Rate Increase Notice for Star Track customers with special quoted rates

October 12, 2010 Edward

Our annual review of cost changes has been completed and in accordance with our agreement all special quoted rates are due for adjustment.

During the past year our wages and salaries costs have increased by 4.00%. The majority of this increase arises from EBA’s concluded prior to the Global Financial Crisis. The price of trucks, forklifts, motor vehicles and depot equipment has increased by an average of 4.92%. Other expenses, particularly industry compliance costs, property on-costs and insurances, have increased by an average of 5.78%. Based on the respective percentage of outgoings for each of the above items excluding fuel, we advise a 3.9% increase to all special quoted rates effective from the billing week inclusive of 1 November 2010. These rates will be held firm for a further twelve months subject to any unexpected extraordinary cost increases which may occur.

Despite recent price reductions, our average purchase price of diesel fuel in the past year is 38.8% higher than our 2004 base year average price. Accordingly our separate fuel surcharge, which reflects international oil prices, exchange rates and other supply and demand factors, remains in place. As fuel prices continue to fluctuate our current surcharge will be increased or decreased on a monthly basis until future stability prevails.

We have been focusing on improving service throughout 2010, achieving a national service success rate of 99% in the September 2010 quarter measured over ten service categories. Our objective has always been to provide the best express freight service in the industry and to achieve a success rate as close to 100% as possible.

We make every effort to contain cost increases within our control to minimise the impact on our customers. The revision to your special quoted rates and rate schedules will be in your hands prior to the due payment date for the billing week inclusive of 1 November 2010.

Thank you for your continuing support.

Yours sincerely,
Rene Pamount
Director of Customer Service