Aramex has announced first-quarter revenues of AED 1,106 million ($301.1 million), up 7% compared to the same period last year, with growth continuing to be driven by cross border e-commerce.
Net profits decreased by 5% to AED 91.8 million but the Dubai-based express and logistics company underlined that this was “due to the increase in value of the provision related to its incentive scheme.” Not accounting for this provision, net profit would have totalled AED 105.1 million, an 8.5% increase on Q1 2016.
Aramex noted that its “strong revenue performance” in the first quarter was driven by growth across Asia-Pacific. Revenues in other regions were affected by currency fluctuations, especially the Egyptian pound, which otherwise would have grown by 12%.
The company's International Express business recorded double-digit growth in Q1 2017, “driven primarily by the robust performance of cross-border e-commerce, and continues to be the main driver of growth for Aramex.”
Aramex added that its Domestic Express business “witnessed an increase compared to last year’s performance, with Asia-Pacific contributing significantly to this growth” while the company's Freight unit saw “a slight rebound in Q1 but was affected negatively by currency fluctuations.”
According to a Reuters report, Aramex's CEO Hussein Hachem told a press conference following the presentation of the company's full-year 2016 results in January that he expected a slower, single-digit increase in revenue and profits in 2017 but with strong e-commerce volume growth of 30%.
Commenting on the results for the first quarter, Hachem said: “Despite global and regional economic uncertainty as well as currency fluctuations, our revenue growth was positive and in line with our expectations. International Express was the key driver of growth in Q1 and will continue to drive Aramex’s business strategy and expansion plans.
“While we are cautious with regards to the GCC outlook, we are confident about carrying the same positive momentum into the second quarter of 2017. Looking further ahead, we will continue to enhance our business model through innovative technologies, with the aim to become a technology-based enterprise and maintain our position as a dynamic and disruptive global logistics player.”
Leveraging innovative technologies will continue to be a key focus for the business in the remainder of 2017. Aramex will also continue to actively look for future acquisitions and strategic partnerships in key markets to grow its global footprint, the company added.
Earlier this year, Bloomberg reported that Aramex was actively looking at acquisitions in Latin America and considering relocating some of its UK operations to France or the Netherlands if a future UK-EU ‘Brexit’ deal does not protect free trade flows.
In 2016, the company fully acquired Fastway Limited, further strengthening its presence in Australia and New Zealand. It also formed a joint venture with Australia Post to launch “Aramex Global Solutions”, a hybrid product accessible through postal offices worldwide.
