The Brambles Limited (ASX: BXB) share price has been amongst the best performers on the S&P/ASX 200 index today.
In morning trade the supply chain logistics company's shares are up 4% to $11.43.
Why is the Brambles share price shooting higher?
This morning Brambles released its first quarter update ahead of its annual general meeting in Sydney later today.
According to the release, Brambles reported sales revenue from continuing operations of US$1,159.0 million for the first three months of FY 2020. This is an increase of 5% at constant FX rates and an increase of 2% at actual FX rates.
What were the drivers of its growth?
The company's Americas segment was the strongest performer. It reported a 7% increase in sales revenue during the first quarter.
Management advised that this reflected higher price realisation across the region, particularly in Latin America. Furthermore, rollover benefits from US pallet contracts won in the prior year and solid like-for-like volume growth in the US and Latin America supported its growth.
Brambles' CHEP EMEA sales revenue increased 4% during the quarter. This was driven by new business wins in European pallets and modest price realisation across the region. Like-for-like volumes were broadly flat, reflecting economic conditions in Europe.
Finally, its CHEP Asia-Pacific business delivered modest growth during the first quarter. It posted a 2% increase in sales revenue after like-for-like volume growth and price realisation in the pallets business offset lower RPC volumes following a contract loss in Australia.
Brambles' CEO, Graham Chipchase, appears to be happy with the company's start to the year and its future prospects.
He said: "Our first-quarter sales performance reflects pricing discipline and ongoing volume momentum despite increasing macroeconomic uncertainty in our major markets."
"We continue to make good progress with our US automation and procurement programmes and we remain on track to deliver an annual one percentage point of US margin improvement in each of FY20, FY21 and FY22," he added.
Pleasingly, Brambles has reiterated its FY 2020 guidance. It continues to expect sales revenue growth in the low mid-single digits. Whereas underlying profit is forecast to be in line with or slightly above its sales revenue growth.
It isn't just Brambles on the rise today. The Netwealth Group Ltd (ASX: NWL) share price has surged higher after a strong first quarter update of its own and the Orora Ltd (ASX: ORA) share price has rocketed higher after announcing a major asset sale.
