For the first quarter of 2016, Agility yesterday reported a net profit of US$43.5 million, a respectable increase of 10.9 percent compared with the first quarter of 2015, which itself was a strong quarter for the air cargo world, due to the U.S. West Coast port slowdown. Earnings before interest, taxes, depreciation and amortization (EBITDA) rose by 12.1 percent to $87 million.
But that was not the most noteworthy announcement during the Kuwait-based logistics company’s quarterly statement. The real bombshell came later, when Agility CEO Tarek Sultan said he has established a goal to increase the company’s EBITDA to $800 million by 2020 – a nearly tenfold increase.
“We have a demanding road ahead to achieve this target, but have also defined a clear strategy and road map to meet this goal,” Sultan said. “We continue to improve our financial performance by focusing on growing our Infrastructure portfolio of companies and simultaneously driving transformation of our core commercial logistics (GIL) business.”
The GIL division achieved revenues of $749 million for the quarter, with net revenues up 0.6 percent, year over year. Revenue from the company’s infrastructure division rose 4.4 percent, but Agility did not release information on Q1 profits.
Sultan said most of its growth for the quarter came via contract logistics and through improved yields in its forwarding segment. “Agility has a strong contract logistics footprint in the Middle East [and] Asia Pacific that is serving growing consumer demand in these markets.” He added that the company would continue to make investments and was achieving success in its industrial real estate, ground handling and fuel logistics sectors.
“Agility started the year on a good note,” Sultan added, “despite challenging market conditions in the Eurozone, China and the Middle East. Our efforts to define a clearer strategy and improve execution are paying off in stronger customer relationships, an expanding emerging market footprint, a sharper focus, and a more disciplined management approach.”
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