Mainfreight Full Year Results to 31 March 2020

PRELIMINARY FULL YEAR REPORT ANNOUNCEMENT
Mainfreight Limited
For Full Year Ended 31 March 2020
Preliminary full year report on consolidated results (including the results for the previous corresponding full year).
This report includes supplementary information in the Income Statement, Balance Sheet and Cash Flow Statement for the current period to show
what the results would have looked like prior to adopting the NZ IFRS 16 Lease changes (labelled Non-GAAP). Management and the Board believe
this is necessary to provide a better comparison with prior periods which have not been adjusted for the impact of NZ IFRS 16.
In other respects, 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 2020
GAAPNon-GAAPGAAP
Note202020202019
$000$000$000
Operating Revenue3,094,736 3,094,736 2,953,414
Interest Income658 658 673
Total Revenue3,095,394 3,095,394 2,954,087
Transport Costs(1,803,460) (1,803,460) (1,791,573)
Labour Expenses(670,103) (670,103) (612,641)
Other Expenses(222,502) (222,502) (191,021)
Earnings before Interest, Tax, Depreciation, Amortisation, Abnormal Items and Lease Costs399,329 399,329 358,852
Lease Costs- (117,665) (101,130)
Depreciation of Right of Use Assets(111,877) - -
Finance Costs Relating to Lease Liabilities(17,021) - -
Other Depreciation and Amortisation Expenses(57,852) (57,852) (53,107)
Other Finance Costs(6,326) (6,326) (7,541)
Profit Before Abnormal Items and Taxation for the Year206,253 217,486 197,074
Income Tax on Profit Before Abnormal Items(58,278) (61,382) (55,990)
Net Profit Before Abnormal Items for the Year147,975 156,104 141,084
Abnormal Items4(4,783) (4,783) (4,965)
Income Tax on Abnormal Items41,309 1,309 1,505
Abnormal Tax Item - Reversal of deferred tax liability on buildings414,700 14,700 -
Abnormal Items After Taxation11,226 11,226 (3,460)
Profit Before Taxation for the Year201,470 212,703 192,109
Income Tax Expense(42,269) (45,373) (54,485)
Net Profit for the Year159,201 167,330 137,624
Earnings per share for profit attributable to the ordinary equity holders of the company are:
CentsCentsCents
Basic and Diluted Earnings Per Share:Total Operations158.10166.17136.67

Statement of Comprehensive Income for the Year Ended 31 March 2020
GAAPNon-GAAPGAAP
Note202020202019
$000$000$000
Net Profit for the Year159,201 167,330 137,624
Other Comprehensive Income
Other comprehensive income to be reclassified to profit or loss in subsequent periods:
Exchange Differences on Translation of Foreign Operations23,850 24,132 1,144
Income Tax Effect3,323 3,323 (1,006)
Net Other comprehensive income to be reclassified to profit or loss in subsequent periods27,173 27,455 138
Other comprehensive income not to be reclassified to profit or loss in subsequent periods:
Revaluation of Land including Foreign Exchange Movements1,233 1,233 43,506
Income Tax Effect- - (4,106)
Net Other comprehensive income not to be reclassified to profit or loss in subsequent periods1,233 1,233 39,400
Other comprehensive income not to be reclassified to profit or loss in subsequent periods:
Defined Benefit Pension Provision(228) (228) (93)
Income Tax Effect57 57 23
Net Other comprehensive income not to be reclassified to profit or loss in subsequent periods(171) (171) (70)
Other Comprehensive Income for the Year, Net of Tax28,235 28,517 39,468
Total Comprehensive Income for the Year, Net of Tax187,436 195,847 177,092

Balance Sheet as at 31 March 2020
GAAPNon-GAAPGAAP
202020202019
$000$000$000
Current Assets
Bank116,140 116,140 115,184
Trade Debtors420,839 420,839 389,376
Income Tax Receivable2,937 2,937 200
Other Receivables73,129 73,129 55,304
613,045 613,045 560,064
Non-current Assets
Property652,639 652,639 547,641
Plant & Equipment123,936 123,936 118,988
Right of Use Assets615,250 - -
Software53,542 53,542 51,052
Goodwill226,566 226,566 208,522
Brand Names- - 3,807
Other Intangible Assets4,578 4,578 6,581
Deferred Tax Asset15,038 12,248 6,234
1,691,549 1,073,509 942,825
TOTAL ASSETS2,304,594 1,686,554 1,502,889
Current Liabilities
Bank6 6 4
Trade Creditors & Accruals339,562 339,562 314,925
Employee Entitlements69,565 69,565 62,832
Provision for Taxation19,207 19,207 18,868
Lease Liability for Right of Use Assets124,128 -
-
Finance Lease Liability2,732 2,732 2,246
555,200 431,072 398,875
Non-current Liabilities
Bank Term Loan267,698 267,698 238,653
Employee Entitlements2,887 2,887 2,815
Deferred Tax Liability6,654 7,065 19,473
Lease Liability for Right of Use Assets502,734 - -
Finance Lease Liability3,082 3,082 4,758
783,055 280,732 265,699
Shareholders' Equity
Share Capital85,821 85,821 85,821
Retained Earnings773,720 781,849 673,931
Revaluation Reserve90,604 90,604 89,371
Foreign Currency Translation Reserve16,667 16,949 (10,506)
Defined Benefit Pension Reserve(473) (473) (302)
TOTAL EQUITY966,339 974,750 838,315
TOTAL LIABILITIES AND EQUITY2,304,594 1,686,554 1,502,889
The accompanying notes form an integral part of these financial statements.

Statement of Changes in Equity for the Year Ended 31 March 2020
ForeignDefined
2020AssetCurrencyBenefit
$000OrdinaryRevaluationTranslationPensionRetained
SharesReserveReserveReserveEarningsTotal
Balance at 1 April 201985,821 89,371 (10,506) (302) 673,931 838,315
Profit for the Year- - - - 159,201 159,201
Other Comprehensive Income- 1,233 27,173 (171) - 28,235
Total Comprehensive Income for the Year- 1,233 27,173 (171) 159,201 187,436
Transactions with Owners in Their Capacity as Owners:
Supplementary Dividends- - - - (2,413) (2,413)
Dividends Paid- - - - (59,412) (59,412)
Foreign Investor Tax Credit- - - - 2,413 2,413
Balance at 31 March 202
085,821 90,604 16,667 (473) 773,720 966,339
ForeignDefined
2019AssetCurrencyBenefit
$000OrdinaryRevaluationTranslationPensionRetained
SharesReserveReserveReserveEarningsTotal
Balance at 1 April 201885,821 51,254 (10,644) (232) 583,359 709,558
Profit for the Year- - - - 137,624 137,624
Transfer of Revaluation Reserve for Land Sold- (1,283) - - 1,283
Other Comprehensive Income- 39,400 138 (70) - 39,468
Total Comprehensive Income for the Year- 38,117 138 (70) 138,907 177,092
Transactions with Owners in Their Capacity as Owners:
Supplementary Dividends- - - - (1,879) (1,879)
Dividends Paid- - - - (48,335) (48,335)
Foreign Investor Tax Credit- - - - 1,879 1,879
Balance at 31 March 201
985,821 89,371 (10,506) (302) 673,931 838,315

Cash Flow Statement for the Year Ended 31 March 2020
GAAPNon-GAAPGAAP
202020202019
$000$000$000
Cash Flows From Operating Activities
Receipts from Customers3,092,861 3,092,861 2,931,037
Interest Received658 658 673
Payments to Suppliers and Team Members(2,705,526) (2,823,191) (2,674,532)
Notional Finance Charge on NZ IFRS 16 Leases(17,021) - -
Interest Paid(6,326) (6,326) (7,541)
Income Taxes Paid(63,846) (63,846) (52,214)
NET CASH FLOWS FROM OPERATING ACTIVITIES300,800 200,156 197,423
Cash Flows From Investing Activities
Proceeds from Sale of Property, Plant & Equipment4,930 4,930 14,048
Proceeds from Sale of Software52 52 50
Repayments by Team Members- - 8
Purchase of Property, Plant & Equipment(143,286) (143,286) (87,673)
Purchase of Software(16,728) (16,728) (15,603)
Advances to Team Members- - (3)
NET CASH FLOWS FROM INVESTING ACTIVITIES(155,032) (155,032) (89,173)
Cash Flows From Financing Activities
Proceeds of Long Term Loans40,554 40,554 320
Dividend Paid to Shareholders(59,412) (59,412) (48,335)
Repayment of Loans(32,421) (32,421) (26,755)
Lease Payments NZ IFRS16 (100,644) - -
NET CASH FLOWS FROM FINANCING ACTIVITIES(151,923) (51,279) (74,770)
NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS(6,155) (6,155) 33,480
Net Foreign Exchange Differences7,109 7,109 1,215

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD115,180 115,180 80,485
CASH AND CASH EQUIVALENTS AT END OF PERIOD116,134 116,134 115,180
Comprised
Bank and Short Term Deposits116,140 116,140 115,184
Bank Overdraft(6) (6) (4)
116,134 116,134 115,180
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 full year ended 31 March 2020 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 2019 financial statements except for
the adoption of NZ IFRS 16 Leases.
(Please see Note 2 (f) of the Financial Statements in the March 2019 Annual Report for further information).
These March 2020 Financial Statements have shown results pre NZ IFRS 16 and post NZ IFRS 16.
The impact on profit before tax was a reduction of $11,233,000 and after tax by $8,129,000 net in the year to 31 March 2020.
The impact on EBITDA (adjusted) was an increase of $117,665,000. There is no impact on cash flows.
The impact on total assets was an increase of $618,040,000, an increase in total liabilities of $626,451,000 and a decrease
in Shareholder's Equity of $8,411,000 (see below).
$000
Total Assets as per 31 March 2020 Balance Sheet
2,304,594
Less Right of Use Assets
(615,250)
Change in Deferred Tax Asset
(2,790)
Total Assets after removing NZ IFRS 16 Leases Impact
1,686,554
Total Liabilities as per 31 March 2020 Balance Sheet
1,338,255
Less Current Lease Liability for Right of Use Assets
(124,128)
Less Non-current Lease Liability for Right of Use Assets
(502,734)
Change in Deferred Tax Liability
411
Total Liabilities after removing NZ IFRS 16 Leases Impact
711,804
Total Shareholders' Equity as per 31 March 2020 Balance Sheet
966,339
Add back NZ IFRS 16 Leases Impact on Profit for the Period (Accumulated Surplus)
8,129
Add back Movement in Foreign Currency Translation Reserve
282
Total Shareholder's Equity after removing NZ IFRS 16 Leases Impact
974,750
3
Required NZX DisclosuresParent
Movements in Ordinary Shares on Issue
20202019
SharesShares
Closing Balance100,698,548 100,698,548
Average Balance During Year100,698,548 100,698,548
Net Tangible Assets
20202019
$000$000
Net Tangible Assets735,195 619,405
Net Tangible Assets per Security (cps)730.09615.11
Net Tangible Assets includes Software and Deferred Tax Assets and Liabilities.
Dividends Paid and Proposed
20202019
$000$000
Recognised Amounts
Declared and Paid During the Year to Parent Shareholders
Final Fully Imputed Dividend for 2019: 34.0 cents (2018: 26.0 cents)34,237 26,182
Interim Fully Imputed Dividend for 2020: 25.0 cents (2019: 22.0 cents)25,175 22,153
59,412 48,335
Unrecognised Amounts
Final Fully Imputed Dividend for 2020: 34.0 cents (2019: 34.0 cents)34,238 34,238
After the balance date, the above unrecognised dividends were approved by directors' resolution dated 26 May 2020.

4Abnormal Items
Abnormal items are determined in accordance with the principles of consistency, relevance and clarity. Transactions
considered for classification as abnormal items include acquisition and disposal costs; impairment or reversal of
impairment of assets; business integration; and transactions or events outside of the Group’s ongoing operations that
have a significant impact on reported profits.
During the year the Group had $4,784,000 of abnormal expenses (2019 $4,965,000). The related after tax expense
was $3,475,000 (2019 $3,460,000).
In the year the Group had no abnormal gains (2019 nil). The related after tax gain was $14,701,000 (2019 nil).
These items comprised of:
2020 Year
Pre-TaxTaxAfter Tax
$000$000$000
Brand Name Impairment***(3,949) 987 (2,962)
Redundancies(835) 322 (513)
Building Depreciation Taxation ##- 14,701 14,701
(4,784) 16,010 11,226
2019 Year
Pre-TaxTaxAfter Tax
$000
$000$000
Brand Name Impairment***(3,912) 978 (2,934)
Redundancies(1,053) 527 (526)
(4,965) 1,505 (3,460)
***With the process of rebranding our European operations to Mainfreight largely completed it was decided to
impair the purchased brand of Wim Bosman by one third in the 2020 financial year (2019 one third).
This impairment entry has no cash impact. The brand has now been fully written off.
##In New Zealand, depreciation on buildings is now allowed as a tax deduction from the 1 April 2020. This law
change has resulted in a change from a deferred tax liability to a deferred tax asset in the Consolidated
Balance Sheet with a movement of $14,701,000. This resulted in a corresponding reduction in tax expense.
This tax entry has no cash impact.
5
Annual Report and Annual Meeting
The annual report is expected to be available on 26 June 2020.
The Annual Meeting is to be held at 4.00pm on Thursday 30 July 2020; venue to be advised.

5Segmental 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 2020 and 31 March 2019.
Year Ended 31 March 2020
NewAustraliaTheAsiaEuropeInter-Total
Post NZ IFRS 16ZealandAmericasSegment $000
Operating Revenue
-Sales to customers 752,913 796,545 761,950 94,786 689,200 - 3,095,394
outside the group
-Inter-segment sales396 20,352 48,421 73,489 38,133 (180,791) -
Total Revenue753,309 816,897 810,371 168,275 727,333 (180,791) 3,095,394
EBITDA (adjusted)139,767 104,809 60,407 8,334 85,354 - 398,671
Depreciation & Amortisation46,799 45,164 24,481 2,945 50,340 - 169,729
Capital Expenditure62,225 71,497 9,025 1,126 16,141 - 160,014
Trade Receivables83,982 105,889 119,361 24,618 110,812 (23,823) 420,839
Non-current Assets560,315 451,269 236,302 17,765 425,898 - 1,691,549
Total Assets665,587 590,187 385,118 64,399 623,126 (23,823) 2,304,594
Total Liabilities299,026364,160258,79733,125406,970(23,823)1,338,255

Year Ended 31 March 2020
NewAustraliaTheAsiaEuropeInter-Total
Pre NZ IFRS 16 Where DifferentZealandAmericasSegment $000
EBITDA (adjusted)115,889 65,043 43,259 6,046 50,769 - 281,006
Depreciation & Amortisation24,337 8,939 7,522 734 16,320 - 57,852
Non-current Assets463,822 253,980 103,789 12,277 239,641 - 1,073,509
Total Assets569,096 392,898 252,604 58,911 436,868 (23,823) 1,686,554
Total Liabilities200,602164,775123,44227,469219,339(23,823)711,804

Year Ended 31 March 2019
NewAustraliaTheAsiaEuropeInter-Total
Pre NZ IFRS 16ZealandAmericasSegment$000
Operating Revenue
-Sales to customers 718,791 760,844 725,200 109,321 639,931 - 2,954,087
outside the group
-Inter-segment sales(590) 18,646 54,544 77,409 37,578 (187,587) -
Total Revenue718,201 779,490 779,744 186,730 677,509 (187,587) 2,954,087
EBITDA (adjusted)110,556 59,323 38,342 9,263 39,565 - 257,049
Depreciation & Amortisation22,638 8,163 6,565 657 15,084 - 53,107
Capital Expenditure48,595 20,767 9,112 1,325 23,477 - 103,276
Trade Receivables89,966 98,431 103,439 17,571 102,169 (22,200) 389,376
Non-current Assets423,238 193,231 91,048 11,802 223,506 - 942,825
Total Assets548,788 322,949 218,750 52,762 381,840 (22,200) 1,502,889
Total Liabilities210,262142,957113,09924,392196,064(22,200)664,574

Division Segments
The following table represents revenue and EBITDA (adjusted) regarding the three main types of services for the years ende
d
31 March 2019 and 31 March 2018
Year Ended 31 March 202
0DomesticWarehousingAir & OceanTotal
TransportForwarding $000
Revenue1,576,320 383,728 1,135,346 3,095,394
EBITDA (adjusted) Post NZ IFRS 1
6223,534 101,961 73,176 398,671
EBITDA (adjusted) Pre NZ IFRS 1
6171,308 50,526 59,172 281,006
Year Ended 31 March 201
9DomesticWarehousingAir & OceanTotal
TransportForwarding $000
Revenue1,450,942 346,567 1,156,578 2,954,087
EBITDA (adjusted
)156,681 37,282 63,086 257,049
Post NZPre N
ZPre NZ
IFRS 16IFRS 16IFRS 16
Reconciliation between non-GAAP and the Income Statemen
t202020202019
$000$000$000
Profit Before Taxation for the Yea
r201,470 212,703 192,109
Abnormal Items4,783 4,783 4,965
Profit Before Abnormal Items and Taxation for the Yea
r206,253 217,486 197,074
Interest Incom
e(658) (658) (673)
Finance Costs Relating to Lease Liabilitie
s17,021 - -
Other Finance Cost
s6,326 6,326 7,541
EBIT
A228,942 223,154 203,942
Depreciation of Right of Use Asset
s111,877 - -
Other Depreciation and Amortisation Expense
s57,852 57,852 53,107
EBITDA (adjusted)398,671 281,00
6 257,049
EBITDA (adjusted) is defined as earnings before net interest expense, tax, depreciation, amortisation, abnormal items and
royalties (segment only; not group).
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.

Distribution Notice
(for Equity Security issuer/Equity and Debt Security issuer)
Section 1: Issuer Information
Name of Issuer
Financial product name/description
NZX ticker code
ISIN
Full YearXQuarterly
Half YearSpecial
DRP Applies
Record date
Ex-Date (one business day before the Record
Date)
Payment date (and allotment date for DRP)
Total monies associated with the distribution
Source of distribution (for example, retained
earnings)
Currency
Section 2: Distribution Amounts per Financial Product
Gross Distribution
Total Cash Distribution
Excluded Amount (applicable to listed PIEs)
Supplementary Distribution Amount
Is the Distribution imputed?
If fully or partially imputed, please state
imputation rate as % applied
Imputation tax credits per financial product
Resident Withholding Tax per financial product
Authority for this Announcement
Name of person authorised to make this
announcement
Contact person for this announcement
Contact phone number
Contact email address
Date of release through MAP
Mainfreight Limited
Ordinary Shares
MFT
NZMFTE0001S9
Type of distribution
(Please mark with an X in the
relevant box/es)
10/07/2020
9/07/2020
17/07/2020
$34,237,506
Retained earnings
NZD
$0.47222222
$0.34000000
$0.06000000
Section 3: Imputation Credits and Resident Withholding Tax
Yes
100%
$0.13222222
$0.02361111
Section 4: Distribution Re-investment Plan (not applicable)
tim@mainfreight.com
27/05/2020
Tim Williams, Chief Financial Officer
Tim Williams
+64 9 259 5510

Results announcement
(for Equity Security issuer/Equity and Debt Security issuer)
Results for announcement to the market
Name of IssuerMainfreight Limited
Reporting Period12 months to 31 March 2020
Previous Reporting Period12 months to 31 March 2019
CurrencyNZD
Amount (000s)Percentage Change
Revenue from Continuing Operations$3,095,3944.8%
Total Revenue$3,095,3944.8%
Net Profit/(Loss) from Continuing Operations$159,20115.7%
Total Net Profit/(Loss)$159,20115.7%
Interim/Final Dividend
Amount per Quoted Equity Security$0.34000000
Imputed Amount per Quoted Equity Security$0.06000000
Record Date10/07/2020
Dividend Payment Date17/07/2020
Current PeriodPrior Comparable Period
Net tangible assets per Quoted Equity Security
$7.3009$6.1511
A brief explanation of any of the figures above
necessary to enable the figures to be
understood
Name of person authorised to make this
announcement
Contact person for this announcement
Contact phone number
Contact email address
Date of release through MAP
27/05/2020
Unaudited financial statements accompany this announcement.
Current period includes impact of NZ IFRS16 Leases but
prior period does not. Excluding the impact of NZ IFRS16
the Net Profit % change would have been a 21.6% increase
with Total Net Profit being $167,330. The NTA per share
would have been $7.3845.
Authority for this Announcement
Tim Williams, Chief Financial Officer
Tim Williams
+64 9 259 5510
tim@mainfreight.com

---

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

* EBITDA (Adjusted): Earnings before net interest expense, tax, depreciation, amortisation, abnormal
items, royalties (segment only; not Group)
Supporters of
MAINFREIGHT – GLOBAL LOGISTICS

MAINFREIGHT LIMITED

Financial result for the twelve months ended 31 March 2020 (Unaudited)

Commentary
Mainfreight is pleased to announce our full year financial results to 31 March 2020; a
satisfactory improvement on the prior year. Sales revenues for the year are $3.09 billion,
and net profit before abnormals $147.98 million. A dividend of 34 cents per share has
been approved, payable on 17 July 2020.

As with our half-year financial results released in November 2019, the full year financial
results are reported under the NZ IFRS 16 Leases standard, which took effect for our
accounting periods commencing from 1 April 2019. For the purpose of providing clarity,
we have provided figures for the full year with and without applying NZ IFRS 16, in both
our financial statements and in this commentary.

Without NZ IFRS 16 (“apples with apples”)
Revenue $3.095 billion Up $141.31 million or 4.8%
EBITDA* $281.01 million Up $23.96 million or 9.3%
Net profit $156.10 million Up $15.02 million or 10.6%

Adjusted for foreign exchange impact, revenue is up 3.6%, EBITDA up 8.6%, and net
profit (before abnormals) is up 9.9%. Abnormal items reflect a gain of $11.23 million, and
include a positive tax adjustment of $14.70 million, one-off redundancy costs in Europe
of $0.51 million, and $2.96 million relates to the final write-off of the European brand
name.

- 2 -

Under NZ IFRS 16 (“apples with oranges”)
Revenue $3.095 billion Up $141.31 million or 4.8%
EBITDA $398.67 million Up $141.62 million or 55.1%
Net profit $147.98 million Up $6.89 million or 4.9%

NZ IFRS 16 introduces a single lessee accounting model, requiring Mainfreight as a
lessee to recognise assets and liabilities for all leases with a term of more than 12 months.
As a lessee, we are required to recognise a right-of-use asset representing our right to
use the underlying leased asset, and a lease liability representing our obligation to make
lease payments.

The impact of NZ IFRS 16 on profit before tax for the full year is a decrease of
$11.23 million (net profit decrease of $8.13 million), but an increase in EBITDA of $111.88
million. Total assets increased by $618.04 million to $2.305 billion.

We are pleased with this result, and the contributions and development of all our
businesses across the world. This financial performance provides us with the confidence
to now tackle the ongoing supply chain disruptions brought about by the COVID-19
pandemic, and the depressed economic conditions we expect to encounter.

As noted in our trading updates released on 8 April 2020, the Company has taken a
number of actions to lessen the impact of the COVID-19 pandemic, as trading conditions
become uncertain. The following measures remain in place and have assisted the
business to transition through the pandemic crises in as reasonable shape as we could
expect:
 Hiring freeze in place, and our usual annual wage and salary review deferred
 Elimination of casual labour, and holiday leave utilised where appropriate
 All unnecessary discretionary expenditure reduced
 A 50% reduction in Managing Director’s salary and other Directors’ fees
 The New Zealand Government’s wage subsidy was accessed in early April, but has
been returned (see commentary below for more detail)
 Capital expenditure of $120 million has been deferred.

- 3 -

Trading across the global business for the seven weeks from 1 April 2020, has seen sales
revenues improve 5.7% on the prior year (down 0.3% excluding FX), bolstered in part by
air charter revenues, albeit at lower margins. Profit before tax is $9.0 million, down
$6.48 million. This trading update is an estimate, based on the weekly profit and loss
details provided by our 282 world-wide branches.

Group Operating Cash Flows
Operating cash flows were $300.80 million ($200.16 million pre-NZ IFRS 16), up from
$197.42 million in the prior year, reflecting increased profitability and acceptable cash
collection.

Current debt facilities total $499 million, of which $235 million remained undrawn. Net
debt at 31 March 2020, was $157.38 million, up from $130.48 million at 31 March 2019,
an increase of $26.90 million. Gearing ratios remained consistent at 14.0% (13.5% at 31
March 2019).

At 30 April 2020, net debt is estimated at $132 million. Cash collection remains
satisfactory across all five regions.

During the year net capital expenditure totalled $155.03 million, with expenditure for land
and buildings accounting for $111.72 million, plant and equipment of $26.64 million, and
information technology of $16.67 million.

With our decision to defer several capital projects, our expectations are for capital
expenditure for the full financial year ending 31 March 2021 to be approximately
$80 million.

Dividend
After careful consideration, the Directors have approved a final dividend at the same level
as the prior year, being 34.0 cents per share fully imputed at the 28% company tax rate.
With the record date on 10 July 2020; payment will be made on 17 July 2020.

This decision was made following careful review of the Company’s position including
current and expected trading, capital expenditure requirements, cash flows and debt
facility levels. This takes the full dividend for the year to 59.0 cents per share; a 5.4%
increase year on year.

- 4 -

Divisional Performance (figures in local currencies)

New Zealand (NZ$)
Revenue $752.91 million Up $34.12 million or 4.7%
EBITDA (pre-NZ IFRS 16) $115.89 million Up $5.33 million or 4.8%
EBITDA (post-NZ IFRS 16) $139.77 million

Our New Zealand businesses continued to expand the network, giving us a stronger
regional presence across all three products.

Although we have chosen to reduce capital expenditure in the 2021 financial year, we will
continue with the completion of our new Transport facilities for Mount Maunganui, Levin,
Blenheim, Gore and Oamaru.

Additional Warehousing sites, some leased, are being considered for Auckland.

Our Air & Ocean division continued to find market share and post-year end has had
considerable success in gaining new customers

April/May 2020 Trading Estimates
Lockdown Level 4 26 March to 27 April 2020
Lockdown Level 3 28 April to 14 May 2020
Lockdown Level 2 15 May

During the seven-week trading period to 19 May 2020, New Zealand has seen a 16%
decline in sales revenues, and a resulting reduction in profit before tax to be at
break-even, down $7 million. Trading improved as New Zealand moved from Alert Level
4 through to Level 2, with some May weekly profits now exceeding those of the equivalent
weeks in the prior year.

Taking a somewhat cautious view, we expect to see Transport volumes increase; delivery
expectations are being met and we have good levels of sales activity. We are seeing
increased enquiry for our Warehousing solutions, and significant air freight volumes are
being moved via air charters to and from Asia and the USA.

- 5 -

Australia (AU$)
Revenue AU$756.80 million Up AU$46.63 million or 6.6%
EBITDA (pre-NZ IFRS 16) AU$61.80 million Up AU$6.42 million or 11.6%
EBITDA (post-NZ IFRS 16) AU$99.60 million

A strong recovery during our second half was led by pleasing progress from our
Warehousing and Transport divisions.

Warehousing increased their footprint by an additional 18,400m
2
, with utilisation of 87%
at year end. The majority of this new volume has found its way into our domestic
Transport freight network.

Transport’s regional expansion has seen improving profitability from branches alongside
an increasing number of new customers.

Our Air & Ocean operations have continued on steadily, albeit not developing similar
levels of air freight activity as the other regions

April/May 2020 Trading Estimates
Partial lockdown April / May 2020

The partial lockdown response by the Australian Government has seen freight volumes
continue at more-or-less normal trading levels.

Sales revenues for the seven-week period increased 13% compared to the same period
in the prior year, and profit before tax improved to AU$6 million, up by AU$4 million.

Strong sales enquiry continues and gains in market share see results improving through
May. We expect this to continue through the 2021 financial year.

- 6 -

Europe (Euro €)
Revenue EU€401.39 million Up EU€25.11 million or 6.7%
EBITDA (pre-NZ IFRS 16) EU€29.57 million Up EU€6.30 million or 27.1%
EBITDA (post-NZ IFRS 16) EU€49.70 million

Ongoing improvement in our levels of service, better freight mix, warehouse
management, and an increase in sales capability has resulted in progress for our
European operations.

In our Transport division, stronger cross-dock and vehicle management has seen
margins improve, with a significant increase in sales revenues.

Warehousing utilisation improved, and a further commitment to increasing our
Zaltbommel facility with a “phase 2” development of 26,000 m2 was completed.
Utilisation across all facilities is currently at 93.9%.

Our Air & Ocean business saw nominal revenue growth and a decline in profits, as
additional overhead costs were incurred in developing network and sales capability,
including the opening of our first Spanish operation, in Barcelona.

April/May 2020 Trading Estimates
Lockdown Different levels adopted by each country
Full lockdown For Spain, Italy, France, UK and Russia (now starting to relax)
Partial lockdown Across the balance
Borders remained open for freight

Trading for April and May saw short weeks due to several public holidays, impacting
already depleted freight volumes and activity.

Sales revenues declined 5% in the seven weeks compared to the same period last year,
with profit before tax at break-even, down EU€1 million.

As European countries begin to reopen for trading, we are seeing freight volumes
improve, and pick activity in our warehouses increase. Our Air & Ocean operations have
had more frequent import air freight shipments

- 7 -

Asia (US$)
Revenue US$61.36 million Down US$13.08 million or 17.6%
EBITDA (pre-NZ IFRS 16) US$3.91 million Down US$2.39 million or 37.9%
EBITDA (post-NZ IFRS 16) US$5.40 million

Our Asian business has had a disappointing finish to the year, as US import tariffs
reduced volumes from China, and activity from Hong Kong decreased due to civil unrest,
both contributing to lacklustre financial results for the full year.

The pandemic coincided with the usual Chinese New Year shut down of trade, and
affected freight volume to and from all regions during February and March. While
production in China has returned, the inability of importers to receive product under the
varying levels of lockdown within our other regions, has seen fluctuating freight tonnage.

Development of our Southeast Asian operations remains a key to diversifying our Asian
business and reducing reliance on China trade alone.

April / May 2020 Trading Estimate
Lockdown Restrictions in China have eased, but remain more substantial in
Southeast Asia

The seven-week period from 1 April 2020 has seen revenues improve 41% on the same
period last year, and profit before tax increase by US$0.5 million to US$1.1 million. The
large revenue increase is assisted by low margin air charter activity from China and Hong
Kong. We expect this level of improvement to continue for a period of time, particularly
while demand for PPE product continues.

We continued to expand the network in Southeast Asia with the opening of our first branch
in South Korea, in Seoul.

- 8 -

The Americas (US$)
Revenue US$493.29 million Down US$0.57 million or 0.1%
EBITDA (pre-NZ IFRS 16) US$28.01 million Up US$1.90 million or 7.3%
EBITDA (post-NZ IFRS 16) US$39.11 million

A mixed result from our USA business, as sales revenues flat lined with lower than
expected sales gains in Transport and Air & Ocean operations. EBITDA however showed
improvement as Transport managed road volume better, improving margins.
Warehousing activity levels also lifted their result.

CaroTrans, our wholesale sea freight consolidation business, finished ahead of the year
prior with improving margins.

Our Warehousing division has seen good development throughout the year, and has
further increased its footprint to 85,935m
2
, an increase of 44%. Utilisation across the
business was 79.0% at year end.

In our Transport business, we continue to be focused on growing our own road line-haul
network, along with gaining more FMCG customers, to better complement our desire for
regular, every day freight volumes.

The Air & Ocean division struggled earlier in the first half year with declining revenues,
particularly related to China imports. Our four largest branches have since split their air
and sea operations, to allow greater focus on these two distinct modes and we have seen
some early signs of improvement.

April / May 2020 Trading Estimate
Lockdown Restrictions vary by State in the USA (“stay at home” mandate is
widespread), and in areas of Canada, Chile and Mexico

As the USA moved into full lockdown, Transport freight volume declined significantly.
Stronger air freight volume has assisted Air & Ocean revenue to increase.

Sales revenues overall have remained in line with the year prior during the seven weeks
from 1

April 2020, however profit before tax has declined to US$1 million, a reduction of
US$2 million. Operating margins have reduced through poor transport utilisation and air
charters from Asia.

- 9 -


The Americas remains a key area of development potential for us.

Based on the weekly results and discussions with our team, the economic effects of the
pandemic may well be greater and last longer in the USA than in other parts of our global
network.


New Zealand Wage Subsidy
Early in the New Zealand lockdown, our New Zealand Transport and Warehousing
operations experienced significant revenue reduction. We were uncertain at this time,
just how bad trading would become. Uppermost in our minds was the protection of jobs
for our people.

Accordingly, we applied for and were granted the Government 12-week wage subsidy.
We applied for a total of 1,526 people. The $10.61 million subsidy was received by
16 April.

Pleasingly, our trading levels have improved through late April and into May, and our
efforts to reduce overhead costs, defer capital expenditure, and gain new business in the
period, have been relatively successful. Our offshore businesses have also traded better
than expected for the most part. Cash flows remain positive, and our bank debt headroom
has not been needed.

Therefore we are in a better position than many, and while qualifying under the
Government’s criteria, we felt it was appropriate to return the subsidy.

We are supportive of the Government measures taken in these extreme circumstances,
with the aim to protect New Zealand employment. Our congratulations to them for those
decisions.

- 10 -

Outlook
The past year’s result is satisfactory and confirms the ongoing success of our growth
strategies.

The COVID-19 pandemic has had a significant impact, and will continue to affect
economic conditions for some time. While freight remains able to cross borders, slowing
consumer demand will see freight volumes and supply chain activity contract.

In the first seven weeks of trading in the 2021 financial year, Mainfreight has adapted as
well as we would have expected to the erratic trading conditions. We have been positively
surprised at the levels of activity in New Zealand, Australia, Asia, and some parts of
Europe, and this has been reflected in our estimated weekly profits in April and May. The
Americas region has seen less activity than others, and appears to be the one region that
will take more time for us to see a significant level of recovery.

The actions taken by the business to reduce costs and adapt to the economic changes is
providing a measure of assurance for the year ahead. Our sales teams are very active
and we are gaining new business.

We have full confidence in our strategies, network, customers – and most importantly,
our people – to deliver improving results as we progress through a period of uncertain
economic recovery.

We remain cautiously optimistic.


Mainfreight will release its financial results for the first half of the 2021 financial year to
the market on 11 November 2020.

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