Poor airfreight volumes hurt Expolanka...

Expolanka Holdings PLC’S top-line stagnated and profits fell during the quarter ended December 31, 2019 as the third party logistics player saw its lucrative airfreight business taking a hit as a result of the slowdown in global trade volumes.

The group earned revenues of Rs.27.8 billion in the three months to December 2019 (3Q20), little changed from the same period last year.

The company reported earnings of 15 cents a share or Rs.302.3 million for the October-december period, compared to 24 cents a share or Rs.469.6 million reported for the same period last year.

For the nine months, the company turned a loss per share of 19 cents on a total loss of Rs.374.9 million compared to a profit of 54 cents a share or Rs.1.1 billion in the corresponding period a year ago.

“The performance of the logistics sector of the group was impacted by the challenging external environment. The airfreight market has recently witnessed its 10th straight month of volume decline on a year-on-year basis, primarily as a result of trade protectionism strategies and market uncertainties,” said Expolanka CEO Hanif Yusoof in an earning review.

While Expolanka group has three main business vertices logistics, leisure and investments, which contains its exports and Information Technology services and corporate office— 95 percent of the business is into logistics.

Logistics operations, which contain warehousing, generated Rs.26.5 billion revenue out of the total revenue of Rs.27.8 billion reported for the quarter under review.

Despite the downtrend in airfreight business, Expolanka’s ocean freight business sustained its growth, Yosoof stated.

“The ocean freight segment of the business continued to grow steadily, with renewed focus on the segment.

“Despite volumes being stable, the yields of the business saw a decline during the quarter. Nevertheless the sector was able to generate a gross profit of Rs.4.5 billion for the quarter, slightly below the performance last year,” he added.

Despite the temporary dip in the performance, Yusoof said the company continued to acquire customers, focusing on volumes and devising strategies to optimise yields.

“Our ability to remain agile, flexible and remain customer-centric has enabled us to sustain our operations during the year,” he said.

As of December 2019, Japan’s SG Holdings Global Pvt. Ltd held 68.19 percent stake in Expolanka while Caceis Bank, Luxembourg Branchbarca Global Master Fund held another 8.89 percent.

Yusoof had 7.52 percent stake being its third largest shareholder.