Aramex posts 19% rise in Q1 net profit

International logistics company Aramex on Sunday announced net profits of AED43.1m ($11.7m) for the first quarter of 2009, a 19 percent rise from AED36.2m for the same period last year.

The firm’s revenues for the three-month period ending March 31 declined by six percent to AED463.4m compared to the same period in 2008, due to a global slowdown in trading and industrial output, the Jordan-based company said in a statement.

But Aramex’s revenues in the GCC showed an increase of five percent over the same first quarter last year, fuelled by growth in domestic and international express services, and despite a double-digit drop in freight forwarding revenues, said the firm, which has shares listed on the Dubai Financial Market and NASDAQ.

It said its strong financial performance reflected the adaptability of the company’s “asset-light” business model and its ability to adopt cost-effective programmes amid challenging market conditions.

The depressed economic climate helped Aramex in reducing costs by negotiating better rates with its major suppliers.

Aramex said it maintained a strong financial position backed by AED342.8m in cash and a very low debt position.

“Working as a team, we controlled costs at all levels, pursued market share aggressively, negotiated with suppliers, and protected our existing clients,” Fadi Ghandour, founder and CEO of Aramex, said. “As a result of these actions, our margins have improved.”

The company blamed a slowdown in global trade for hitting its freight activities, particularly in European and North American markets.  Freight revenues declined by 20 percent to AED174.5m in the first quarter of 2009, compared to AED218.8m during the same period in 2008.

Its revenues from international express grew by four percent in the first quarter from a year earlier, with revenues from its domestic express network growing by 10 percent.

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