Forwarding helps Kerry Logistics lift revenue and core net profit in 2017
Hong-Kong-based forwarder Kerry Logistics reported today that, in 2017, it increased revenue by 28 percent to US$3.9 million, compared to the previous year, and increased core net profit by 7 percent to $150 million.
Of particular note was Kerry’s International Freight Forwarding (IFF) division, which saw a 14 percent rise in profits for the segment, based on a 41 percent surge in revenues, thanks to contributions from U.S. based Apex Logistics, which it purchased in 2016. IFF generated 22 percent of Kerry’s profits for the year and has become the growth driver of the Group.
However, the rising freight rates in 2017, which came from carrier consolidation, alliance reshuffling and capacity reduction, reduced the profit margin for IFF division, Kerry added.
Last year, the company made strides in expanding its presence in the Central Asian and Eastern European regions, capitalizing on demand for trade between the two continents. In June, it introduced a weekly railway service between Duisburg, Germany, and Shanghai as part of China’s “One Belt, One Road” initiative. The same month, Kerry teamed up with Dubai-based freight forwarder Globalink Logistics DWC, which operates across the Commonwealth of Independent States (CIS).
About a month later, it acquired a 50 percent stake in Lanzhou Pacific Logistics Ltd (LPL), a brokerage company that conducts business in more than 100 cities in China, Uzbekistan, Kazakhstan and Russia, further strengthening its reach throughout the land mass.
The company had a rough start in 2017 in terms of traffic, reporting a stall in global demand and a drop in cargo volume during Q1. The company cited protectionism as the culprit in its interim report, covering the first half of the year.
This most recent release claims the company is experiencing a “stable increase in cargo volume,” however, it does not show any figures regarding how traffic volumes have evolved through the year.
