Forklift News - Barloworld faces challenging conditions

Barloworld faced challenging trading conditions in its international operations for the first six months of financial year 2009, and the South African forklift market also declined from last year.

Clive Thomson, Barloworld CEO, says the overall trading environment in the second half of financial year 2009 is expected to remain difficult: "In these circumstances, we will retain our focus on expense and working capital management and our various initiatives should result in strong cash flow for the year."

Barloworld’s revenue for the first six months increased 6% to ZAR22.5 billion (USD2.7 billion) from the previous year’s ZAR21.18 billion (USD2.5 billion), while the group’s net profit decreased 59.6% from ZAR1 billion (USD118.4 million) to ZAR420 million (USD49.5 million).

Barloworld reports this week that in the handling division, the agriculture business continued to perform well. While the US and UK handling businesses remain under pressure as both economies are still depressed, Barloworld grew marketshare in the US and maintained its share in the UK. Markets in Belgium and the Netherlands are "significantly down" on last year.

The logistics division generated significantly higher revenue after the acquisition of Dubai-based Swift group and the Flynt operations in Hong Kong, the report says (Forkliftaction.com News #355).

Barloworld predicts that trading in the agriculture business of its handling division should remain strong, except for the depressed South African forklift market The group anticipates trading conditions will continue to be difficult in the US and Europe and will focus on improving efficiency and reducing costs further.

The logistics business in South Africa is expected to perform "satisfactorily but the international operations will continue to be adversely impacted by the drop in trade volumes as a result of the global economic downturn".

Thomson says: "We expect to entrench our positions of market leadership and this will ensure we are well placed to weather the economic downturn and position ourselves for long-term success as the external environment improves."

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