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Expolanka Holdings Plc yesterday announced exponential performance for the just-ended FY21 with a hefty net profit of Rs. 14.8 billion as opposed to a loss of Rs. 438 million in the previous year, with the COVID-19 pandemic triggering a windfall for the logistics business.
First conglomerate to announce full-year interim results, Expolanka’s profit figure is likely to be within the top three by a non-banking institution.
The group delivered a revenue of Rs. 75.5 billion, up 218% from FY20 with a gross profit of Rs. 11.9 billion and a Profit after Tax of Rs. 4 billion for the quarter as against a loss of Rs. 333 million a year earlier.
The impressive 4Q performance enabled the group to generate an annual revenue of Rs. 218.7 billion (up 111.8%), gross profit of Rs. 38.4 billion and a profit after tax of Rs. 14.8 billion. In FY20, Expolanka suffered a Rs. 438 million loss.
Group CEO and Director Hanif Yusoof admitted Expolanka Holdings was able to conclude an exceptional year where “we have not only been able to successfully overcome the challenges posed by the global pandemic, but also strengthen our position as a reliable, dependable, customer-centric global logistics company”.
He said the hallmark of Expolanka’s success has remained its focused and consistent strategy aided by a disciplined approach to execution, which has enabled the Group to perform and transform during the year.
“The extraordinary results we achieved this year has been in the backdrop of an extremely dynamic operating environment which has been impacted by reduced capacity, elevated rates and weak global trade. This resulted in our strategy being put to the test, and our resilient, steadfast and strong response enabled us to achieve outstanding results during the year,” Yusoof said in a note accompanying interim accounts.
“Our holistic and integrated approach in customer centricity, expanding our service portfolio, strengthening origin performance, consolidating the procurement function, and investing in technology remained the cornerstone of our strategic response,” the Group CEO/Director added.
This translated into the sector delivering a Revenue of Rs. 74.9 billion, gross profit of Rs. 11.7 billion and a PAT of Rs. 4.5 billion for the quarter.
Yusoof said Expolanka continued its unrelenting focus on sales which enabled the company to see volumes from existing customers and new customers whilst Yields continued to remain stable in the face of elevated freight rates, and proactive strategies adopted by origins ensured service delivery to customers in the most efficient manner.
A cohesive effort spanning the entire organisation, with strong contributions from all origins, underpinned the initiatives led by the sales and procurement teams, he added.
According to Expolanka, the airfreight market remained disrupted with elevated freight rates contributing towards higher yields. Ocean Freight market too remained very dynamic with port congestions and reduced containers resulting in relatively higher rates.
“Despite lower capacity and higher rates, EFL was able to leverage its long-term carrier partnerships, supported by proactive procurement strategies, enabling the company to secure healthy profitability during the quarter,” he added.
The airfreight portfolio continued to be the largest contributor of profitability for the sector, whilst the Ocean freight segment continued to build on its strong progress during the year. Business continued to be driven by the North America trade lane which saw renewed growth amidst positive and improved market sentiments.
Commenting on the leisure sector which reported a loss, Yusoof said the opening of the airports and reduced travel restrictions, has seen a marginal improvement to the business operations of the sector, which remained focused on its core operations.
The sector maintained its intent to reorganise its business portfolio to optimise on opportunities when the industry returns to normalcy.
From a portfolio perspective, the company has identified the need to focus its operations on innovative and experiential travel solutions. The robust cost restructure initiative too continued during the quarter, enabling the sector to operate in a lean and efficient manner, mitigating impacts whilst safeguarding the brand.
Yusoof also said the investment sector generated a revenue of Rs. 462 million for the quarter with the largest contribution coming in from the export operations. The pandemic continued to impact the performance of the export business, which continued to re-evaluate its product portfolio to focus its growth initiatives on higher yielding products.
The technology servicing arm continued to demonstrate strong progress by expanding its customer portfolio and market presence in the local market.
“The resurgence of the pandemic during the last few months, will continue to disrupt global supply chains, further lengthening the recovery periods and extending dynamic market conditions. The company continues to remain aware of the continuously evolving landscape,” Yusoof told Expolanka shareholders.
