By Gavin Gibbon
Annual figures show 'shifting dynamics' in logistics industry, according to CEO Bashar Obeid
Dubai-based logistics giant Aramex has revealed a one percent increase in net profit for 2019 to AED497.4 million, compared to AED492.6m from the previous year.
Announcing the annual results, Bashar Obeid, CEO of Aramex, said the marginal increase came off the back of global economic challenges and pricing pressures prompted by shifting e-commerce dynamics.
He said: “In 2019, we strategically focused efforts on upgrading our operations and deepening our commitment to building a digital infrastructure that enables a higher service level to customers, more efficient processes to handle strong growth in shipment volumes and partial mitigation of impacts from pricing pressure, especially in our express business.
“More specifically, we invested heavily in the last mile operations, one of the most critical and competitive stages of the delivery journey. This has enabled us to become the leaders in last mile in our core markets.”
Aramex’s Q4 2019 revenue grew by three percent to AED 1,463m, compared to AED1,425m in Q4 2018. However, Q4 net profit dropped slightly by 1 percent to AED152.5m, as opposed to AED154m in the previous year.
In Q4 2018, Aramex registered a one-off impairment of AED46m from the divestment of Aramex Global Solutions (AGS).
Aramex's international express business declined four percent to AED673m, compared to AED702m in Q4 2018. This was attributed to the continued pressure on pricing for e-commerce business in Aramex’s Asian markets, especially China and Hong Kong, despite the growth in volumes.
Domestic express surged 20 percent, to AED324m, compared to AED270m in Q4 2018. A statement from the company said: “The significant growth in this business line is attributed to the double-digit growth in core markets, notably from Saudi Arabia, Egypt and UAE. Excluding India restructuring and impact from exchange rate fluctuations, Domestic Express growth would have reached 26 percent.”
Aramex’s Logistics and supply chain management business grew by 15 percent to AED97m, compared to AED84m in Q4 2018, as a result of the growth of business across the company’s key markets, especially in the UAE and Saudi Arabia.
Iyad Kamal, chief operating officer at Aramex, added: “Over the course of the year we have invested in strategic ground infrastructure projects specifically in our core markets with the ultimate objective of boosting operational efficiencies and enhancing the overall customer experience.
“Our efforts, together with the continuous commitment and dedication of our passionate teams around the world, have enabled us to handle growth of 30 percent in shipment volumes in our core markets efficiently with an improvement in delivery times.”For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.