REPORT BASED ON PRESS RELEASE: BY ARMX ON NOV 08, 2023
Title: Aramex Reports Resilient Performance Amidst Global Challenges
Introduction:
Dubai, UAE – November 8, 2023: Aramex (DFM: ARMX), a global leader in comprehensive logistics and transportation solutions, today released its financial results for the third quarter of the year ending September 30, 2023. Despite facing persistent global challenges including inflationary pressures and currency fluctuations, Aramex showcased resilience, delivering robust performance across key financial metrics.
Robust Revenue Amidst Economic Headwinds:
In Q3 2023, Aramex reported a revenue of AED 1.35 billion, demonstrating a moderate 5% year-on-year decline. This decline was attributed to currency fluctuations and macroeconomic challenges, alongside subdued global retail activity in certain markets. However, excluding the impact of foreign exchange translation, the revenue decline was mitigated to 2%.
Strong Gross Profit and Margin Performance:
Despite the revenue decline, Aramex witnessed a noteworthy 4% year-on-year increase in Gross Profit, reaching AED 335 million in Q3 2023. The company’s Gross Profit Margin also increased to 25%, reflecting its commitment to operational efficiency and cost management. Additionally, the EBITDA margin remained stable at 10%.
Cost Management and Efficiency Measures:
Aramex prioritized cost management initiatives, resulting in a significant 9% year-on-year decline in organic General and Administrative Expenses (G&A) in Q3 2023. Despite an increase in selling expenses aligned with the company’s sales strategy, Aramex effectively managed costs, bringing organic G&A back to pre-pandemic levels.
Challenges and Opportunities in Net Income:
Reported Net Income declined to AED 9.6 million in Q3 2023, primarily due to increased interest expenses related to the acquisition of MyUS and other factors. However, normalized net income, excluding FX impact and finance loan expenses, stood at AED 30.4 million, reflecting a 23% year-on-year decline.
Strategic Geographical Presence and Market Leadership:
Aramex’s balanced geographical presence, with the GCC region leading as the highest contributor to Group revenues, remains a key advantage. The GCC region reported a remarkable 21% year-on-year growth in Gross Profit in Q3 2023, underscoring the company’s market leadership and resilience.
Outlook and Focus on Operational Excellence:
Looking ahead, Aramex remains focused on operational excellence, high-quality sales, and stringent cost management. As the company executes its strategic framework, it aims to enhance trade lanes, enrich the customer experience, and fortify operational capabilities across all business lines. With a steadfast commitment to delivering outstanding services, Aramex strives to expand its quality business lines and capitalize on growth opportunities.
Conclusion:
Despite the prevailing economic challenges, Aramex’s performance in Q3 2023 reflects its resilience, adaptability, and unwavering commitment to excellence. As the company navigates through evolving market dynamics, it remains poised to capitalize on opportunities and deliver long-term value to its stakeholders.
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