Western Pallet Magazine October 2021 | Page 24

22 WESTERN PALLET

Brambles Reports Revenue Increase of 9%, CHEP Faces Pallet Availability Challenges

Pallet availability and balances across the CHEP North American network are not expected to return to more normal levels until the fourth quarter of the fiscal year.  Focus remains on serving existing customers.

Brambles has reported revenue increases of 9% for the first quarter of its 2022 reporting year. Revenue was almost US$1.3 billion. Volumes were in line with the prior corresponding period as net new business growth of 2%, primarily in the European pallets and Australian RPC businesses, was offset by lower like-for-like volumes in North America largely due to pallet availability constraints.

The company says its first-quarter sales growth demonstrates the effectiveness of its pricing and surcharge mechanisms in supporting the recovery of increased costs across global supply chains. The company states that it continues to operate in a high inflationary environment with pallet availability constraints and ongoing lumber, labor, and transport scarcity disrupting supply chains and driving increased costs across its businesses.

“Pallet availability remained challenging in the first quarter with industry-wide shortages of new pallet supply across the globe as well as lower levels of pallet returns and longer cycle times in our North American business,” stated Graham Chipchase, Brambles CEO. “This was a contributor to the decline in like-for-like volumes in North America and contributed to the lower rates of new business growth across the Americas and Europe, as we prioritized servicing existing customer demand over new customer wins.”

The company incurred additional plant and transport costs to collect, relocate and repair existing pallets due to suboptimal levels of plant stock across its network. This situation has resulted in further network inefficiencies as the company continues to respond to volatile customer demand.