TIDMBXB
RNS Number : 2633H
Brambles Limited
17 February 2010
Brambles Limited
Company Number: 118 896 021
17 February 2010 Australian Securities Exchange
& Media Release
Brambles reports first-half result for 2010 financial year: strong
cash
performance but trading conditions remain subdued
Brambles Limited today reported its results1 for the first six months of the
2010 financial year. Key elements included:
· Sales revenue down 2% to US$2,086.1 million
· Statutory operating profit down 3% to US$338.1 million
· Free cash flow after dividends of $US133.3 million, up US$223.9 million
· Underlying profit2 down 30% to US$340.2 million
· Statutory profit after tax up 2% to US$206.7 million
· Earnings per share3 down 8% to 14.8 US cents
Brambles CEO Tom Gorman said: "Business conditions for CHEP and Recall in the
first half of the 2010 financial year were weaker than the first half of the
2009 financial year, especially during the first three months.
"At the same time, we continued to generate significant positive cash flow and
invest in our long-term future. We are well-placed to return to growth as
business conditions gradually improve and initiatives put in place for the
long-term show results."
The lower sales revenue and statutory operating profit were predominantly a
result of the subdued business conditions in some of our largest markets: the
USA, the UK and Spain. Underlying profit was impacted by the rollout of the
Better Everyday program in CHEP USA.
Brambles' strong cash flow result reflected ongoing financial discipline and
reduced capital expenditure. This occurred while the company continued to invest
in initiatives that will underpin its long-term profitable growth.
"The Better Everyday program, our investment in improving quality and service in
CHEP USA, is meeting production and customer satisfaction targets," Mr Gorman
said. "The restructuring investments we undertook in the 2009 financial year are
generating savings as planned.
"Most of our operations continued to grow sales revenue in the half, including
established CHEP markets such as Australia, Canada and South Africa and less
mature CHEP markets such as Italy, Central & Eastern Europe and Latin America.
"CHEP's reusable plastic containers (RPCs) business and Recall's Document
Management Solutions (DMS) business also delivered solid growth. All Brambles'
business units except CHEP Americas had net new business wins4 during the
period."
1 All growth figures are on a constant currency basis. Brambles calculates
constant currency by translating non-US dollar results at the exchange rates
applicable during the prior corresponding period.
2 The difference in growth rates between statutory operating profit and
Underlying profit reflects the impact of Significant items recognised outside of
Underlying profit (US$2.1 million in the first half of the 2010 financial year;
US$131.7 million in the first half of the 2009 financial year).
3 Earnings per share includes discontinued operations.
4 Brambles calculates net new business wins as the revenue impact of new
business and lane expansion won and lost in the reporting period, plus the net
revenue impact in the period of wins and losses in previous periods for 12
months from the date of win or loss.
End of page 1 of 14
Cash flow and balance sheet
Brambles' strong cash flow resulted from a significant reduction in capital
expenditure and an improved working capital outcome. Brambles' free cash flow
after dividends was US$133.3 million, a US$223.9 million improvement on the
prior corresponding period.
Brambles' balance sheet remains strong. Net debt at 31 December 2009 was
US$2,028.4 million, down US$115.0 million on 30 June 2009. Undrawn committed
credit facilities were US$1,317.2 million, providing ample scope to meet organic
investment and growth requirements.
Dividend
The Board of Brambles has declared an interim dividend of 12.5 Australian cents
per share, 20% franked and payable on 8 April 2010 to shareholders on the
company's register on 18 March 2010. The Board has decided to keep Brambles'
Dividend Reinvestment Plan active in relation to this payment.
Brambles Chairman Graham Kraehe said: "The interim dividend is in line with the
final dividend declared in August 2009. This reflects our focus on maintaining
an appropriate level of payout considering the ongoing economic uncertainty and
our long-term investment commitments."
Outlook
Mr Kraehe said: "The Board is confident in Brambles' long-term outlook for
profitable growth. Tom has assembled a strengthened management team and the
Directors are pleased with the progress of the Better Everyday program."
Mr Gorman said: "CHEP and Recall have outstanding business models, customer
bases and prospects for long-term profitable growth. Our strong financial
position stands us in good stead to pursue this growth as the economies in which
we operate recover.
"CHEP continues to add customers in existing markets, enter new geographies and
expand its offering of services and platforms. The Better Everyday program is on
track and showing strong early results. We expect CHEP to benefit from a
broad-based return to economic growth when it occurs.
"Recall has a strong sales pipeline and growth outlook. We expect continued
growth in the DMS business as it expands services to both new and existing
customers. The Secure Destruction Services (SDS) business has experienced an
increase in paper prices in recent months."
For further information please contact:
+-----------------------------------+-------------------------------+
| Investors and media |
+-------------------------------------------------------------------+
| Michael Roberts | James Hall |
| Vice President, Investor | Manager, Investor Relations & |
| Relations & Corporate Affairs | Corporate Affairs |
| +61 2 9256 5216 | +61 2 9256 5262 |
| +61 418 263 199 | +61 401 524 645 |
| michael.roberts@brambles.com | james.hall@brambles.com |
+-----------------------------------+-------------------------------+
Further details of Brambles' 2010 interim result are set out in the following
pages and in the Appendix 4D. Brambles management will hold a briefing on this
result to investment analysts at 11.30am on 17 February.
The company will webcast the briefing at www.brambles.com and post all
presentation materials on its website before the briefing. A replay of the
webcast including the questions and answer session will be available on the
Brambles website shortly after the live presentation concludes.
Brambles has forwarded copies of the 2010 interim result to the Financial
Services Authority. The result will shortly be available for inspection at the
UK Listing Authority's Document Viewing Facility. For further details, please
refer to www.fsa.gov.uk.
For further information on Brambles and all company announcements, presentations
and webcasts, please visit the company website at www.brambles.com.
End of page 2 of 14
Sales and profit summary
+-------------------------+---------+-------+-+---------+---------+---------------+
| Table 1 |
+---------------------------------------------------------------------------------+
| Sales revenue and statutory operating profit |
+---------------------------------------------------------------------------------+
| US$ million | 1H10 | 1H10 at | 1H09 | % | % change |
| | actual | prior | actual | change | (constant |
| | | year FX | | (actual | currency) |
| | | rates | | FX | |
| | | | | rates) | |
+-------------------------+---------+---------+---------+---------+---------------+
| Sales revenue | | | | | |
+-------------------------+---------+---------+---------+---------+---------------+
| CHEP Americas | 756.9 | 756.3 | 792.5 | (4)% | (5)% |
+-------------------------+---------+---------+---------+---------+---------------+
| CHEP EMEA | 770.1 | 756.2 | 761.0 | 1% | (1)% |
+-------------------------+---------+---------+---------+---------+---------------+
| CHEP Asia-Pacific | 195.0 | 172.8 | 166.6 | 17% | 4% |
+-------------------------+---------+---------+---------+---------+---------------+
| Total CHEP | 1,722.0 | 1,685.3 | 1,720.1 | - | (2)% |
+-------------------------+---------+---------+---------+---------+---------------+
| Recall | 364.1 | 350.9 | 353.1 | 3% | (1)% |
+-------------------------+---------+---------+---------+---------+---------------+
| Total sales revenue | 2,086.1 | 2,036.2 | 2,073.2 | 1% | (2)% |
+-------------------------+---------+---------+---------+---------+---------------+
| | | | | | |
+-------------------------+---------+---------+---------+---------+---------------+
| Statutory operating | | | | | |
| profit | | | | | |
+-------------------------+---------+---------+---------+---------+---------------+
| CHEP Americas | 108.6 | 107.9 | 79.6 | 36% | 36% |
+-------------------------+---------+---------+---------+---------+---------------+
| CHEP EMEA | 159.3 | 153.6 | 166.2 | (4)% | (8)% |
+-------------------------+---------+---------+---------+---------+---------------+
| CHEP Asia-Pacific | 32.5 | 26.8 | 28.4 | 14% | (6)% |
+-------------------------+---------+---------+---------+---------+---------------+
| Total CHEP | 300.4 | 288.3 | 274.2 | 10% | 5% |
+-------------------------+---------+---------+---------+---------+---------------+
| Recall | 52.5 | 49.7 | 49.5 | 6% | - |
+-------------------------+---------+---------+---------+---------+---------------+
| Brambles HQ | (14.8) | (11.6) | 13.9 | | |
+-------------------------+---------+---------+---------+---------+---------------+
| Statutory operating | 338.1 | 326.4 | 337.6 | - | (3)% |
| profit | | | | | |
+-------------------------+---------+---------+---------+---------+---------------+
| Net finance costs | (54.0) | (53.8) | (63.7) | 15% | 16% |
+-------------------------+---------+---------+---------+---------+---------------+
| Profit before tax | 284.1 | 272.6 | 273.9 | 4% | - |
+-------------------------+---------+---------+---------+---------+---------------+
| Tax expense | (77.4) | (74.3) | (78.6) | 2% | 5% |
+-------------------------+---------+---------+---------+---------+---------------+
| Profit from continuing | 206.7 | 198.3 | 195.3 | 6% | 2% |
| operations | | | | | |
+-------------------------+---------+---------+---------+---------+---------------+
| Profit from | 0.4 | 0.4 | 17.5 | | |
| discontinued operations | | | | | |
+-------------------------+---------+---------+---------+---------+---------------+
| Profit for the period | 207.1 | 198.7 | 212.8 | (3)% | (7)% |
+-------------------------+---------+---------+---------+---------+---------------+
| | | | | | |
+-------------------------+---------+---------+---------+---------+---------------+
| Weighted average number | 1,403.8 | 1,403.8 | 1,383.8 | | |
| of shares (millions) | | | | | |
+-------------------------+---------+---------+---------+---------+---------------+
| EPS (USc) | 14.8 | 14.2 | 15.4 | (4)% | (8)% |
+-------------------------+---------+---------+---------+---------+---------------+
| EPS (Ac) | 16.8 | 18.6 | 19.5 | (14)% | (5)% |
+-------------------------+---------+---------+---------+---------+---------------+
| Interim dividend | 12.5 | 12.5 | 17.5 | | |
| (Ac per share) | | | | | |
+-------------------------+---------+---------+---------+---------+---------------+
| | | | | | |
+-------------------------+---------+-------+-----------+---------+---------------+
| | | | | | | |
+-------------------------+---------+-------+-+---------+---------+---------------+
End of page 3 of 14
+-------------------------+---------+---------+---------+---------+-----------+
| Table 2 |
+-----------------------------------------------------------------------------+
| Underlying profit |
+-----------------------------------------------------------------------------+
| US$ million | 1H10 | 1H10 | 1H09 | % | % |
| | actual | at | actual | change | change |
| | | prior | | (actual | (constant |
| | | year | | FX | currency) |
| | | FX | | rates) | |
| | | rates | | | |
+-------------------------+---------+---------+---------+---------+-----------+
| Underlying profit | | | | | |
+-------------------------+---------+---------+---------+---------+-----------+
| CHEP Americas | 108.6 | 107.9 | 233.3 | (53)% | (54)% |
+-------------------------+---------+---------+---------+---------+-----------+
| CHEP EMEA | 161.4 | 155.8 | 170.9 | (6)% | (9)% |
+-------------------------+---------+---------+---------+---------+-----------+
| CHEP Asia-Pacific | 32.5 | 26.8 | 28.9 | 12% | (7)% |
+-------------------------+---------+---------+---------+---------+-----------+
| Total CHEP | 302.5 | 290.5 | 433.1 | (30)% | (33)% |
+-------------------------+---------+---------+---------+---------+-----------+
| Recall | 52.5 | 49.7 | 50.5 | 4% | (2)% |
+-------------------------+---------+---------+---------+---------+-----------+
| Brambles HQ | (14.8) | (11.6) | (14.3) | (3)% | 19% |
+-------------------------+---------+---------+---------+---------+-----------+
| Underlying profit | 340.2 | 328.6 | 469.3 | (28)% | (30)% |
+-------------------------+---------+---------+---------+---------+-----------+
| Net finance costs | (54.0) | (53.8) | (63.7) | 15% | 16% |
+-------------------------+---------+---------+---------+---------+-----------+
| Profit before tax | 286.2 | 274.8 | 405.6 | (29)% | (32)% |
+-------------------------+---------+---------+---------+---------+-----------+
| Tax expense | (77.9) | (74.8) | (135.1) | 42% | 45% |
+-------------------------+---------+---------+---------+---------+-----------+
| Underlying profit after | 208.3 | 200.0 | 270.5 | (23)% | (26)% |
| finance costs and tax | | | | | |
+-------------------------+---------+---------+---------+---------+-----------+
| | | | | | |
+-------------------------+---------+---------+---------+---------+-----------+
| Weighted average number | 1,403.8 | 1,403.8 | 1,383.8 | | |
| of shares (millions) | | | | | |
+-------------------------+---------+---------+---------+---------+-----------+
| EPS (USc) | 14.8 | 14.2 | 19.5 | (24)% | (27)% |
+-------------------------+---------+---------+---------+---------+-----------+
| | | | | | |
+-------------------------+---------+---------+---------+---------+-----------+
+----------------------------+--------+--------+---------+--------+
| Table 3 |
+-----------------------------------------------------------------+
| Reconciliation of Underlying profit to statutory operating |
| profit |
+-----------------------------------------------------------------+
| US$ million | 1H10 | 1H09 |
+----------------------------+-----------------+------------------+
| | Before | After | Before | After |
| | tax | tax | tax | tax |
+----------------------------+--------+--------+---------+--------+
| Underlying profit (see | 340.2 | 208.3 | 469.3 | 270.5 |
| Table 2) | | | | |
+----------------------------+--------+--------+---------+--------+
| CHEP USA - pallet quality | - | - | (34.5) | (21.0) |
| program | | | | |
+----------------------------+--------+--------+---------+--------+
| CHEP USA - Walmart net | - | - | (20.2) | (12.4) |
| transition impact | | | | |
+----------------------------+--------+--------+---------+--------+
| Restructuring: | - | - | | |
+----------------------------+--------+--------+---------+--------+
| Facilities and | (2.1) | (1.6) | (7.9) | (5.7) |
| operations rationalisation | | | | |
+----------------------------+--------+--------+---------+--------+
| CHEP USA accelerated | - | - | (99.0) | (60.3) |
| scrapping of 7 million | | | | |
| surplus pallets | | | | |
+----------------------------+--------+--------+---------+--------+
| FX gain on capital | - | - | 29.9 | 29.9 |
| repatriation from foreign | | | | |
| subsidiary | | | | |
+----------------------------+--------+--------+---------+--------+
| Other | - | - | - | (5.7) |
+----------------------------+--------+--------+---------+--------+
| Total Significant items | (2.1) | (1.6) | (131.7) | (75.2) |
+----------------------------+--------+--------+---------+--------+
| Statutory operating profit | 338.1 | 206.7 | 337.6 | 195.3 |
| (see Table 1) | | | | |
+----------------------------+--------+--------+---------+--------+
| | | | | |
+----------------------------+--------+--------+---------+--------+
The Significant item in the first half of the 2010 financial year (facilities
and operations rationalisation) represents the continuation of redundancy and
plant closure expenses as part of the restructuring announced in February 2009.
The project remains on plan, with US$56.4 million charged to date.
End of page 4 of 14
Business unit operations review
CHEP Americas
+----------------------------+--------+--------+---------+-----------+
| Table 4 |
+--------------------------------------------------------------------+
| CHEP Americas |
+--------------------------------------------------------------------+
| US$ million | 1H10 | 1H09 | % | % |
| | | | change | change |
| | | | (actual | (constant |
| | | | FX | currency) |
| | | | rates) | |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Sales revenue | 756.9 | 792.5 | (4)% | (5)% |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Statutory operating profit | 108.6 | 79.6 | 36% | 36% |
+----------------------------+--------+--------+---------+-----------+
| Statutory operating profit | 14% | 10% | 4pp | 4pp |
| margin | | | | |
+----------------------------+--------+--------+---------+-----------+
| Significant items: | | | | |
+----------------------------+--------+--------+---------+-----------+
| Pallet quality program | - | 34.5 | | |
+----------------------------+--------+--------+---------+-----------+
| Walmart net transition | - | 20.2 | | |
| impact | | | | |
+----------------------------+--------+--------+---------+-----------+
| Accelerated scrapping of 7 | - | 99.0 | | |
| million surplus pallets | | | | |
+----------------------------+--------+--------+---------+-----------+
| | - | 153.7 | | |
+----------------------------+--------+--------+---------+-----------+
| Underlying profit | 108.6 | 233.3 | (53)% | (54)% |
+----------------------------+--------+--------+---------+-----------+
| Underlying profit margin | 14% | 29% | (15)pp | (15)pp |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Cash flow from operations | 139.8 | 116.9 | | |
+----------------------------+--------+--------+---------+-----------+
| |
+----------------------------+--------+--------+---------+-----------+
Sales
CHEP Americas' sales revenue was US$756.9 million, down 5%. The largest impact
was a 7% reduction in sales revenue in CHEP USA, while CHEP Canada and CHEP
Latin America generated sales revenue 3% and 5% higher respectively from a
combination of organic growth and new business.
CHEP USA's 7% decline in sales revenue resulted from lower organic issue volumes
(3%); the impact of net business losses (2%); and changes in pricing and sales
mix (2%). Overall, issue volumes in CHEP USA were down 5%. As advised at the
2009 AGM, CHEP USA anticipates pallet issue volumes for the full 2010 financial
year will be 3% lower than the 2009 financial year.
Profit
CHEP Americas' statutory operating profit rose 36% to US$108.6 million but
Underlying profit was down 54%. This difference reflects CHEP Americas'
recognition in the prior corresponding period of US$153.7 million Significant
items. In the first half of the 2010 financial year, CHEP Americas did not
recognise any Significant items. CHEP Americas has included in Underlying profit
its expenditure on quality initiatives of US$64.8 million, comprising the Better
Everyday program and the balance of the USA pallet quality program.
Volume and price reductions had a US$26 million impact on statutory operating
profit. Other profit impacts included: an US$18 million increase in the
irrecoverable pooling equipment provision (IPEP) expense, reflecting the
outcomes of audits completed in the period; and US$10 million from storing
approximately 4 million idle pallets within CHEP USA, as identified at the 2009
AGM. CHEP USA expects similar costs from storing these idle pallets in the
second half.
Cash flow
The US$22.9 million increase in cash flow from operations reflected a US$55.0
million reduction in capital expenditure, offsetting the reduction in profit.
Lower capital expenditure reflects lower overall demand and a reduction in
pallet imports and new pallet commitments in CHEP USA.
End of page 5 of 14
Better Everyday program
The US$64.8 million expenditure on the Better Everyday program, including US$37
million of spending that remained on the USA pallet quality program, was in line
with expectations. Rollout of the program is progressing well, resulting in
improvements in quality and service for customers.
Highlights of the rollout to date include:
· Delivery of the new higher repair specification is on target and customer
reaction to the higher consistency of quality has been positive:
o 94% of all issues are now at US Plus standard;
o delivery at the US Premium standard is meeting demand; and
o rejections related to pallet quality in the six months to 31 December 2009
were 62% lower than the prior corresponding period.
· Adoption of the Portfolio+Plus account administration tool is accelerating.
At 31 December 2009, 32% of CHEP USA customers had adopted the solution in line
with a full-year target of 60%.
· The new simplified invoice has been designed and tested with customers for
quality and satisfaction and is now in production for rollout beginning in the
2011 financial year.
· Realignment of the sales and marketing teams is progressing. CHEP USA has
appointed a new Senior Vice President of Sales & Marketing and is taking
additional steps to simplify its sales and marketing structure and move
decision-making closer to the customer.
The accelerated pallet scrapping program to tear down 7 million excess pallets
announced in February 2009 is proceeding ahead of schedule and in line with the
previously announced plan.
CHEP Europe, Middle East & Africa (EMEA)
+----------------------------+--------+--------+---------+-----------+
| Table 5 |
+--------------------------------------------------------------------+
| CHEP EMEA |
+--------------------------------------------------------------------+
| US$ million | 1H10 | 1H09 | % | % |
| | | | change | change |
| | | | (actual | (constant |
| | | | FX | currency) |
| | | | rates) | |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Sales revenue | 770.1 | 761.0 | 1% | (1)% |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Statutory operating profit | 159.3 | 166.2 | (4)% | (8)% |
+----------------------------+--------+--------+---------+-----------+
| Statutory operating profit | 21% | 22% | (1)pp | (2)pp |
| margin | | | | |
+----------------------------+--------+--------+---------+-----------+
| Significant items: | | | | |
+----------------------------+--------+--------+---------+-----------+
| Restructuring - facilities | 2.1 | 4.7 | | |
| and operations | | | | |
| rationalisation | | | | |
+----------------------------+--------+--------+---------+-----------+
| Underlying profit | 161.4 | 170.9 | (6)% | (9)% |
+----------------------------+--------+--------+---------+-----------+
| Underlying profit margin | 21% | 22% | (1)pp | (1)pp |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Cash flow from operations | 202.7 | 137.1 | | |
+----------------------------+--------+--------+---------+-----------+
| |
+----------------------------+--------+--------+---------+-----------+
Sales
CHEP EMEA's sales revenue was down 1% on the prior corresponding period to
US$770.1 million as a result of slower economic conditions.
Pallet issue volumes in Europe were in line with the prior corresponding period
as new business wins in less mature CHEP markets such as Italy and Central &
Eastern Europe offset a 1% reduction in organic volumes. Pallet volumes in the
region's two largest markets, the UK and Spain, were affected by weaker
economies, as were operations in the automotive sector. Excluding automotive,
sales revenue increased 1%. Net new business wins by CHEP EMEA in the period
contributed US$14 million to sales revenue. Pricing was in line with the prior
corresponding period. Sales revenue growth was 11% in Middle East & Africa.
End of page 6 of 14
CHEP EMEA recorded 10% growth in the RPC market. CHEP South Africa launched its
RPC business with Pick n Pay while retailers' use of the platform increased in
the UK.
Profit
Statutory operating profit was US$159.3 million, down 8%, and Underlying profit
was US$161.4 million, down 9%. Excluding operations in the automotive sector,
statutory operating profit was down 3%. Higher storage and handling costs and
IPEP expense impacted profit, partially offset by the benefits of restructuring
undertaken in the 2009 financial year.
Cash flow
Cash flow improvements were mainly a result of lower capital expenditure.
CHEP Asia-Pacific
+----------------------------+--------+--------+---------+-----------+
| Table 6 |
+--------------------------------------------------------------------+
| CHEP Asia-Pacific |
+--------------------------------------------------------------------+
| US$ million | 1H10 | 1H09 | % | % |
| | | | change | change |
| | | | (actual | (constant |
| | | | FX | currency) |
| | | | rates) | |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Sales revenue | 195.0 | 166.6 | 17% | 4% |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Statutory operating profit | 32.5 | 28.4 | 14% | (6)% |
+----------------------------+--------+--------+---------+-----------+
| Statutory operating profit | 17% | 17% | - | (1)pp |
| margin | | | | |
+----------------------------+--------+--------+---------+-----------+
| Significant items: | | | | |
+----------------------------+--------+--------+---------+-----------+
| Restructuring - facilities | - | 0.5 | | |
| and operations | | | | |
| rationalisation | | | | |
+----------------------------+--------+--------+---------+-----------+
| Underlying profit | 32.5 | 28.9 | 12% | (7)% |
+----------------------------+--------+--------+---------+-----------+
| Underlying profit margin | 17% | 17% | - | (1)pp |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Cash flow from operations | 35.7 | (22.8) | | |
+----------------------------+--------+--------+---------+-----------+
| |
+----------------------------+--------+--------+---------+-----------+
Sales
CHEP Asia-Pacific delivered sales revenue growth of 4% to US$195.0 million. CHEP
Australia offset the impact of a weak automotive sector and lower pallet hire
balances from supply chain destocking with greater diversification of its
revenue streams, notably through growth in RPCs and plastic display pallets.
Excluding the Australian automotive sector, sales revenue growth was 6%.
China and India's combined sales revenue was double that of the prior
corresponding period at US$6.4 million, reflecting growth in pallet volumes and
container services in the Chinese automotive sector. Sales revenue in New
Zealand and South-East Asia also grew in the period.
Profit
Statutory operating profit was 6% lower and Underlying profit was down 7% to
US$32.5 million. Impacts on profit included: the subdued conditions in the
Australian automotive sector; depreciation expense from new platform equipment
and pooling assets purchased in the 2009 financial year; and lower pallet hire
balances. Excluding the Australian automotive business, statutory operating
profit was in line with the prior corresponding period.
Cash flow
The strong improvement in cash flow reflected a US$35.0 million reduction in
capital expenditure, combined with working capital efficiencies and positive
foreign exchange impacts. In the prior corresponding period, cash flow was
impacted by capital expenditure relating to the commencement of a RPC contract
in Australia and customer growth in China.
End of page 7 of 14
Recall
+----------------------------+--------+--------+---------+-----------+
| Table 7 |
+--------------------------------------------------------------------+
| Recall |
+--------------------------------------------------------------------+
| US$ million | 1H10 | 1H09 | % | % |
| | | | change | change |
| | | | (actual | (constant |
| | | | FX | currency) |
| | | | rates) | |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Sales revenue | 364.1 | 353.1 | 3% | (1)% |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Statutory operating profit | 52.5 | 49.5 | 6% | - |
+----------------------------+--------+--------+---------+-----------+
| Statutory operating profit | 14% | 14% | - | - |
| margin | | | | |
+----------------------------+--------+--------+---------+-----------+
| Significant items: | | | | |
+----------------------------+--------+--------+---------+-----------+
| Restructuring - facilities | - | 1.0 | | |
| and operations | | | | |
| rationalisation | | | | |
+----------------------------+--------+--------+---------+-----------+
| Underlying profit | 52.5 | 50.5 | 4% | (2)% |
+----------------------------+--------+--------+---------+-----------+
| Underlying profit margin | 14% | 14% | - | - |
+----------------------------+--------+--------+---------+-----------+
| | | | | |
+----------------------------+--------+--------+---------+-----------+
| Cash flow from operations | 45.9 | 22.0 | | |
+----------------------------+--------+--------+---------+-----------+
| |
+----------------------------+--------+--------+---------+-----------+
Sales
Recall's sales revenue was 1% lower at US$364.1 million, reflecting lower paper
prices and volumes in the SDS service line. Carton volumes in the DMS service
line rose 5%. Net new business wins contributed sales revenue growth of 3%.
Excluding SDS, Recall's sales revenue was up 4%
Profit
Statutory operating profit was in line with the prior corresponding period at
US$52.5 million. Underlying profit was down 2%. Excluding SDS, statutory
operating profit rose 16%, reflecting the benefits of restructuring Recall
undertook during the 2009 financial year and an ongoing focus on cost
efficiencies.
Cash flow
The increase in cash flow was largely a result of working capital efficiencies.
Safety
Brambles' safety performance continued to improve in the six-month period. The
12-month rolling Brambles Injury Frequency Rate (BIFR) was 21.8 per million man
hours at 31 December 2009, compared with 23.1 per million man hours at 30 June
2009. Injury frequency and severity reduced, reflecting Brambles' ongoing
commitment to pursuing Zero Harm.
End of page 8 of 14
Additional financial information
Capital expenditure (property, plant and equipment) and cash flow
+--------------------------------------+-------+--------+--------+
| Table 8 |
+----------------------------------------------------------------+
| Capital expenditure on property, plant and equipment (accruals |
| basis) |
+----------------------------------------------------------------+
| US$ million | 1H10 | 1H09 | Change |
+--------------------------------------+-------+--------+--------+
| | | | |
+--------------------------------------+-------+--------+--------+
| CHEP Americas | 101.7 | 156.7 | 55.0 |
+--------------------------------------+-------+--------+--------+
| CHEP EMEA | 84.7 | 136.0 | 51.3 |
+--------------------------------------+-------+--------+--------+
| CHEP Asia-Pacific | 27.9 | 62.9 | 35.0 |
+--------------------------------------+-------+--------+--------+
| Total CHEP | 214.3 | 355.6 | 141.3 |
+--------------------------------------+-------+--------+--------+
| Recall | 18.1 | 21.1 | 3.0 |
+--------------------------------------+-------+--------+--------+
| Brambles HQ | 0.1 | 0.3 | 0.2 |
+--------------------------------------+-------+--------+--------+
| Total capital expenditure | 232.5 | 377.0 | 144.5 |
+--------------------------------------+-------+--------+--------+
| | | | |
+--------------------------------------+-------+--------+--------+
+--------------------------------------+---------+---------+---------+
| Table 9 |
+--------------------------------------------------------------------+
| Cash flow |
+--------------------------------------------------------------------+
| US$ million | 1H10 | 1H09 | Change |
+--------------------------------------+---------+---------+---------+
| Continuing operations | | | |
+--------------------------------------+---------+---------+---------+
| Underlying profit | 340.2 | 469.3 | (129.1) |
+--------------------------------------+---------+---------+---------+
| Significant items within ordinary | - | (54.7) | 54.7 |
| activities | | | |
+--------------------------------------+---------+---------+---------+
| Depreciation & amortisation | 221.9 | 212.8 | 9.1 |
+--------------------------------------+---------+---------+---------+
| EBITDA | 562.1 | 627.4 | (65.3) |
+--------------------------------------+---------+---------+---------+
| Capital expenditure (cash basis) | (254.6) | (400.1) | 145.5 |
+--------------------------------------+---------+---------+---------+
| Proceeds from disposals | 43.6 | 41.2 | 2.4 |
+--------------------------------------+---------+---------+---------+
| Working capital movement | (21.4) | (65.5) | 44.1 |
+--------------------------------------+---------+---------+---------+
| Irrecoverable pooling equipment | 60.2 | 36.5 | 23.7 |
| provision | | | |
+--------------------------------------+---------+---------+---------+
| Provisions / Other | 10.4 | (18.7) | 29.1 |
+--------------------------------------+---------+---------+---------+
| Cash flow from operations | 400.3 | 220.8 | 179.5 |
+--------------------------------------+---------+---------+---------+
| Significant items outside ordinary | (35.1) | (21.7) | (13.4) |
| activities | | | |
+--------------------------------------+---------+---------+---------+
| Cash flow from operations (incl. | 365.2 | 199.1 | 166.1 |
| Significant items) | | | |
+--------------------------------------+---------+---------+---------+
| Financing costs and tax | (130.6) | (126.5) | (4.1) |
+--------------------------------------+---------+---------+---------+
| Free cash flow | 234.6 | 72.6 | 162.0 |
+--------------------------------------+---------+---------+---------+
| Dividends paid | (101.3) | (163.2) | 61.9 |
+--------------------------------------+---------+---------+---------+
| Free cash flow after dividends | 133.3 | (90.6) | 223.9 |
+--------------------------------------+---------+---------+---------+
| | | | |
+--------------------------------------+---------+---------+---------+
Brambles' reduction in capital expenditure of US$144.5 million5 was driven
predominantly by reduced requirements for new pallets in CHEP. The reduction
also reflected investment in new service centres and a RPC contract in Australia
in the prior corresponding period. Total pallet capital expenditure was US$170.9
million, compared with US$274.0 million in the prior corresponding period.
Capital expenditure within Recall supported growth and expansion in security
infrastructure.
Cash flow improved as savings in capital expenditure more than offset the
reduction in EBITDA.
Significant items included spend for facilities and operations rationalisation
and the accelerated scrapping of excess pallets in CHEP USA, which was provided
for in the prior financial year.
5 Capital expenditure quoted on an accruals basis. On a cash basis, the
reduction was US$145.5 million.
End of page 9 of 14
Interest
Net finance costs were US$54.0 million compared with US$63.7 million in the
prior corresponding period. The reduction in net finance costs reflected lower
interest rates on variable rate borrowings and lower average borrowings compared
with the prior period. These benefits were partially offset by higher borrowing
margins and fees on debt refinanced during the 2009 financial year.
Tax
The effective tax rate (ETR) applying to both statutory operating profit and
Underlying profit was 27.2%. In the prior corresponding period, the ETR was
28.7% for statutory operating profit and 33.3% for Underlying profit. The
reduction in the ETR was mainly a result of a net reversal of tax provisions
following the receipt of a tax ruling, and lower profits in the USA.
Brambles Value Added
Brambles Value Added was US$71.0 million in the period, down US$80.4 million on
the prior corresponding period, reflecting the reduction in profit from ordinary
activities.
Debt
+-----------------------------+-----------+-----------+-----------+
| Table 10 |
+-----------------------------------------------------------------+
| Net debt and key ratios |
+-----------------------------------------------------------------+
| US$ million | December | June 2009 | Change |
| | 2009 | | |
+-----------------------------+-----------+-----------+-----------+
| | | | |
+-----------------------------+-----------+-----------+-----------+
| Current debt | 66.4 | 68.0 | 1.6 |
+-----------------------------+-----------+-----------+-----------+
| Non-current debt | 2,079.9 | 2,165.5 | 85.6 |
+-----------------------------+-----------+-----------+-----------+
| Gross debt | 2,146.3 | 2,233.5 | 87.2 |
+-----------------------------+-----------+-----------+-----------+
| Less cash | (117.9) | (90.1) | 27.8 |
+-----------------------------+-----------+-----------+-----------+
| Net debt | 2,028.4 | 2,143.4 | 115.0 |
+-----------------------------+-----------+-----------+-----------+
| | | | |
+-----------------------------+-----------+-----------+-----------+
| | 1H10 | 1H09 | Change |
+-----------------------------+-----------+-----------+-----------+
| EBITDA | 562.1 | 627.4 | (65.3) |
+-----------------------------+-----------+-----------+-----------+
| Net finance costs | 54.0 | 63.7 | 9.7 |
+-----------------------------+-----------+-----------+-----------+
| Key ratios | | | |
+-----------------------------+-----------+-----------+-----------+
| Net debt to EBITDA | 1.8x | 1.9x | 0.1x |
+-----------------------------+-----------+-----------+-----------+
| EBITDA interest cover | 10.4x | 9.8x | 0.6x |
+-----------------------------+-----------+-----------+-----------+
Net debt at 31 December 2009 was US$2,028.4 million, down US$115.0 million from
30 June 2009 as a result of positive cash generation after dividends. At 31
December 2009, committed credit facilities, including US$535.0 million of US
private placement notes, totalled US$3,425.5 million, of which US$567.4 million
is due to expire in the next 12 months. Undrawn committed credit facilities
totalled US$1,317.2 million, while cash balances stood at US$117.9 million.
Investment grade credit ratings of BBB+ (stable outlook) from Standard & Poor's
and Baa1 (stable outlook) from Moody's Investor Services were issued in December
2009. These ratings reaffirm the underlying strength of Brambles' business and
will provide the company with additional financial flexibility in accessing debt
funding.
The ratio of net debt to EBITDA for the period was 1.8 times and EBITDA interest
cover was 10.4 times.
End of page 10 of 14
Foreign exchange rates
The principal foreign exchange rates affecting Brambles were:
+---------+-------------+-------------+-------------+-------------+
| | US$:A$ | US$:EUR | US$:GBP |
+-----------------------+-------------+-------------+-------------+
| Average | First half | 0.8765 | 1.4570 | 1.6328 |
| | 2010 | 0.7759 | 1.4180 | 1.7166 |
| | First half | | | |
| | 2009 | | | |
+---------+-------------+-------------+-------------+-------------+
| Period | 31 December | 0.8987 | 1.4416 | 1.6129 |
| end | 2009 | 0.8114 | 1.4106 | 1.6637 |
| | 30 June | | | |
| | 2009 | | | |
+---------+-------------+-------------+-------------+-------------+
Dividend
+---------+----------+----------+----------+----------+----------+
| | Aust. | Franking | Ex | Record | Payment |
| | cents | | dividend | date | date |
| | per | | trading | | |
| | share | | date | | |
+---------+----------+----------+----------+----------+----------+
| Interim | 12.5 | 20% | 12 March | 18 March | 8 April |
| | | | 2010 | 2010 | 2010 |
+---------+----------+----------+----------+----------+----------+
The unfranked component of the interim dividend is conduit foreign income.
Consequently, no Australian dividend withholding tax will be payable on the
interim dividend to be paid to Brambles' non-resident shareholders.
Dividend Reinvestment Plan
The Board has set the price at which shares will be allotted under Brambles'
Dividend Reinvestment Plan (DRP) for the interim dividend as the arithmetic
average of the daily volume-weighted average sale price of all Brambles shares
sold on the Australian Securities Exchange (ASX) in the ordinary course of
trading during the 10 trading days starting 22 March 2010, less a discount of
2.5%. The record date is the latest date on which an eligible shareholder can
elect to participate or increase their participation in the DRP.
Forward-looking statements
Certain statements made in this release are forward-looking statements. These
forward-looking statements are not historical facts but rather are based on
Brambles' current expectations, estimates and projections about the industry in
which Brambles operates, and beliefs and assumptions. Words such as
"anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates,"
and similar expressions are intended to identify forward-looking statements.
These statements are not guarantees of future performance and are subject to
known and unknown risks, uncertainties and other factors, some of which are
beyond the control of Brambles, are difficult to predict and could cause actual
results to differ materially from those expressed or forecasted in the
forward-looking statements. Brambles cautions shareholders and prospective
shareholders not to place undue reliance on these forward-looking statements,
which reflect the view of Brambles only as of the date of this release. The
forward-looking statements made in this release relate only to events as of the
date on which the statements are made. Brambles will not undertake any
obligation to release publicly any revisions or updates to these forward-looking
statements to reflect events, circumstances or unanticipated events occurring
after the date of this release except as required by law or by any appropriate
regulatory authority.
End of page 11 of 14
Background information
+--------------------------------+-----------+---+-----------+-----------+-----------+
| US$ million | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Actual fx rates | 1H10 | | 1H09 | 2H09 | FY09 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Sales | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Americas | 756.9 | | 792.5 | 764.4 | 1,556.9 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP EMEA | 770.1 | | 761.0 | 691.6 | 1,452.6 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Asia-Pacific | 195.0 | | 166.6 | 156.8 | 323.4 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total CHEP | 1,722.0 | | 1,720.1 | 1,612.8 | 3,332.9 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Recall | 364.1 | | 353.1 | 332.6 | 685.7 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total Brambles | 2,086.1 | | 2,073.2 | 1,945.4 | 4,018.6 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Underlying profit | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Americas | 108.6 | | 233.3 | 201.1 | 434.4 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP EMEA | 161.4 | | 170.9 | 156.6 | 327.5 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Asia-Pacific | 32.5 | | 28.9 | 32.2 | 61.1 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total CHEP | 302.5 | | 433.1 | 389.9 | 823.0 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Recall | 52.5 | | 50.5 | 53.8 | 104.3 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total Brambles (including HQ) | 340.2 | | 469.3 | 431.3 | 900.6 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Underlying profit margin | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Americas | 14% | | 29% | 26% | 28% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP EMEA | 21% | | 22% | 23% | 23% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Asia-Pacific | 17% | | 17% | 21% | 19% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total CHEP | 18% | | 25% | 24% | 25% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Recall | 14% | | 14% | 16% | 15% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total Brambles (including HQ) | 16% | | 23% | 22% | 22% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Statutory operating profit | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Americas | 108.6 | | 79.6 | 149.4 | 229.0 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP EMEA | 159.3 | | 166.2 | 120.3 | 286.5 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Asia-Pacific | 32.5 | | 28.4 | 29.5 | 57.9 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total CHEP | 300.4 | | 274.2 | 299.2 | 573.4 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Recall | 52.5 | | 49.5 | 46.4 | 95.9 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total Brambles (including HQ) | 338.1 | | 337.6 | 380.6 | 718.2 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Average capital invested | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Americas | 1,748.2 | | 1,625.5 | 1,707.9 | 1,666.7 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP EMEA | 1,505.8 | | 1,493.9 | 1,402.9 | 1,448.4 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Asia-Pacific | 381.9 | | 314.6 | 323.6 | 319.1 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total CHEP | 3,635.9 | | 3,434.0 | 3,434.4 | 3,434.2 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Recall | 947.0 | | 925.6 | 869.0 | 897.3 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total Brambles (including HQ) | 4,522.0 | | 4,293.2 | 4,244.2 | 4,268.7 |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Return on capital invested | | | | | |
| (annualised) | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| (based on Underlying profit) | | | | | |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Americas | 12% | | 29% | 24% | 26% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP EMEA | 21% | | 23% | 22% | 23% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| CHEP Asia-Pacific | 17% | | 18% | 20% | 19% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total CHEP | 17% | | 25% | 23% | 24% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Recall | 11% | | 11% | 12% | 12% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
| Total Brambles (including HQ) | 15% | | 22% | 20% | 21% |
+--------------------------------+-----------+---+-----------+-----------+-----------+
End of page 12 of 14
Background information (continued)
+--------------------------------+------------------+---+------------------+---------+------------------+
| US$ million | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Actual fx rates | 1H10 | | 1H09 | 2H09 | FY09 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Cash flow from operations | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Americas | 139.8 | | 116.9 | 150.1 | 267.0 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP EMEA | 202.7 | | 137.1 | 235.6 | 372.7 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Asia-Pacific | 35.7 | | (22.8) | 32.6 | 9.8 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Total CHEP | 378.2 | | 231.2 | 418.3 | 649.5 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Recall | 45.9 | | 22.0 | 84.9 | 106.9 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Total Brambles (including HQ) | 400.3 | | 220.8 | 501.6 | 722.4 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Capital expenditure on | | | | | |
| property, | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| plant & equipment (accruals | | | | | |
| basis) | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Americas | 101.7 | | 156.7 | 134.1 | 290.8 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP EMEA | 84.7 | | 136.0 | 98.4 | 234.4 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Asia-Pacific | 27.9 | | 62.9 | 29.8 | 92.7 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Total CHEP | 214.3 | | 355.6 | 262.3 | 617.9 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Recall | 18.1 | | 21.1 | 31.3 | 52.4 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Total Brambles (including HQ) | 232.5 | | 377.0 | 295.4 | 672.4 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Depreciation of | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| property, plant & equipment | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Americas | 79.3 | | 82.9 | 79.5 | 162.4 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP EMEA | 83.9 | | 83.2 | 78.2 | 161.4 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Asia-Pacific | 24.7 | | 17.1 | 18.1 | 35.2 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Total CHEP | 187.9 | | 183.2 | 175.8 | 359.0 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Recall | 16.9 | | 16.2 | 16.0 | 32.2 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Total Brambles (including HQ) | 205.0 | | 199.5 | 191.8 | 391.3 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Capex/depreciation ratio | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Americas | 1.3x | | 1.9x | 1.7x | 1.8x |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP EMEA | 1.0x | | 1.6x | 1.3x | 1.5x |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Asia-Pacific | 1.1x | | 3.7x | 1.6x | 2.6x |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Total CHEP | 1.1x | | 1.9x | 1.5x | 1.7x |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Recall | 1.1x | | 1.3x | 2.0x | 1.6x |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Total Brambles (including HQ) | 1.1x | | 1.9x | 1.5x | 1.7x |
+--------------------------------+------------------+---+------------------+---------+------------------+
| | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Pallet numbers (millions) 1 | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Americas | 99 | | 104 | | 103 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP EMEA | 129 | | 136 | | 130 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Asia-Pacific | 18 | | 18 | | 18 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Total CHEP | 246 | | 258 | | 251 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Carton numbers - Recall | 91 | | 86 | | 88 |
| (millions) | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| BVA 2 | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Americas | 9.4 | | 83.1 | 55.4 | 138.5 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP EMEA | 69.9 | | 82.5 | 77.3 | 159.8 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| CHEP Asia-Pacific | 7.8 | | 11.3 | 14.9 | 26.2 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Total CHEP | 87.1 | | 176.9 | 147.6 | 324.5 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Recall | (6.5) | | (7.1) | 0.7 | (6.4) |
+--------------------------------+------------------+---+------------------+---------+------------------+
| Total Brambles (including HQ) | 71.0 | | 151.4 | 131.6 | 283.0 |
+--------------------------------+------------------+---+------------------+---------+------------------+
| | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| 1 Shown gross, before | | | | | |
| provisions | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
| 2 At fixed June 2009 exchange | | | | | |
| rates | | | | | |
+--------------------------------+------------------+---+------------------+---------+------------------+
End of page 13 of 14
Glossary
Actual rates
In the statutory financial statements, foreign currency results are translated
into US dollars at the applicable actual monthly exchange rates ruling in each
period.
Average Capital Invested
Average Capital Invested (ACI) is a 12-month average of capital
invested. Semi-annual average capital invested calculated as a 6 month average.
Capital Invested is calculated as net assets before tax balances, cash and
borrowings, but after adjustment for accumulated pre-tax Significant items,
actuarial gains or losses and net equity adjustments for equity-settled
share-based payments.
BIFR
Brambles Injury Frequency Rate (BIFR) is the sum of the total number of
fatalities, lost-time injuries, modified duties and medical treatments,
calculated on a per million hours worked basis.
BVA
Brambles Value Added (BVA) represents the value generated over and above the
cost of the capital used to generate that value. It is calculated using fixed
June 2009 exchange rates as:
· Underlying profit; plus
· Significant items that are part of the ordinary activities of the
business; less
· Average Capital Invested, adjusted for accumulated pre-tax Significant
items that are part of the ordinary activities of the business, multiplied by
12%.
Capital expenditure
Unless otherwise stated, capital expenditure is presented on an accruals basis
and excludes intangible assets, investments in associates and equity
acquisitions. It is shown gross of any fixed asset disposals proceeds.
Cash flow from operations
Cash flow generated after net capital expenditure but excluding Significant
items that are outside the ordinary course of business.
Constant currency
In the commentary, constant currency results are presented by translating both
current and comparable period foreign currency results into US dollars at the
actual monthly exchange rates applicable in the comparable period, so as to show
relative performance between the two periods before the translation impact of
currency fluctuations.
Continuing operations
Continuing operations refers to CHEP, Recall and Brambles HQ.
Free cash flow
Cash flow generated after net capital expenditure, finance costs and tax, but
excluding the net cost of acquisitions and proceeds from business disposals.
ROCI
Return on Capital Invested or ROCI is calculated as Underlying profit divided by
Average Capital Invested.
Significant items
Significant items are items of income or expense which are, either individually
or in aggregate, material to Brambles or to the relevant business segment and:
· outside the ordinary course of business (for example, gains or losses on
the sale or termination of operations, the cost of significant reorganisations
or restructuring); or
· part of the ordinary activities of the business but unusual due to their
size and nature.
Underlying profit
Underlying profit is profit from continuing operations before finance costs, tax
and Significant items.
End of page 14 of 14
This information is provided by RNS
The company news service from the London Stock Exchange
END
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