Business Description:
Toll Holdings Limited (TOL) is an integrated logistics provider in the Asian region and operates an extensive network throughout Australia, New Zealand (NZ) and Asia delivering seamless, end to end, local, regional and global supply chain solutions. TOL serves businesses in automotive, beverage, food and retail, industrial, ports, resources and relocation sector.

Strategy Analysis:
TOL has established itself as a major supplier of transport, logistics and freight forwarding services in Australia, with a high level of exposure to retail, food and fast moving consumer goods and limited exposure to the resources sector. In the current domestic economic conditions the company´s strategy is causing earnings to languish. Senior management have started addressing the issue by acquiring the second largest mining transport services company in Western Australia. In addition, due to the fragmented nature of the domestic market TOL is continually needing to undertake acquisitions to ensure its competitive advantage is maintained. During the past five years, TOL has divested significant businesses and assets, including ports, rail businesses and the shareholding in Virgin Blue. But a strong balance sheet and retention of solid cash-generating businesses during the global financial crisis provided the company with an opportunity to embark on the well-considered Asian growth strategy. While momentum builds in the global logistics and global forwarding businesses they still face weakness and uncertainty in the current global economic conditions due to a lack of size. Toll Holdings reported NPAT of $281.4m for the year ended 30 June 2011. Revenues from ordinary activities were $8.22bn, up 18.4% from last year. Revenue growth benefitted from Toll Global Logistics' strategy of an Asia-focused footprint with global connectivity. Revenue and EBITA performance at In2store and Contract Logistics increased with a number of new contract wins. New business wins and improved warehouse utilisation in the South and SE Asia region also contributed positively. Diluted EPS was 39.8 cents compared to 39.8 cents last year. Net operating cash flow was $540.0m compared to $391.7m last year. The final dividend declared was 13.5 cents, taking the full year dividend to 25 cents, in line with 25 cents last year.