Which are the biggest freight & logistics stocks on the NZX?

Summary

  • Freight and logistic companies manage the movement of goods within and outside the country
  • COVID-19 impacted some of these mid-cap freight & logistics companies adversely
  • With economic recovery these companies are performing better than before

Freight and logistics companies manage the movement of goods from one place to another. They include everything from technology, human experience, and knowledge to facilitate effective and efficient transportation of goods on time.

Logistics companies, unlike freight forwarders, own their assets, including fleets of trucks, boats, or planes, but without any access to actual shipping routes. These companies often specialise in specific areas such as dry box, long haul, cold storage, intracity, or large scale. Freight companies, on the other hand, facilitate goods transported in bulk by truck, train, ship, and aircraft.

The Freight and logistics sector in New Zealand was impacted by COVID-19-related border closures. With lockdowns and other announcements, a large-scale impact was felt on the freight industry. Freight was affected in many ways due to delays in delivery, less or no movement, and closed international channels. Logistics companies, however, did well as due to increase in online shopping warehousing and logistics, it assumed importance.

Let’ see which are the biggest related stocks and also to what extent were these companies impacted by COVID-19 disruptions.

Mainfreight Limited (NZX:MFT)

The company was set up in 1978 and listed on the NZX in June 1978.

It is a company that specialises in freight forwarding with stake in warehousing, transportation of hazardous substances, air and ocean international freight, and global supply chain logistics.  It is based in Auckland and its business segments include - domestic transportation and managed warehousing in NZ, Australia, the USA, and Europe, and air & ocean international transportation in NZ, Australia, the USA, Europe, and Asia with agents world-wide and wholesale air and ocean freight.

The company has grown through several acquisitions and mergers but the biggest acquisition was that of European Wim Bosman Group at NZ$110M. In 2020, it had 282 branches and 8,631 employees. But in its annual report released on 25 May 2021, it reported an operating revenue of NZ$3.54B up 14.5%, employees 9,240 up 609, and EBIT at 262.4, up 27%.

On 7 July 2021, at the time of writing, MFT stock was at NZ$77.450, down by 1.78%.

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Also Read: Why are these 6 NZX stocks creating a buzz today? TWR, AMP, KFL, BRM, MFT, SKC

Freightways Limited (NZX:FRE)

FRE was listed on the NZX in September 2003. The business comprises courier services nationally, mail box delivery, management services, and Stocklink - distribution, records management and document destruction services.

FRE did several acquisitions to expand its operations and today it is in Express package, business mail, and information management businesses.

During COVID-19-related lockdowns and border closures, the Company saw a sharp drop in its revenues in the first half of CY2020. However, by the end of the year, it improved volumes of express packages. By 1QFY21, it picked up momentum and grew by 35% in its total revenue. Its NPAT was at NZ$19.2M, up 43% pcp. The information management business, however, remained impacted due to the COVID-19 pandemic. In the first half of HY21, it reported strong results. Its information management system was reported to be getting back on track and document destruction services also recovered to pre-COVID-19 levels.

Also Read: 4 NZX Industrial Stocks You Can’t Ignore Easily - RAK, SCT, SKL, FRE

On 7 July 2021, the stock was trading down by 0.77% at NZ$13, at the time of writing.

© Binkski | Megapixl.com

TIL Logistics Group Limited (NZX:TLL)

TIL joined the NZX on 7 December 2017. TIL is also a large domestic freight and logistics company. Its businesses include transporting and warehousing freight in New Zealand and also coordinating freight movements through international partnerships. It also operates a road tanker division, which delivers fuel to various NZ locations.

Also Read: Are These 5 Small-Cap NZX Stocks Suitable For Long-Term Investment?

TIL Logistics reported a better trading in majority of its divisions in 1HFY21. It reported an increase in group earnings and profits in the period ending 31 December 2021. The Group expects full-year performance to be strong with an EBIT of at least NZ$57.4M.

On 7 July 2021, at the time of writing, TLL was trading at NZ$1.250, down 1.57%.

QEX Logistics Limited (NZX:QEX)

QEX Logistics Limited announced delisting from the NZX recently. Trading in the stock was also suspended due to non-compliance with the NZX rules relating to its board composition. QEX specialises in the delivery of goods bought in NZ and Australia for online stores that cater to Chinese consumers.

QEX suffered significant disruptions due to COVID-19 pandemic resulting in reduction in NZ and Australian diagou sales channels. The Company has been making a loss, and for the 6 months ended September 2020, it reported a loss after tax of NZ$5.9M, a major part of which is inventory loss.

Also Read: 5 Small-cap NZX Stocks To Keep an Eye on In Q2 2021

Also Read: Sailing through rough seas: A peek into NZX-listed logistics stocks - TIL, QEX

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