Online shopping growth helps Aramex raise profit 15%

Aramex, the Dubai-based courier company, posted a 15 per cent rise in second-quarter net profit helped by the growth of online shopping.

Net profit grew to Dh92.6 million, up from Dh80.8m a year earlier, the company said in a statement. Revenue rose about 6 per cent to Dh967m from Dh915m.

"Significant revenue growth was recorded from both the international express and domestic express businesses due to a continued increase in demand for global online shopping services particularly in the GCC, Europe and North America," Aramex said in a filing.

“Growth in the freight business was negatively impacted by the recent drop in global oil prices and currency fluctuations, while logistics recorded a particularly strong performance mostly driven by growth in core GCC markets and South Africa.”

The price of Brent crude has lost about half of its value since peaking at $115 per barrel in June last year because of an oil supply glut, weak demand in Asia and Europe and a strong dollar. The strong greenback has battered currencies including the euro.

“While we’ve had a strong double-digit net income, our revenues would have reached 10 per cent had we not been faced with weak global currencies,” the Aramex chief executive Hussein Hachem said.

“While we remain confident about extending our growth momentum and performance into the remainder of 2015, the impact of global oil prices and weak major currencies continue to be areas we will carefully monitor moving forward.”

The company, which acquired PostNet South Africa for US$16.5m and Australia’s Mail Call Couriers for $26m last year, will continue to hunt for acquisitions in the second half of this year, it added in the statement.

“We will also continue to seek potential acquisitions in the second half of 2015 for companies sharing the same synergy with us, and for that we have made available a new line of credit from a consortium of banks in the UAE,” Mr Hachem said.

Shares of Aramex fell 1.16 per cent to Dh3.42 in Dubai on Wednesday.

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