Listed logistics company Fliway says it now expects revenue for the fiscal year 2017 (FH17) revenue to exceed the $82.6 million achieved in FY16.
It says revenue in the second half of 2017 (2H17) is estimated to be approximately 4.8% ahead of the $38.8 million made in the prior comparable period.
The company says it is working to manage capacity issues as it continues to experience transport volumes significantly ahead of previous years and with linehaul equipment availability remaining reduced, this has led to short term fleet capacity constraints.
As a result, Fliway has to utilise higher cost external freight capacity to support the increased volumes.
This is a temporary measure until it’s fleet capacity is expanded, with new equipment expected to be delivered progressively over the next six months.
Labour market conditions have also remained tight, and Fliway has continued to place considerable effort into effective recruitment practices as we look to grow our workforce.
Also, Fliway’s earnings contribution from UPS-Fliway, the joint venture with UPS, has been reduced as a result of the conscious strategy designed to improve the cost of delivering a package in New Zealand to drive growth.
The import package volumes are lifting, but the growth is currently not enough to offset the changes made in the joint venture compensation model.
As a result, earnings before interest, taxation, depreciation and amortisation (EBITDA) for FY17 is now expected to be in the range of $8.0 to $8.3 million.
It expects net profit after tax (NPAT) to be in the range of $3.5 to $3.8 million, down from the earlier expectation of $4.2 to $4.4 million.
Fliway says its revenue continues to grow, with a strong pipeline and high rates of conversion evident throughout the second half of FY17, continuing the trend from the first half of the year.
Growth in revenue is crucial to developing the company’s longer term earnings potential and delivering on scale and efficiency objectives.
Fliway says it will continue to invest in capacity to service these increased volumes.
