Aramex reports strong financial performance with 2x growth in Q4 2023 net income

Image credit: Supplied

Aramex, the largest courier company in the Middle East, has announced impressive financial results for the fourth quarter of 2023, marked by a significant increase in net profit.

Aramex earnings

The company’s net profit for the period soared by 127 per cent, reaching Dhs76.7m ($20.9m), attributed to record quarterly volumes in its international express unit and robust growth in the GCC and wider Middle East, North Africa, and Turkey (Menat) markets.

Despite challenging market conditions and currency fluctuations, Aramex managed to achieve a 33 per cent year-on-year increase in earnings before interest, taxes, depreciation, and amortization (EBITDA) for the final quarter of 2023, reaching Dhs197.4m.

This growth was driven by tighter cost management and operational efficiencies.

However, the company reported a 1 per cent decline in revenue for the same period, totaling Dh1.52bn, primarily due to softer growth in other business segments. Markets in the GCC and Menat region accounted for half of Aramex’s group revenue, highlighting the company’s strong presence in these key markets.

Othman Aljeda, CEO of Aramex, expressed satisfaction with the exceptional performance in the fourth quarter, emphasizing the record quarterly volumes in international express and improved profitability across the group. He noted that despite global operating challenges, Aramex continued to excel, underscoring the strength of its home markets in the GCC and wider Menat region.

Red Sea tensions

Amidst ongoing disruptions in global logistics due to attacks by Yemen’s Houthi rebels on commercial vessels in the Red Sea, Aramex stated that it is closely monitoring the situation.

The company is leveraging its trucking fleet in the region to provide alternative solutions to its customers, deploying trucks via Dubai, UAE, Dammam, Saudi Arabia, and Port Said, Egypt, to ensure the smooth onward journey of shipments arriving from various regions.

While Aramex’s international express unit witnessed remarkable growth in shipment volumes and revenue, other business segments experienced softer performance.

The freight-forwarding unit reported a 9 per cent annual decline in revenue to Dhs383.9m, attributed to a drop in global freight rates. Similarly, the domestic express unit posted a 4 per cent year-on-year decline in revenue to Dhs361.7m, reflecting flat shipment volumes amid subdued retail activity worldwide.

For the full year 2023, Aramex’s net profit attributable to equity holders declined to Dhs129.2m, compared to Dhs165.3m in 2022. The company cited a rise in finance costs and the impact of currency swings as factors affecting its annual profit.

Despite these challenges, Aramex remains optimistic about its future prospects, buoyed by its strong performance in key markets and its ongoing commitment to operational excellence and customer satisfaction.

Read: Etihad passenger numbers up 35% year-on-year