Dubai courier Aramex posted a 36 per cent increase in second-quarter net profit, beating analysts’ forecasts, thanks to a one-off fair value adjustment regarding its Egyptian joint venture, AMC Logistics .
Aramex made a net profit of Dh125.7 million in the three months ending June 30, compared with Dh92.5m a year earlier, the company said.
“Though we finished strongly, we experienced slowing growth at the end of the quarter,” said the chief executive Hussein Hachem. “We are closely watching this trend so we can quickly adjust to further volatility, and remain cautiously optimistic about continuing our growth momentum into the second half of 2016.”
The Dubai-listed firm’s results beat projections of the investment banks EFG Hermes of Egypt and Sico Bahrain.
“Adjusting for the one-off, core earnings were much weaker than our estimate where we could attribute the miss to higher than expected operating expenses and financial charges,” said Ayub Ansari, an analyst at Sico.
Revenue surged 17 per cent to Dh1.1 billion from Dh946m a year earlier as the company’s various businesses grew, particularly in Europe, Asia and Australia. Last year the acquisition of the New Zealand and Australia business of New Zealand’s Fastway Couriers for NZ$125.2m (Dh326.1m) shored up revenue.
The Arabian Gulf region was flat, while the Levant had healthy growth.
“Weak macros, particularly in the GCC region, could weigh on future growth of Aramex,” said Mr Ansari.
“Strength of the USD is also a near-term risk to Aramex given its growing exposure outside the GCC region.”
Aramex shares ended up 3.63 per cent to Dh4 in Dubai.
According to Bloomberg, Jaona Investments has purchased 99.4 million Aramex shares at Dh4.4 each, giving it a 6.55 per cent stake in the company. The sellers were not named, the report said.
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