Agility airfreight beats the market but net revenue under pressure

Agility’s air freight tonnage grew 14.7% in the second quarter of 2017 – above the market average, said the Kuwait-based forwarding and logistics company.
The air cargo performance contributed to a 9.6% increase in revenue for Agility Global Integrated Logistics (GIL), the company’s core logistics business, in the quarter, to 255.2 million dirhams.
Ocean teu grew 12.9%, again above the market average, said the company.
Contract logistics revenue also grew, particularly in the Middle East and Asia Pacific, due to a combination of new and existing warehousing facilities.
However, net revenue in the quarter was flat compared to the same period a year ago, primarily due to significant yield degradation in freight forwarding because of capacity constraints and higher market rates.
Net revenue margins contracted to 24.9%, compared with 27.3% in Q2 2016. EBOTDA earnings decreased 5.8% to KD 9.1 million for the same reason.
Agility vice-chairman and chief executive, Tarek Sultan, Agility’s Infrastructure group was the primary driver of performance in the quarter, with industrial real estate business and aviation services delivering particularly strong results.
He added: “Revenue in our logistics business is growing because air and ocean volumes are increasing and contract logistics revenue is expanding, but rate pressure continues to affect profitability.”