Mainfreight Limited – Trading Update 2 February 2022

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
NZX MARKET RELEASE


2 February 2022


MAINFREIGHT LIMITED – TRADING UPDATE


Mainfreight Limited (NZX: MFT) is pleased to provide this trading update in the interests of
keeping the market informed, providing insight into supply chain congestion (both
domestically and internationally), and the effects of the Covid-19 Omicron outbreaks
across the regions within which Mainfreight operates.

Financial Trading Update
Today’s information covers 43 weeks of trading and is based on 1 April 2021 to
31 December 2021 monthly financial statements, plus weekly financials for January 2022:


This Year Last Year

This Year Last Year


Revenue* Revenue*
Var

PBT PBT
Var
Segmental by Region

$000 $000
%

$000 $000
%

New Zealand
NZ$
902,081 673,838
34%
103,217 74,556
38%
Australia
AU$
939,573 707,347
33%
86,640 59,082
47%
Americas
US$
841,078 451,306
86%
74,230 18,911
293%
Europe
EU€
451,514 334,211
35%
22,432 13,245
69%
Asia
US$
203,314 92,117
121%
24,035 7,100
239%


Total Mainfreight Group NZ$ 4,134,917 2,848,150
45%
372,019 200,763
85%




This Year Last Year

This Year Last Year


Revenue* Revenue*
Var

PBT PBT
Var
Segmental by Product

$000 $000
%

$000 $000
%

Transport
NZ$
1,536,806 1,294,404
19%
141,652 108,065
31%
Warehousing
NZ$
465,896 368,661
26%
43,700 32,059
36%
Air & Ocean
NZ$
2,132,215 1,185,085
80%
186,667 60,639
208%


Total Mainfreight Group NZ$ 4,134,917 2,848,150
45%
372,019 200,763
85%
* Excludes Inter-company revenue

Mainfreight Limited – Trading Update
2 February 2022



- 2 -
Commentary
These financial results are not a surprise, rather a continuation of the increasing
freight volumes and trends seen in our first-half results. They are also a reflection
of the improving financial performance across our Asia, Europe and Americas
businesses.

International shipping and airfreight continue to be impacted by congestion, and
with demand far exceeding supply, freight rates remain elevated.

Covid-19/Omicron restrictions have impacted service levels through absenteeism in
our Australia, Europe and Americas operations. At the time of release, we have yet
to see any impact in our New Zealand and Asia businesses, albeit China’s border
restrictions are tightening.

We expect elevated freight volumes to continue as the calendar year progresses,
with managing service levels on behalf of our customers a key priority.

Regional Overview

New Zealand
Partial Alert Levels | Auckland border restrictions during the period

A vaccination mandate for all of our New Zealand team members became effective
on 17 January 2022. Preparations continue for absenteeism as a consequence of
the Omicron variant outbreak.

Domestic Transport volumes remain at elevated levels compared to prior periods,
with 2021 Christmas volumes the largest on record.

Our Warehousing business sees demand at its highest levels as customers look to
increase their stock holdings. Additional facilities are providing capacity and we
have new Warehousing building projects underway in Hamilton and Auckland.

Mainfreight Limited – Trading Update
2 February 2022



- 3 -
Air & Ocean freight demands remain strong both inbound and outbound. Space
restrictions continue with most major shipping lines selectively allocating space.

Australia
A variety of restrictions during the period largely influenced by Omicron

Trading across all three products maintained the momentum of the half-year.
However congestion issues due to Omicron infection and isolation rates saw
services restricted in our Sydney operations late-December and into January. As a
consequence, the financial performance in our Transport branches was affected
during this time. Service levels have since improved. Volumes are expected to
remain strong through to year-end.

Warehousing volumes are consistent; new facility construction is underway in
Sydney, Perth, Adelaide and Melbourne, with additional sites being sought in
Brisbane.

Our Air & Ocean division’s activity reflects volumes and space restrictions
experienced elsewhere in the world.

Europe
High Omicron infection rates across Europe from December

While team numbers have been reduced as the virus infection levels restrict work
access, our European operations are maintaining satisfactory service levels and
financial performance is pleasing.

Our Transport performance is satisfactory with volumes improving into our
seasonal peak post-January. Warehousing volumes are on the increase with
inquiries for additional space continuing to be strong. New customer gains see a
further 10,000 pallets awaiting implementation.

Mainfreight Limited – Trading Update
2 February 2022



- 4 -
As with our global network, Air & Ocean volumes continue to be elevated,
particularly imports from Asia. Trans-Atlantic growth is a key priority to offset
capacity constraints out of Asia.

Asia
Varying Covid-19 restrictions across all countries

Air & Ocean volumes increased significantly reflecting the global demand out of
Asia. Space constraints remain with shipping lines. Airfreight space and rate levels
fluctuate, depending on seasonality and volume demand. Forward bookings post-
Chinese New Year (31 January to 6 February) remain encouraging.

We expect to open our first Indonesia branch in Jakarta in mid-2022.

The Americas
Restrictions continuing as a consequence of Omicron

Elevated volume levels in our Air & Ocean business continue for both Mainfreight
and CaroTrans, predominantly inbound into the USA. CaroTrans has experienced
a surge of demand for LCL space which is assisting revenue and profit levels.

In our Transport division, volumes and financial performance are improving, with
the expectation of more growth in this sector.

Our Warehousing business has seen strong demand for space, with utilisation and
activity levels continuing to improve. New branches in Dallas, LeHigh Valley
(Pennsylvania) and Toronto are performing satisfactorily, and additional larger sites
are being sought for Los Angeles and Newark.

Mainfreight Limited – Trading Update
2 February 2022



- 5 -
Global Air & Ocean Trade-Lanes
These remain congested with shipping lines continuing to allocate space on a
when-available basis. Rate structures remain elevated with expectations this will
continue for some time to come.

Port congestion and restricted container equipment supply, particularly across Asia
and the USA, remains a concern and is contributing to the congestion issues.

We continue to lobby shipping lines for space availability on behalf of our customers
– with some success, including finding alternative solutions where possible.
However, some of the customer growth we are experiencing may be limited by
these conditions in the short term.

To Close
A satisfactory year-to-date result. Navigating constraints due to Omicron-enforced
absenteeism remains a priority for us. Meeting our current customer service
requirements is a key objective through to year-end.

Our intensive network model, with multiple branches and warehouses, provides us
with access to alternatives, should we encounter infection issues at specific sites.
Contactless delivery with increased safety protocols, and split shifts in our
warehouses, are also being applied in preparation for further Covid-19 disruption.

Our full year financial results to 31 March 2022 will be released to the market on
Thursday 26 May 2022.

Ends

Don Braid
Group Managing Director

Mainfreight Limited
2 Railway Lane, Otahuhu, Auckland 1062
PO Box 14038, Panmure, Auckland 1741
Email: don@mainfreight.com