Dubai: Logistics company Aramex saw net profit surge 14 per cent to Dh78.7 million during the first quarter of the year compared to Dh69.3 million recorded during the same period in 2013, according to a company statement yesterday.
The company’s revenue, meanwhile, touched Dh852 million, marking an increase of six per cent over Dh803 million, which the company recorded during the first quarter of 2013.
Aramex’s stock closed at Dh3.20 yesterday, down 1.54 per cent from the previous closing, according to the Dubai Financial Market website.
The drivers behind Aramex’s performance were the growth of its operations in the Middle East, sub-Saharan Africa and Asia across its express, freight and logistics businesses, the company said.
“International express in particular achieved excellent growth, driven by increasing demand and revenues from regional and global e-commerce,” said Hussain Hashem, CEO of Aramex, in a statement.
Online portal
The company has an online shipping service called Shop and Ship. Online portals, including JadoPado, Namshi.com and Alshop.com, have signed up for the Shop and Ship merchant programme.
Shop and Ship lets consumers from 52 global cities, including New York, London, Shanghai, Dubai and Mumbai, to buy from any online store in the world. The service sets up postal addresses to receive orders in these cities and then forwards the packages on to the consumer’s actual home address.
Meanwhile, Aramex is looking at acquisitions in sub-Saharan Africa and Asia and expanding its oil and gas services in North and East Africa, it said.
The company is investing over $100 million (Dh367 million) on its Dubai Logistics Centre and its operations in Saudi Arabia and Oman..
Last year, the company’s net profit grew by 14 per cent to Dh278 million, while revenue reached Dh3,325 million, up 8 per cent compared to Dh3.072 billion achieved in 2012.
More opportunities exist for companies that operate in the ecommerce sector since penetration of ecommerce is low compared to other markets. Only “15 per cent” of consumers in the UAE buy online, according to Emmanuel Durou, director of strategy consulting at global consultancy Deloitte.
“Digital adoption [in the region] has been lower than in other markets,” he said.
Low credit card penetration in some regional markets and the difficulty in delivering goods as result of a lack of postal addresses are some of the reasons behind the slow growth of ecommerce penetration in the region, he said.
