Hong Kong-based freight forwarder and logistics provider, Kerry Logistics, reported its 2015 net profit up 9 percent, year-over-year, to US$136.75 million, and said it expects to see more forwarding growth this year from acquisitions
Gross revenues for the group’s combined logistics and freight forwarding activities were nearly unchanged from 2014 levels, at $2.72 billion. To summarize the year’s results, William Ma, Group Managing Director of Kerry Logistics, said, “Despite global macroeconomic volatilities and China’s slowing GDP growth, Kerry Logistics continued to implement its strategic plans and delivered sustainable growth for the seventh consecutive year.”
Kerry reported its freight-forwarding operations were insulated from falling business activity in China by growing e-commerce demand in Southeast Asia. Gross turnover for the unit derived from China fell 15.5 percent to $671.14 million, while revenues derived from Southeast Asia grew 10 percent, y-o-y, to $214.66 million. The group credits growth in Southeast Asia to its efforts to build an “ASEAN-wide regional express platform to tap into the increasing intra-ASEAN trade and the booming e-commerce market.” Overall profit for Kerry’s international freight forwarding operations increased 9 percent to $46.53 million for FY2015.
Looking ahead into 2016, the group said it expects significant growth in its freight forwarding unit resulting from a soon-to-close acquisition of a 51 percent controlling stake in an unnamed, California-based, full-service freight forwarding company. The transaction is expected to bring substantial increases to the volume and profitability of Kerry’s freight forwarding unit — particularly along trans-Pacific trade lanes. Kerry expects this new acquisition to contribute to its earnings by the end of 2016.
In a statement given to the Wall Street Journal, Ma said that acquisitions represented “an instrumental part of [Kerry’s] long-term [international freight forwarding] strategy to build a global network across six continents.” Kerry’s foray into the U.S. market follows acquisitions of controlling stakes in Dubai-based Able Logistics Group FZCO, and a Canadian-based ocean and airfreight consolidator, Total Logistics Partner.Like This Post