as Owners:
Shares Issued-
Executive Share Scheme Costs -
Supplementary Dividends(824) (824)
Dividends Paid(24,168) (24,168)
Foreign Investor Tax Credit824 824
Balance at 30 September 201785,821 50,972 (13,235) (449) 537,031 660,140
Twelve Months to 31 March 2018ForeignDefined
AssetCurrencyBenefit
OrdinaryRevaluationTranslationPensionRetainedTOTAL
SharesReserveReserveReserveEarnings$000
Balance at 1 April 201785,821 50,616 (12,037) (420) 518,982 642,962
Profit for the Period107,678 107,678
Other Comprehensive Income638 1,393 188 2,219
-
Total Comprehensive Income for the
P- 638 1,393 188 107,678 109,897
Transactions with Owners in Their Capacity as Owners:
Shares Issued-
Executive Share Scheme Costs -
Supplementary Dividends(1,497) (1,497)
Dividends Paid(43,301) (43,301)
Foreign Investor Tax Credit1,497 1,497
Balance at 31 March 201885,821 51,254 (10,644) (232) 583,359 709,558

Cash Flow Statement for the Six Months Ended 30 September 2018
Group
Note30 Sept30 Sept 31 March
201820172018
$000$000$000
Cash Flows From Operating Activities
Receipts from Customers1,603,121 1,389,656 2,580,429
Interest Received- 511
Payments to Suppliers and Team Members(1,495,938) (1,304,324) (2,388,030)
Interest Paid(3,965) (3,927) (7,567)
Income Taxes Paid(32,212) (24,257) (45,107)
NET CASH FLOWS FROM OPERATING ACTIVITIES71,006 57,148 140,236
Cash Flows From Investing Activities
Proceeds from Sale of Property, Plant & Equipment2,391 1,198 4,507
Proceeds from Sale of Software- - 46
Repayments by Team Members7 213 213
Purchase of Property, Plant & Equipment(33,129) (22,944) (51,509)
Purchase of Software(9,456) (10,592) (17,726)
Advances to Team Members- (6) (10)
Establishment of Franchises and Subsidiaries- - (250)
NET CASH FLOWS FROM INVESTING ACTIVITIES(40,187) (32,131) (64,729)
Cash Flows From Financing Activities
Proceeds of Long Term Loans- 1,974
Proceeds of Share Issues- -
Dividend Paid to Shareholders(26,182) (24,168) (43,300)
Repayment of Loans(3,736) (7,730) (28,441)
NET CASH FLOWS FROM FINANCING ACTIVITIES(29,918) (31,898) (69,767)
NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS901 (6,881) 5,740
Net Foreign Exchange Differences3,932 3 380
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD80,485 74,365 74,365
CASH AND CASH EQUIVALENTS AT END OF PERIOD85,318 67,487 80,485
Comprised
Bank and Short Term Deposits85,318 67,487 80,521

Bank Overdraft- - (36)
85,318 67,487 80,485
The accompanying notes form an integral part of these financial statements.

1Corporate Information
The preliminary half year report announcement of Mainfreight Limited ("the parent") and its subsidiaries ("the Group")
for the six months ended 30 September 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 prior year ended 31 March 2018 financial statements except for
the adoption of NZ IFRS 15 Revenue from Contracts with Customers.
(Please see Note 2 (e) of the Financial Statements in the March 2018 Annual Report for further information).
A restatement of the 2018 Financial Statements was required as a result of this and the impact was:
Opening (1 April 2017) net assets and equity of the Group was reduced by $2,640,000.
Profit before tax was reduced by $302,000 and after tax by $215,000 in the 31 March 2018 year.
Revenue in the year to 31 March 2018 was reduced by $2,160,000.
3Required NZX Disclosures
Movements in Ordinary Shares on IssueParent
30 Sept30 Sept31 March
201820172018
SharesSharesShares
Closing Balance100,698,548 100,698,548 100,698,548
Net Tangible Assets521,104 434,720 484,612
Net Tangible Assets per Security (cps)517.49431.70481.25
Dividends Paid and Propose
d
Group
30 Sept30 Sept
20182017
$000$000
Recognised Amount
s
Declared and Paid During the Year to Parent Shareholders
Final Fully Imputed Dividend for 2018: 26.0 cents (2017: 24.0 cents)26,182 24,168
26,182 24,168
Unrecognised Amount
s
Interim Fully Imputed Dividend for 2019: 22.0 cents (2018: 19.0 cents)22,154 19,133
After the balance date, the above unrecognised dividends were approved by directors' resolution dated 13 November 2018.
These amounts have not been recognised as a liability as at 30 September 2018 but will be brought to account in the full
year to 31 March 2019.

4Abnormal Items
During the six months the Group had $291,000 of abnormal expenses (September 2017 $906,000). The related after tax
expense was $193,000 (September 2017 $555,000).
These items comprised of:
Group
September 2018 Six MonthsPre-TaxTaxAfter Tax
$000$000$000
Redundancies(291,000) 98,000 (193,000)
(291,000) 98,000 (193,000)
Group
September 2017 Six MonthsPre-TaxTaxAfter Tax
$000$000$000
Redundancies(906,000) 351,000 (555,000)
(906,000) 351,000 (555,000)

5Segmental Reporting
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 six months ended
30 September 2018 and 30 September 2017. Inter segment transactions are entered into on a fully commercial basis.
2018
NewAustraliaTheAsiaEuropeInter-$000
ZealandAmericasSegmentGroup
Operating Revenue
- sales to customers 343,120 370,530 345,655 58,786 312,903 - 1,430,994
outside the group
- inter-segment sales(577) 9,324 25,401 38,200 18,486 (90,834) -
Total Revenue342,543 379,854 371,056 96,986 331,389 (90,834) 1,430,994
EBITDA45,426 24,418 16,018 4,623 17,857 - 108,342
Depreciation & Amortisation11,211 3,852 3,226 313 7,478 - 26,080
Capital Expenditure12,772 12,044 3,462 652 11,264 - 40,194
Trade Receivables92,744 114,383 114,603 29,111 100,420 (18,940) 432,321

Non-current Assets373,519 187,845 91,219 11,573 233,587 - 897,743
Total Assets471,840 333,419 234,783 66,839 389,360 (18,940) 1,477,301
Total Liabilities203,523 165,444 133,408 34,282 205,466 (18,940) 723,183

2017
NewAustraliaTheAsiaEuropeInter-$000
ZealandAmericasSegmentGroup
Operating Revenue
- sales to customers 316,867 314,319 284,037 52,611 257,749 - 1,225,583
outside the group
- inter-segment sales109 9,187 19,435 26,720 13,076 (68,527) -
Total Revenue316,976 323,506 303,472 79,331 270,825 (68,527) 1,225,583
EBITDA38,446 22,351 11,809 2,833 13,327 - 88,766
Depreciation & Amortisation10,223 3,542 2,814 323 6,213 - 23,115
Capital Expenditure15,710 3,021 2,506 165 10,936 - 32,338
Trade Receivables79,202 94,466 77,863 20,316 76,103 (17,078) 330,872

Non-current Assets370,796 177,061 83,630 17,850 216,858 - 866,195
Total Assets438,047 305,730 188,813 55,733 345,123 (17,078) 1,316,368
Total Liabilities197,149 155,300 105,133 27,791 187,933 (17,078) 656,228

Reconciliation between Se
gment EBITDA and the Income Statement20182017
$000$000
Profit from Operations Before Abnormal Items and Taxation for the Year78,296 61,724
Interest Income- -
Derivative Fair Value Movement- -
Non-cash Share Based Pa
yment Expense- -
Finance Costs3,966 3,927
Depreciation & Amortisation26,080 23,115
EBITD
A108,342 88,766
EBITDA is defined as earnin
gs 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.
The gegraphical segments are determined based on the location of the Group's assets.

APPENDIX 7 – NZSX Listing Rules
Number of pages including this one
(Please provide any other relevant
NZSX Listing Rule 7.12.2. For rights, NZSX Listing Rules 7.10.9 and 7.10.10.details on additional pages)
For change to allotment, NZSX Listing Rule 7.12.1, a separate advice is required.
Full name
of Issuer
Name of officer authorised to
Authority for event,
make this notice
e.g. Directors' resolution
Contact phone
Contact fax
numbernumberDate
Nature of event
BonusIf ticked,Rights Issue
Tick as appropriateIssuestate whether:Taxable/ Non TaxableConversionInterestRenouncable
Rights IssueCapitalCallDividend
If ticked, stateFull
non-renouncable
change
X
whether:
Interim
X
YearSpecialDRP Applies
EXISTING securities affected by this
If more than one security is affected by the event, use a separate form.
Description of theISI
N
class of securities
If unknown, contact NZX
Details of securities issued pursuant to this eventIf more than one class of security is to be issued, use a separate form for each class.
Description of theISI
N
class of securities
If unknown, contact NZX
Number of Securities toMinimum
Ratio, e.g
be issued following eventEntitlement
1 for 2 for
Conversion, Maturity, Call
Treatment of Fractions
Payable or Exercise Date
Tick i
f
provide an
pari passu
ORexplanation
Strike price per security for any issue in lieu or date
of the
Strike Price available.
ranking
Monies Associated with Event
Dividend payable, Call payable, Exercise price, Conversion price, Redemption price, Application money.
Source of
Amount per security
Payment
(does not include any excluded incom
e
Excluded income per security
(only applicable to listed PIEs)
Supplementary
Amount per security
Currencydividendin dollars and cents
details -
NZSX Listing Rule 7.12.7
Total monies
TaxationAmount per Security in Dollars and cents to six decimal places
In the case of a taxable bonusResident
Imputation Credit
s
issue state strike priceWithholding Tax(Give details)
Foreign
FWP Credits
Withholding Tax(Give details)
Timing
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Record Date 5pm
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For calculation of entitlements -Also, Call Payable, Dividend /
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of applications this must be the
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Notice Date
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Entitlement letters, call notices,For the issue of new securities.
conversion notices mailedMust be within 5 business days
of application closing date.
OFFICE USE ONLY
Ex Date:
Commence Quoting Rights:Security Code:
Cease Quoting Rights 5pm:
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Security Code:
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EMAIL: announce@nzx.com
Notice of event affecting securities
Mainfreight Limited
Tim WilliamsDirectors Resolution
(09) 259 5500(09) 270 7402
13112018
Ordinary SharesNZMFTE0001S9
Enter N/A if not
applicable
In dollars and cents
Revenue
$0.220
NZ $$0.038824
$22,153,681
Date Payable
14 December, 2018
$
$0.015278$0.085556
$
7 December, 201814 December, 2018