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Kerry first half profit up 11pc to US$69.9 million as revenue rise 2pc

HONG KONG's Kerry Logistics Network posted an 11 per cent first half net profit increase to HK$542 million (US$69.9 million), drawn on revenues of HK$10.1 billion, which went up two per cent year on year.

"The global economy continued to be plagued with volatilities in the first half," said Kerry Logistics managing director William Ma.

"In face of these challenges, Kerry Logistics focused on honing its core competence in delivering highly customised solutions tailored to industries with growth potential," he said.

"The group was able to achieve steady growth in overall operating profits, while businesses in the Greater China region remained relatively stable driven by our strong performances in Hong Kong and Taiwan," said Mr Ma.

Kerry's Hong Kong warehouse portfolio comprises of nine warehouses with a combined gross floor area (GFA) of 5.1 million square feet. It maintained nearly full occupancy and double-digit growth in rentals for contract renewals.

Additionally, it operates with an asset ownership model to offer greater reliability and flexibility to customers.

In Thailand, Phase 1 of the Kerry Bangna Logistics Centre has been completed in 2015 Q2. It will serve as a new sorting centre for Kerry Express and a fulfilment centre for e-commerce customers.

In Cambodia, the Kerry held ad groundbreaking ceremony in July for the construction of a 160,000 square feet bonded warehouse at a Free Trade and Special Economic Zone located in Khan Dangkor, Phnom Penh.

The company further expanded its operating scale and strengthened its network coverage through a number of investments and acquisitions.

In Greater China, Kerry Logistics (China) Investment Limited, a subsidiary, signed a strategic cooperation agreement with China Railway Import and Export Company (China Railway) in April in Beijing.

The agreement will leverage China Railway's extensive railway network and experience in undertaking key domestic and international projects, and effectively integrate them with Kerry Logistics' strong network in southeast Asia and its logistics service expertise.

In March 2015, the group expanded its business in Indonesia by investing in PT Puninar Saranaraya, one of Indonesia's largest logistics companies.

Additionally, the group took further steps to build an ASEAN-wide regional express platform to tap into the increasing trade and the growing e-commerce market in the region.

Following the acquisition of a local express company in Cambodia in 2015, Kerry Logistics targets to complete the expansion into Laos and Malaysia in 2015 2H as well as into the Philippines, Indonesia, Myanmar and Singapore in the near future.

In the Middle East, Kerry Logistics strengthened its IFF capacity and network through acquiring a controlling stake in Able Logistics Group FZCO, an established international freight forwarder headquartered in Dubai with a leading position in the region, to offer global connections through a round-the-clock transit hub linking Asia to the Middle East, Europe and Africa.

The group also further expanded its global network into Canada following an acquisition of the majority stakes in Total Logistics Partner Ocean Consolidators Inc and Total Logistics Partner Air Express Inc, two Canadian freight forwarding companies focusing on the Asia-Canada trade.

In the US, Kerry Logistics signed a memorandum of understanding with a major NVOCC, focussing on ocean freight from Asia to the US, to acquire a majority interest in the company. Specialising in transpacific trade lanes, the company offers a full suite of services in the US.

Said Kerry chairman George Yeo: "Despite challenges in the near term, the group maintains a positive outlook for the industry in the medium to long term. Driven by the 'One Belt One Road' policy, and the further development of the new Silk Road, China's logistics industry will become more sophisticated, playing to Kerry Logistics' strengths."