"The in specie dividend of Virgin Blue shares to shareholders, and strengthening of our balance sheet, have positioned the company to manage any significant downturn in economic conditions should it arise," Toll said in its 2008 annual report released on Thursday.
"At the same time, the strength of our ongoing cashflows and debt capacity will enable the company to pursue growth opportunities, both in Australia and in support of our global forwarding and Asian contract logistics businesses.
"Results to date for the June 2009 financial year have remained solid and are tracking well ahead of last year.
"Based on current trading conditions, the outlook for the full year is for strong earnings and cashflow generation to continue across the business."
Toll booked an annual net loss for 2007/08 of $695 million following a net adverse charge of $952 million arising mainly from the restructure of its investment in airline Virgin Blue Holdings Ltd and a gain on the sale of rail and ferry operations in New Zealand.
Continuing businesses generated a net profit of $258 million.
Toll disposed of almost all its 62.7 per cent stake in Virgin Blue via a special dividend to shareholders, as rising jet fuel prices ate into profits.
Toll said in its annual report that net debt at 30 June 2008 was $1.27 billion, including reset preference shares of $250 million.
Following the settlement of the New Zealand rail and ferry sale after balance date, net debt fell to about $650 million.
Based on net debt of $650 million, gearing was 24 per cent.
Toll said its core Australian business was extremely sound, its Asian businesses were growing, organic growth remained strong, and the group was winning new business solidly and consistently.
Toll chairman Ray Horsburgh amd managing director Paul Little said Toll had excellent opportunities in 2008 and beyond.
"In an environment that presents significant challenges for some, we possess significant strengths: a powerful balance sheet, significant cash reserves and available undrawn facilities, little net debt, low gearing and strong interest cover," they said.
"Our acquisition capacity is strong, and thanks to a well-executed business model, we're far less subject to volatility in uncertain economic conditions.
"We're in excellent shape and remain very optimistic about the future of our company."
