Aramex Achieves Robust Third Quarter Operating Margins
Aramex, a global leader in comprehensive logistics and transportation solutions, today released its financial results for the third quarter of the year ending September 30, 2023.
Through persistent global challenges, inflationary environment and currency fluctuations, Aramex delivered a robust Revenue of US$408 million in Q3 2023, a decline of 5% Year-on-Year (YoY) and a resilient Gross Profit of US$ 91 million, a growth of 4% YoY.
Excluding the foreign exchange translation impact, Revenue decline was 2% and Gross Profit growth was 8%.
Aramex's strategically balanced geographical presence continues to be an advantage; the GCC remains the highest contributor to Group revenues with a share of 40% of total revenues, with the region also reporting 21% growth YoY in its Gross Profit in Q3 2023.
The Company reported robust margin performance with Gross Profit margin increasing to 25% and a stable EBITDA margin of 10%.
EBITDA reached US$37 million, a decline of 5% YoY in line with Revenue softness indicating the continued focus on quality business, disciplined cost management and investment in operational efficiencies.
The Company's prioritization of cost management is also evidenced by the notable 9% decline in the Group’s organic (excl MyUS) General, and Administrative Expenses (G&A) in Q3 2023.
Notably, selling expenses for the organic business increased during the quarter, in line with the Company’s strategy to increase sales competencies in key verticals across key markets.
Reported Net Income declined to US$2.6 million for the Q3 2023 reporting period, largely led by the steep increase in interest rates since the MyUS acquisition.
Net income normalized for the FX impact and the increase in finance expense loans following the acquisition of MyUS transaction stood at US$8.4 million in Q3 2023, a decline of 23% YoY.
Aramex's International Express segment achieved steady growth, posting a 4% YoY increase in revenue, despite the softness in volumes. The Domestic Express business was resilient both on a YoY and sequential basis.
Despite industry headwinds, our focus on Freight-Forwarding delivered strong margins and for our logistics business, we continue to reposition it with increase in quality revenue from strategic sectors.