Dubai: Net profit slumped 18 per cent to Dh91.18 million at Aramex, the UAE based logistics services company, with revenues too coming in lower – albeit by 1 per cent only – to Dh2.97 billion.
The profit dip is also a function of the exchange rate impact, according to Aramex, namely from the declines in the Lebanese Pound and Egyptian Pound. During the second quarter, the squeeze on net profit was particularly marked, down 32 per cent to Dh44.6 million.
“Excluding the impact of write-offs from discontinued technologies and other one offs, normalized net profit for H1-2022 decreased 13 per cent year-on-year to Dh96.9 million,” said a statement.
In May 2022, the company distributed FY-2021 dividends of Dh0.13 per share, or Dh190.3 million.
Aramex is also keeping its gaze fixed on medium-term growth, especially returns from higher margin operations than those in courier delivery. According to Othman Aljeda, CEO, “One of the greatest changes we have seen in our business in the first-half of 2022 is the change in our revenue mix. Our freight-forwarding and logistics business was the star performer, helping offset the softness we have seen in the courier business.
The double-digit top-line growth of freight-forwarding and the growth in logistics is owed to our strategic investment in expanding our operations and market share and boosting our capabilities in that business.
The organic growth year to date is predominately driven by high-growth sectors such as industrials, SMEs, retail and pharmaceuticals.
- Othman Aljeda, CEO of Aramex
The courier business is confronted with 'industry headwinds', despite which Aramex was able to 'protect and maintain our gross profit margin'. "The softness in e-commerce activity is a global, industry-wide trend as consumers returned to brick-and-mortar shopping as COVID restrictions eased," said the statement. "We are also seeing rising inflation rates globally, which puts downward pressure on discretionary spending."
More to follow..