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Saturday, 11 November 2017 00:00 - - {{hitsCtrl.values.hits}}
Leading logistics provider Expolanka Holdings announced its second quarter performance for 2017, delivering year on year revenue and gross profit growth amidst a challenging climate for business globally.
Expolanka Holdings generated a revenue of Rs. 21.7 billion (YOY growth of 34%), delivering a Gross Profit of Rs. 3 billion (YOY growth of 9.8%) for the quarter. The company delivered these results while accounting for two key factoRs.; a drop in GP Margin arising from an unanticipated industry wide increase in airline rates coupled with space constraints challenging the company’s procurement process, and an increase in overheads due to identified initiatives that were undertaken over the period. Both these factors resulted in a net loss of Rs. 89 million for the quarter.
In the Logistics sector, Expolanka continued to deliver strong top line performance by generating a revenue of Rs. 35 billion (YOY growth of 34%) during the fiRs.t half of the year. Air Export volumes grew by 25%, and Ocean Export volumes grew by 19% on a Year to Date basis. The company is focusing on accelerating growth from high potential origins in East Asia (China, Philippines, Vietnam and Indonesia) whilst expanding the core South Asia operation. Expolanka continues to retain emphasis on growing the core trade lanes of USA and Europe.
In the Leisure sector, consolidation continued with promising growth in the corporate travel solution business which recorded a revenue of Rs. 664 million for the first half of the year. With a key divestment, the company realigned its resources to growing the core travel solutions operation, leading to organic growth within the sector. The sector was able to deliver a Profit After Tax of 100 million (YOY growth 6%) for the same period.
The Investment sector recorded a revenue of Rs. 2 billion for the first half of 2017. The loss incurred in this sector is primarily attributed to the corporate center, which functions as a strategic and support service centre to the group.
With Asia reawakening to the key benefits associated with trade, Expolanka expects its Asia pivot to yield strong contributions to the overall business. Asia continues to be a key sourcing hub for Expolanka customers globally and the company’s continued growth in volumes and topline have been generated through these key markets, noted Executive Director and CEO Hanif Yusoof.
The challenge remains in addressing the externalities that impact gross margins and operational efficiency. “We are very confident that the corrective and precautionary measures we are taking in this regard will have a positive impact on our financial performance in the medium term,” said Yusoof. “This year has been a challenging one for us at Expolanka, as we attempt to grapple with an unforgiving external environment and the immediate overhead impact of some of our initiatives. We are taking immediate steps to mitigate external challenges, and are confident that our drive to expand and consolidate our business will yield very positive results in the medium term.
