About Toll

Toll is one of the Asian region's leading providers of integrated logistics services, generating annual consolidated revenue in excess of $8 billion and operating a network of over 670 sites throughout 17 countries across the Asian region.

Toll's transport and infrastructure assets include ports, warehousing, road fleets, ships, rail rolling stock and air freight capacity.

These assets when combined with operational expertise and technology solutions, are aimed at driving supply chain efficiencies to deliver best practice in supply chain management for Toll's diverse customer base.

History

The Toll business was founded in 1888 by Albert Toll in Newcastle hauling coal with horse and cart. It became part of the Peko Wallsend Group in the 1960s when it transported goods associated with diversified mining and manufacturing activities.

In 1986 Toll was sold to a management buyout team led by current Managing Director Paul Little and former Chairman Peter Rowsthorn, and in 1993 Toll listed on the ASX.

Since listing on the ASX, Toll has progressively built and grown its unique logistics model in response to increasing customer demand for a complete end-to-end logistics solution, incorporating the critical components of operational expertise, scale, diversity of services, infrastructure and technology solutions.

Today, Toll is one of the Asian Region's leading providers of integrated logistics services. Toll's focused integrated transport and logistics strategy, when combined with its seamless use of technology, has provided, and will continue to provide, enhanced supply chain efficiencies. This integrated customer service offering is sought after in the market place, globally.

Snapshot of Toll

Market Environment

Toll is operating in a very competitive regional and global growth industry - the freight and logistics industry.

The outsourced freight and logistics market has experienced substantial growth over the past decade both in Australia and internationally. In addition, significant industry consolidation and rationalisation has occurred, as industry participants strive to effectively compete with increased customer demands requiring innovative solutions.

Australian and New Zealand Opportunities

Market Total = $66 billion

The Australian and New Zealand freight and logistics market is estimated at over $66 billion per annum, of which $33 billion currently remains in-house, providing further opportunities for Toll.

In Australia, it is anticipated that the freight task will double in size over the next 15 years creating significant opportunities for integrated industry participants able to offer supply chain efficiencies, reliable customer service and a seamless solution.

Industry trends have continued to evolve with more sophisticated and complex solutions requiring an integrated approach particularly in relation to international supply chains. The desire to generate efficiencies across the supply chain, and an increasing regionalisation of logistics supply requirements, is leading outsourced industry participants to embrace the evolving environment.

Key trends in the freight logistics industry include:

• Continuing focus by customers on achieving further integration and efficiencies associated with supply chain services;

• The increasing importance of cross-border capabilities, particularly throughout Asia;

• The increasing need for industry based logistics solutions;

• Further rationalisation of multi-national transport and logistics service providers;

• Growing importance of technology as a key enabler to efficiency gains; and

• The increasing importance of fuel costs, which has recently passed labour costs as the highest variable cost in linehaul road operations.

As a leading logistics participant within the Asian region, Toll is strategically positioned to provide customers with services that enhance their competitiveness in the markets in which they operate.

Toll is positioned with strong management, financial capacity, integration skills and a positive operational management drive to capitalise on domestic and international opportunities.

The provision of an integrated logistics service offering that incorporates international linkages to important regional sourcing markets within Asia, specifically China, is key to Toll's strategy in satisfying current and future customer requirements.

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