Aramex announced its financial results for the second quarter (“Q2”) and first half (“H1”) ending June 30, 2024.
Both International Express and Domestic Express achieved significant y-o-y volume growth of 32% and 5% respectively, expanding the company’s customer base while maintaining good service levels in the first half of the year (H1 2024). Freight Forwarding navigated a complex environment, marked by increased rates and competition, achieving growth in volumes in H1 2024, as it focused on consolidating its position on key lanes. Logistics onboarded several new customers during the first months of the year, effectively replacing legacy accounts.
Aramex achieved a robust 8% y-o-y increase in revenue for both H1 and Q2 2024, driven by revenue growth from all product lines. The revenue performance in the first half of the year is attributed to new customer wins and volume growth.
The Company maintained a tight control over Group Selling, General, and Administrative Expenses (SG&A), with costs growing in line with revenue in H1 2024. Selling expenses increased in line with the company’s strategy to focus on sales specialism, while G&A were well managed, delivering a stable SG&A-to-revenue ratio of 20%, an improvement of 0.7 pps over H1 2023.
The first six months of the year saw a solid 5% y-o-y increase in Gross Profit, with a healthy Gross Profit Margin of 24% amid ongoing efficiency maximization and cost optimization efforts. Net profit showed a steady rise of 15% y-o-y in H1 this year, driven by a 20% growth in EBIT and an improved EBIT margin, indicating strong operational performance despite Q2 2024 impact.
Aramex is poised to sustain its growth momentum across key product lines in the second half of the year and is expected to deliver a good performance for the full year 2024 with an estimated growth of 8% to 9% in Group Revenues and an approximate Gross Profit Margin of 24% to 25%. The company will continue its strategic investments in infrastructure and talent to broaden its customer base and prioritize exceptional service, keeping it on course to meet year-end targets.
Aramex continues to be well-positioned with a cash position of AED 457m and a Net Debt-to-EBITDA ratio of 0.9x (excl. IFRS16) as of June 30, 2024. Management’s focus on value creation delivers 40 basis points improvement in ROIC, currently standing at 5.2% for H1 2024.
Source: Aramex
