CTI LOGISTICS LIMITED — Annual Report 2013

Sep 12, 2013

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Security & Manufacturing

Logistics

Transport

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CTI Logistics Limited 2013 Performance Review

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Overview

• CTI Logistics Limited (CTI) is a provider of transport, logistics and security services to the Western Australian market

• CTI has been a publicly listed company since 1987 with its transport and logistics origins dating back to 1974

• CTI services in excess of 5,500 customers ranging from small local businesses through to ASX 100 companies

• CTI has more than 670 vehicles on the road ranging from courier vehicles through to triple road train combinations

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Principal Activities

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Transport Logistics Supply Chain Logistics Other
 On Demand Couriers Warehousing and Distribution Security
 Parcel Distribution  Third Party Overflow Warehousing  Installation and servicing of monitored
 On Demand Taxi Trucks  Contracted Distribution Centre Services alarms for residential and commercial
market
 Dedicated Fleet Management  Pick and Pack Handling
 Installation and servicing of CCTV and
 Container Transport  Bulk Product Storage
access control products for residential
 Heavy Haulage Minerals and Energy Logistics and commercial market
 Intrastate Road Freight  Supply Base warehousing and asset  24/7 Control room monitoring of alarms
for own clients and third party security
Freight Forwarding management
businesses
 Interstate Freight Forwarding  Labour hire
 International Freight Forwarding  Plant and Equipment Hire Document Storage and Destruction
 Quarantine equipment cleaning and  Secure storage of confidential
fumigation documents and computer media
 Plant and Equipment preservation  Cataloguing of documents
shrink wrapping  Supervised destruction of confidential
Temperature Controlled Storage documents and computer media
and Distribution
Manufacturing
 Wine Storage and stock management
 Manufacturing of PVC injection moulded
 Food Product Storage
plumbing fittings
 Temperature controlled delivery
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Corporate Information	as of 10/9/2013
ASX Code	CLX
Shares on Issue	64.8M
Options on Issue	Nil
Share Price @ 10/9/2013	$2.00
Market Capitalisation	$129.6M

Movement in Share Capital	Movement	Total
At 30 June 2007		34.2M
December 2008 - 1 for 5 Bonus	6.8M	41.0M
December 2010 - 1 for 5 Bonus	8.2M	49.2M
December 2011 - ESP	1.1M	50.3M
June 2012 - 1 for 5 Bonus	10.0M	60.3M
February 2013 - ESP	0.3M	60.6M
May 2013 – DRP, BSP & share issue	1.1M	61.7M
August 2013 – Placement	3.1M	64.8M

Corporate Dashboard

5 Year Chart

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• Placement August 2013 - $5,671,767 raised by placement of 3,065,820 shares at issue price of $1.85 cents per share to institutional investors

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2013 Financial Year Operational Highlights

• Completed stage one of new Hazelmere warehousing and distribution facility (March 2013) which is now generating positive returns

• Acquired Bunbury Freight Services (servicing the South West of Western Australia) to augment the development of our regional transport network

• Established CTI Freightlines (servicing the North West of Western Australia) and Broome Freightlines to augment the development of our regional transport network and support our growing minerals and energy operations

• Gained accreditation from Bechtel to provide transport and logistical services to Chevron Wheatstone LNG project

• Entered into agreement to represent New Zealand Post owned Couriers Please (national parcel network) in Western Australia

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2013 Financial Year New Business Highlights

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Secured dedicated fleet management contract with Adelaide Brighton (Cockburn and Swan Cement)

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Secured contract extension and additional warehousing and distribution work for Target

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Secured warehousing and distribution contract for Nufarm Chemicals

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Secured logistics contract with CB&I – Kentz Joint Venture to provide quarantine wrapping and logistical services to support their Chevron Gorgon LNG contract

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Secured transport labour contract with Dredging International to support their Chevron Wheatstone LNG contract

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Secured transport and logistical services for EVT Joint Venture (Thiess and EV LNG Australia) to support their Chevron Wheatstone LNG contract

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Secured warehousing relocation project at Mount Whaleback for BHP Iron Ore division

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Key Financials CTI Group*

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Revenue

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2013 2012 Change
150,000,000 126.7
96.8
100,000,000 72.5 Revenue $126,668,709 $96,751,645 30.9%
50,000,000
0 EBITDA $18,897,943 $14,716,937 28.4%
2011 2012 2013
NPAT $9,823,494 $7,332,490 34.0%
EBITDA
18.9 EPS (Basic) 16.56 12.40 33.5%
20,000,000 12.2 14.7
10,000,000
0 EPS (Diluted) 16.46 12.36 33.2%
2011 2012 2013
DPS (2H) 0.04 0.035 14.3%
Net Profit After Tax
DPS (FY) 0.075 0.065 15.4%
15,000,000
9.8
10,000,000 7.3
6.2 ROIC 13.2% 14.6% -0.1%
5,000,000
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15,000,000
9.8
10,000,000 7.3
6.2
5,000,000
0
2011 2012 2013
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*The CTI Group key financials includes unallocated amounts not included in segments

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Revenue

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80,000,000 73.0
62.2
60,000,000 47.3
40,000,000
20,000,000
0
2011 2012 2013
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EBITDA

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15,000,000
10.2
10,000,000 7.2 8.6
5,000,000
0
2011 2012 2013
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Net Profit After Tax

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8,000,000
6.1
6,000,000 5.0
4.5
4,000,000
2,000,000
0
2011 2012 2013
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Key Financials Transport Segment

• Revenue has grown from $62,237,809 to $73,033,054, a 17.3% increase

• EBITDA has grown from $8,580,021 to $10,167,782, a 18.5% increase

• NPAT has grown from $5,072,364 to $6,102,733, a 20.3% increase

• Major drivers have been growth in minerals and energy sector and fleet management work

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Revenue

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60,000,000
41.9
40,000,000
23.2
20,000,000 13.3
0
2011 2012 2013
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EBITDA

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10,000,000
6.7
5,000,000 3.9
2.1
0
2011 2012 2013
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Net Profit After Tax

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6,000,000
4.2
4,000,000
2.3
2,000,000 1.1
0
2011 2012 2013
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Key Financials Logistics Segment

• Revenue has grown from $23,236,537 to $ 41,877,478, a 80.2% increase

• EBITDA has grown from $3,888,976 to $6,681,279, a 71.8% increase

• NPAT has grown from $2,265,518 to $4,177,261, a 84.4% increase

• Major driver has been growth of minerals and energy sector work

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Revenue

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15,000,000
11.2 11.0
10.5
10,000,000
5,000,000
0
2011 2012 2013
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EBITDA

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6,000,000
4.0 3.9 3.9
4,000,000
2,000,000
0
2011 2012 2013
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Net Profit After Tax

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2,000,000 1.6 1.5
1.3
1,000,000
0
2011 2012 2013
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Key Financials Property & Other (includes Security and Manufacturing)

• Revenue has grown from $10,506,881 to $11,003,040, a 4.7% increase.

• EBITDA has grown from $3,884,713 to $3,917,187, a 0.8% increase.

• NPAT has declined from $1,463,749 to $1,313,522 , a 10.3% decrease.

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Business Sector Snapshot

• On Demand Couriers and Taxi Trucks  tough market conditions which is putting pressure on rates

• Parcel Distribution  expecting further growth with rationalisation of competitors in the Western Australian market and growth of online deliveries

• Heavy Transport  has benefited from the ramp up of minerals and energy sector work

• Freight Services  growing as we roll out regional transport network

• Warehousing and distribution  solid performance with positive outlook for growth

• Minerals and Energy Logistics  continues to gain business for Chevron Gorgon project and now making traction with contractors to Chevron Wheatstone project

• Document Storage and Destruction  steady growth off a small base with destruction services leading the way

• Security  residential market steady - growth coming from commercial market with the improvement of CCTV technology

• Plastics  very competitive market conditions

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Balance Sheet

	Jun-13 Jun-12
ASSETS Current assets
Cash and cash equivalents	4,440,952 1,407,492
Trade and other receivables	21,604,640 17,354,887
Inventories	2,633,659 2,733,503
Total current assets	28,679,251 21,495,882
Non-current assets
Other receivables	- 39,600
Available-for-sale financial assets	71,000 62,877
Property, plant and equipment*	56,449,648 35,714,360
Investment properties	9,781,361 9,889,986
Deferred tax assets	992,517 922,675
Intangible assets	5,878,074 4,826,909
Total non-current assets	73,172,600 51,456,407
Total assets	101,851,851 72,952,289
LIABILITIES Current liabilities
Trade and other payables	14,016,490 8,275,330
Borrowings	1,965,520 1,812
Current tax liabilities	1,163,873 1,236,017
Provisions	2,609,084 2,167,592
Total current liabilities	19,754,967 11,680,751
Non-current liabilities
Borrowings	35,100,966 22,600,000
Provisions	589,463 472,722
Total non-current liabilities	35,690,429 23,072,722
Total liabilities	55,445,396 34,753,473
Net assets	46,406,455 38,198,816
NTA per share	$0.67 $0.56
Net debt-to-equity ratio	70.3% 55.5%
Interest cover	14.5 12.9
* Freehold Land & Buildings at cost (30 June 2013)	$45,966,630
*Freehold Land & Buildings at Directors valuation (30 June 2013)	$78,723,273

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Outlook 2014 Financial Year Initiatives

• Develop stage two of Hazelmere warehousing and distribution facility for growth requirements of existing contract warehousing clients

• Expand general warehousing footprint

• Continue the development of a regional transport network

• Continue to target transport and logistics opportunities for Chevron Gorgon and Wheatstone projects

• Enhance service platform for home delivery and online sales

• Look for organic growth and growth by acquisitions that complement our existing range of services

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