Expolanka delivers best-ever quarterly performance for 3Q amid soaring freight rates

Expolanka Holdings PLC continued to push its limits as the logistics giant delivered another record high top and bottom line performance for the quarter ended December 31, 2021 (3Q22), on its core business which had been growing at a blistering pace since the onset of the pandemic. 

The logistics sector’s exceptional performance was the key driver of the group’s growth during the period. The sector recorded revenue of Rs.203.7 billion, up 255 percent from year ago, and a net profit of Rs.23 billion, reflecting growth of 384 percent. The performance was made possible by the expansion in volumes across both its air and ocean freight products and the ‘strong growth’ that came from its Far Eastern markets alongside its already established markets in Asia such as Sri Lanka and India.

The freight rates across air and ocean products, which remained elevated through last year due to the supply chain bottlenecks, reached all-time high levels during the quarter under review.

“The industry continued to experience demand supply imbalances due to growth in US retail sales, lower inventory levels, constrained belly capacity, which were further stretched due to disruptions in the ocean freight vertical,” Expolanka CEO Hanif Yusoof said.

“Origins such as Sri Lanka, India, Vietnam, China have performed remarkably well, whilst new markets such as Malaysia and Thailand have seen significant growth in business, an endorsement of the company’s regional expansion strategies.

Whilst the North America Trade lane remained the key driver of business, the European and Intra Asia business remained resilient with stable growth during the quarter”, he further said in an earnings release. 
At the consolidated level, the group reported revenues of Rs.204.9 billion for the quarter under review, up 254 percent over the same period a year ago. 

The earnings for the quarter under review stood at Rs.11.79 a share or Rs.23.04 billion compared to earnings of Rs.2.33 a share or Rs.4.55 billion in the same period in 2020. 

For the nine months ended December 31, 2021, the group reported earnings of Rs.21.20 a share or Rs.41.4 billion compared to earnings of Rs.5.55 a share or Rs.10.83 billion in the comparable period in 2020. 

Expolanka share gained 1.95 percent or Rs.7.00 on Friday to close at Rs.366.    Expolanka had a market capitalisation of Rs.715.5 billion as of last Friday, widening its lead from the second placed LOLC Holdings PLC, which had a market cap of Rs.558.8 billion.  The group’s other two business sectors—leisure and investments—also improved performance with the former turning a profit while the latter trimming its losses in the nine months. 
As at December 31, 2021, Japan’s SG Holdings Global Pte. Ltd. had 75.62 percent stake in Expolanka, while Yusoof held 7.52 percent stake being its second largest shareholder.