Australian logistics operators Toll and Brambles have reported higher yearly profits but the results have been overshadowed by speculation Toll, or its former ports division, Asciano, might launch a takeover bid for Brambles.

It has been a turbulent few years for Brambles.

In 2002, the company admitted 15 million CHEP (Commonwealth Handling Equipment Pool) pallets had gone missing.

Last year, Brambles sold their multi-billion-dollar Cleanaway business and also ended its dual listing on the London Stock Exchange after just five years.

Now the company has a new chief executive and despite all the change, Mike Ihlein says Brambles' key operations in pallets and document storage are improving.

"Our businesses of CHEP and Recall have remained focused and again have delivered strong profit growth in 2007," he said.

"We will continue to concentrate on delivering the potential of CHEP and Recall, as we stated in our results release, the outlook is very positive."

That has helped Brambles report earnings from continuing operations of $734 million, up 36 per cent on last year, although total profit was down 5 per cent because last year's result included earnings from Cleanaway.

Intersuisse research manager Peter Russell says Mr Ihlein is aiming for 20 per cent growth per annum.

"[But] it is unclear to me and I think to the market where that is going to come from," he said.

"The bet is on improving results in the US of CHEP pallets, but that will be difficult to do."

'A good opportunity'

And now a key Brambles client, Toll Holdings, and its spin-off, Asciano, appear set to cause more destruction.

The two firms have bought more than 4 per cent of Brambles shares in separate transactions.

Mr Ihlein says he has discussed the purchases with Toll and Asciano, but will not comment publicly on the matter.

"Our focus is on delivering on business performance and capturing the many opportunities that exist right across all of our businesses," he said.

Toll chief executive Paul Little is also keeping quiet about Toll's plans, maybe for the sake of its $83 million stake in Brambles.

"We see Brambles as a good opportunity - we certainly haven't lost any of our enthusiasm for that opportunity," he said.

"That's one that we've been looking at very carefully now for quite some time."

Mr Russell says Toll and Asciano have enough opportunities for organic growth and cannot see either mounting a takeover bid for Brambles.

"They probably both formed the view way back that pallets were an integral part of the logistics chain and it makes sense to have close cooperation and coordination right through that chain, which Toll is doing day by day," he said.

The Brambles speculation overshadowed Toll's own profit announcement, a 61 per cent increase in earnings from its continuing activities