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Full Year 2021 Revenues Grow 10% to Record AED 6.07 Billion
- Buoyant global e-commerce continues to drive Courier Business volume growth of 10% in 2021 compared to 2020
- Freight-Forwarding Revenue up 22% in 2021 compared to previous year, following the implementation of the new operating model
- 2022 focuses on scaling business through optimized operating cost and capital expenditures in strategic areas to support sustainable growth of the business. Aramex forecasts continued growth in 2022 volumes and revenue at a faster pace compared to 2021
- Leveraging relationships with strategic investors GeoPost and Abu Dhabi Ports
The preliminary financial results and other information disclosed in this press release related to the Company’s Q4 2021 and FY 2021 performance are unaudited preliminary numbers and therefore, are subject to change. As a result, the Company’s audited financial accounts for Q4 2021 and FY 2021 may vary from the preliminary information contained in this press release.
|
In Thousands of AED
(unless otherwise stated)
|
FY 2021
|
FY 2020
|
% Change (YoY)
|
Q4 2021
|
Q4 2020
|
% Change (YoY)
|
|
Revenues
|
6,068,805
|
5,510,300
|
10%
|
1,611,545
|
1,598,346
|
1%
|
|
Operating Profit (“EBIT")
|
306,739
|
399,549
|
(23%)
|
59,713
|
89,166
|
(33%)
|
|
Operating Profit Margin (“EBIT")
|
5.1%
|
7.3%
|
(2.2%)
|
3.7%
|
5.6%
|
(1.9%)
|
|
Normalized Operating Profit (“EBIT")*
|
300,639
|
510,461
|
(41%)
|
57,521
|
147,193
|
(61%)
|
|
Normalized Operating Profit Margin*
|
5%
|
9.3%
|
(4.3%)
|
3.6%
|
9.2%
|
(5.6%)
|
|
EBITDA
|
676,404
|
741,376
|
(9%)
|
150,717
|
179,603
|
(16%)
|
|
EBITDA Margin
|
11.1%
|
13.5%
|
(2.4%)
|
9.4%
|
11.2%
|
(1.8%)
|
|
Normalized EBITDA Margin*
|
11.2%
|
15.5%
|
(4.3%)
|
9.7%
|
14.9%
|
(5.2%)
|
|
Net Profit
|
225,373
|
266,651
|
(15%)
|
46,078
|
58,649
|
(21%)
|
|
Normalized Net Profit*
|
183,285
|
377,564
|
(51%)
|
39,504
|
116,676
|
(66%)
|
Group Performance Highlights
- In Q4 2021, Revenues rose 1% YoY to AED 1.61 billion driven by strong performance in Logistics & Freight-Forwarding Business. FY 2021 Revenues jumped 10% YoY to a record AED 6.07 billion.
- Q4 2021 Operating Profit decreased 33% YoY to AED 60 million. The drop in operating profit is attributed to (1) Linehaul cost due to the continued pricing pressure (2) higher operating costs as the Company continued to scale operations to cater to higher demand and (3) Covid-19 induced costs and capacity constraints. FY 2021 operating profit declined 23% YoY to AED 307 million.
- Q4 2021 Net Profit fell 21% to AED 46 million compared to AED 59 million in Q4 2020. FY 2021 Net Profit decreased by 15% to AED 225 million, compared to AED 267 million in FY 2020.
- Focusing on working capital, Aramex maintained a strong balance sheet with a negative net debt position of AED 452 million, supported by a solid cash balance as at 31 December 2021.
At Aramex, we continued to provide our customers with best services levels, and continued to promote our crucial role in enabling cross border trade. We are also proud of the key role we played in providing the necessary infrastructures and processes for safely distributing Covid-19 vaccines. We continue to dedicate resources to support countries around the globe with their vaccine campaigns, further supporting their recovery.
Our market leading position and strong reputation has attracted an international peer, GeoPost, to become a strategic investor in Aramex. Their investment is a testament to the significant growth opportunities that Aramex is well positioned to capture in the mid to long term. As we look forward, we plan to continue exploring multiple synergistic opportunities and our focus on creating value for our shareholders and all our stakeholders.”
Othman Aljeda, Chief Executive Officer, Aramex, said: “2021 demonstrated our ability to capture growth opportunities spurred by a buoyant e-commerce market and good recovery in certain industries, while simultaneously implementing a fully redesigned operating model. The Logistics and Freight-Forwarding business produced outstanding results in a short period of time, and we continued to capture greater market share in the Domestic Express business despite an increasingly crowded last mile delivery sector in our core markets.
Our customer-first approach means we are absorbing a higher cost of doing business to ensure we continue to respond to customer needs, defend and grow our market share, despite the ongoing supply chain disruptions caused by the pandemic. As a result, our margins remain under pressure. While the pressures will likely continue in 2022, we have a defined strategy to grow the business and improve the profit margins. This includes investment in technology and operational optimization initiatives to strengthen and grow our business across all markets.”
Business Performance Highlights
|
Courier Business. Aramex’s courier business includes International Express and Domestic Express offers delivery and last mile solutions serving the B2B and B2C customer base including Shop & Ship, e-commerce, FMCG, SMEs and others.
|
Courier Business Financial Highlights
|
In Thousands of AED
(unless otherwise stated)
|
FY 2021
|
FY 2020
|
% Change (YoY)
|
Q4 2021
|
Q4 2020
|
% Change (YoY)
|
|
Courier Business revenue
|
4,143,962
|
3,935,398
|
5%
|
1,043,644
|
1,183,088
|
(12%)
|
|
International Express revenue
|
2,654,796
|
2,573,330
|
3%
|
671,393
|
796,493
|
(16%)
|
|
Domestic Express revenue
|
1,489,166
|
1,362,069
|
9%
|
372,251
|
386,596
|
(4%)
|
|
Courier Business EBIT
|
267,662
|
457,704
|
(42%)
|
41,367
|
129,229
|
(68%)
|
Courier Business Shipment Volumes
|
|
FY 2021
|
FY 2020
|
% Change (YoY)
|
Q4 2021
|
Q4 2020
|
% Change (YoY)
|
|
Number of shipments
(International Express)
|
25,756,639
|
24,695,684
|
4%
|
6,052,494
|
7,200,502
|
(16%)
|
|
Number of shipments
(Domestic Express)
|
108,226,277
|
96,632,684
|
12%
|
29,436,845
|
27,811,708
|
6%
|
|
Total Number of Shipments
(Courier Business)
|
133,982,916
|
121,328,368
|
10%
|
35,489,339
|
35,012,210
|
1%
|
- In Q4 2021, the Courier Business fell 12% YoY to AED 1.0 billion. The decline is partly attributed to a slowdown in both International and Domestic Express business compared to 2020, which was an exceptionally busy period due to Covid-19 related travel restrictions and lockdowns. FY 2021, the Courier Business grew 5% YoY to AED 4.14 billion driven by accelerated growth in the global e-commerce market. FY 2021 volumes for the business increased 10% YoY.
- Gross profit margins declined predominately driven by Covid-19 induced costs and disruptions including higher linehaul costs and airline capacity constraints. The business also incurred higher costs related to scaling operations and boosting capacity.
International Express (including Shop & Ship): - In Q4 2021, International Express business witnessed a 16% YoY decline to AED 671 million and a 16% drop in volumes on the back of significantly reduced demand from Asia, notably Hong Kong and China into the GCC. For FY 2021, the cross-border business increased 3% YoY, and shipment volumes increased by 4%.
Domestic Express:
- In Q4 2021, Domestic Express declined 4% to AED 372 million as volumes witnessed 6% YoY growth. The lower revenue and higher volume are mainly attributed to intensifying competition in the last mile delivery in some of our core markets. However, for the 12-month period, Domestic Express increased 9% to AED 1.49 billion versus FY 2020 driven by strong growth in KSA, UAE, Egypt and Australia from e-commerce and banking verticals while volumes rose 12% YoY.
|
Logistics & Freight Forwarding. Aramex’s Logistics & Freight Forwarding business includes air freight, sea freight, land freight, and warehousing and distribution solutions. It serves B2B customer base across multiple industries including oil & gas, healthcare & pharmaceutical, aerospace, retail & fashion, amongst others.
|
|
In Thousands of AED
(unless otherwise stated)
|
FY 2021
|
FY 2020
|
% Change (YoY)
|
Q4 2021
|
Q4 2020
|
% Change (YoY)
|
|
Logistics & Freight-Forwarding
|
1,760,407
|
1,459,594
|
21%
|
503,692
|
380,605
|
32%
|
|
Freight-Forwarding revenue
|
1,325,551
|
1,084,731
|
22%
|
390,676
|
279,847
|
40%
|
|
Integrated Logistics & Supply Chain Solutions revenue
|
434,856
|
374,862
|
16%
|
113,016
|
100,758
|
12%
|
|
Logistics & Freight-Forwarding EBIT
|
36,983
|
(68,184)
|
154%
|
20,213
|
(46,771)
|
143%
|
Freight-Forwarding Shipment Volumes
|
|
FY 2021
|
FY 2020
|
% Change (YoY)
|
Q4 2021
|
Q4 2020
|
% Change (YoY)
|
|
Land Freight
(FTL)
|
23,737
|
10,736
|
121%
|
7,498
|
3,175
|
136%
|
|
Land Freight
(LTL KGs)
|
27,853,731
|
13,855,624
|
101%
|
8,215,829
|
3,783,841
|
117%
|
|
Sea Freight
(FCL TEU)
|
30,215
|
42,547
|
(29%)
|
5,913
|
11,897
|
(50%)
|
|
Sea Freight
(LCL CBM)
|
179,322
|
140,399
|
28%
|
26,970
|
29,450
|
(8%)
|
|
Air Freight (KGs)
|
49,123,007
|
39,321,985
|
25%
|
11,594,436
|
11,621,351
|
0%
|
- In Q4 2021, this business unit jumped 32% YoY to AED 504 million on the back of strong demand from the oil & gas, retail & fashion and healthcare sector. The business was able to capitalize on growth opportunities thanks to the redesigned operating model.In FY 2021, top line grew 21% YoY to AED 1.76 billion driven by a rebound in global economic activity.
- Gross profit margin improved, driven by swift adoption of operational optimization initiatives.
Freight-Forwarding
- Freight Forwarding surged 40% YoY to AED 391 million in Q4 2021, predominantly driven by strong recovery in business activity across oil & gas, retail & fashion, and healthcare sectors. For FY 2021, this service line increased 22% YoY Revenue to AED 1.33 billion.
- Integrated Logistics & Supply Chain Solutions witnessed a 12% increase to AED 113 million in Q4 2021, on the back of increased demand from business activity in Saudi, Egypt, UAE and Morocco driven by the retail & fashion sector. For FY 2021, this service line climbed 16% YoY to AED 435 million as an increasing number of consumer businesses expanded their reach through e-commerce platforms.
Outlook
Commenting on the outlook for 2022, Othman Aljeda said: “We enter 2022 with a clear strategy to deliver our growth ambitions. Our new operating model will enable us to be better prepare to capitalize on the steady global economic recovery and grow our market share within both the Logistics & Freight Forwarding and the Courier Business.
We expect e-commerce to sustain a good growth momentum in 2022 and beyond. That is why for our Courier Business, we will be focused on driving new trade lanes for the global e-commerce market while positioning ourselves as the premier last mile solutions provider to businesses of all sizes in our core markets. Aramex has the benefit of scale, and we continue to solidify our position through expansion of our ground operations and fleet in core markets. We are also focusing on a differentiated premium product offer, as well as the end-to-end solution for the customer. Moreover, we have a clear strategic roadmap for automation of handling and sortation operations which will lead to better service levels and cost savings. We will continue to rely on data analytics and AI to optimize predictions, planning and route optimization to enhance every mile of the first to last mile journey.
Aramex Logistics currently accounts for a little under a third of our revenues and we intend to grow this to approximately half of total group revenues over the next few years. Our strategic priorities will focus on investing in a greener infrastructure, optimizing operational efficiencies, and strengthening our footprint in key growth markets including Egypt and KSA. We will also continue to transform how we serve SMEs and startup businesses customers by providing them innovative solutions including on-the-go warehousing solutions that are flexible and quick to set up.
Acquisitions remain a key enabler of our growth. To that end, we are seeking attractive and value accretive investment opportunities in markets that will enable trade flows into MENAT, and help us to further grow our global footprint.
*Extraordinary Items
|
In Thousands of AED
(unless otherwise stated)
|
FY 2021
|
FY 2020
|
% Change (YoY)
|
Q4 2021
|
Q4 2020
|
% Change (YoY)
|
|
Reported EBIT
|
306,739
|
399,549
|
(23%)
|
59,713
|
89,166
|
(33%)
|
|
Extraordinary Items:
|
|
|
|
|||
|
Less: Morocco provision reversal
|
(18,473)
|
-
|
(18,473)
|
-
|
|
|
|
Less: Morocco insurance refund
|
(6,243)
|
-
|
(6,243)
|
-
|
|
|
|
Less: Lebanon insurance refund
|
(6,611)
|
-
|
-
|
-
|
|
|
|
Less: Lebanon provision reversal
|
(2,339)
|
-
|
(2,339)
|
-
|
|
|
|
Add: Expected Credit Losses on Banks-Lebanon
|
5,491
|
21,301
|
2,788
|
21,301
|
|
|
|
Add: Morocco Fire provision
|
-
|
45,173
|
-
|
-
|
|
|
|
Add: Lebanon port blast provision
|
7,712
|
|
|
|
||
|
Add: Morocco Legal Provision
|
-
|
36,726
|
-
|
36,726
|
|
|
|
Add: Lebanon translation impact
|
22,076
|
-
|
22,076
|
-
|
|
|
|
Normalized EBIT
|
300,639
|
510,461
|
(41%)
|
57,521
|
147,193
|
(61%)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
In Thousands of AED
(unless otherwise stated)
|
FY 2021
|
FY 2020
|
% Change (YoY)
|
Q4 2021
|
Q4 2020
|
% Change (YoY)
|
|
Reported Net Income
|
225,373
|
266,651
|
(15%)
|
46,078
|
58,649
|
(21%)
|
|
Extraordinary Items:
|
|
|
|
|||
|
Less: Morocco provision reversal
|
(18,473)
|
-
|
(18,473)
|
-
|
|
|
|
Less: Morocco insurance refund
|
(6,243)
|
-
|
(6,243)
|
-
|
|
|
|
Less: Lebanon insurance refund
|
(6,611)
|
-
|
-
|
-
|
|
|
|
Less: Lebanon provision reversal
|
(2,339)
|
-
|
(2,339)
|
-
|
|
|
|
Less: InfoFort Gain
|
(31,606)
|
-
|
-
|
-
|
|
|
|
Add: Expected Credit Losses on Banks-Lebanon
|
5,491
|
21,301
|
2,788
|
21,301
|
|
|
|
Add: Morocco Fire provision
|
-
|
45,173
|
-
|
-
|
|
|
|
Add: Lebanon port blast provision
|
7,712
|
|
|
|
||
|
Add: Morocco Legal Provision
|
-
|
36,726
|
-
|
36,726
|
|
|
|
Add: Lebanon translation impact
|
17,695
|
-
|
17,695
|
-
|
|
|
|
Normalized Net Income
|
183,285
|
377,564
|
(51%)
|
39,504
|
116,676
|
(66%)
|