Freight forwarder and logistics operator T3EX Global Holdings Corp (台驊國際投資控股) yesterday gave a positive outlook for this year on the back of China’s rapidly growing household consumption.
Apart from air and ocean freight, the company said that it would tap into China’s consumption growth by expanding its rail business in the country, focusing on deliveries between Europe and Russia as part of Beijing’s Belt and Road Initiative.
The company’s rail delivery volume in China posted a 60 percent annual gain, it said.
The company would continue to expand its logistics and customs clearing capabilities in China to position itself as a one-stop shop for business-to-business and business-to-consumer businesses in the region, as well as expand its presence among e-commerce operators in Asia and Europe.
T-Cube Global Logistics Co Ltd (聯宇達方), the company’s Shanghai-based subsidiary providing warehousing and delivery services for global brands importing to China, is expected to see lower operating expenses as it shifts costly “last-mile” deliveries to local contractors, T3EX said.
Most notably, T3EX has set its sights on providing supply chain financing for its Chinese customers, many of whom have limited access to credit from local banks, but have established a good track record from their relationship with the company.
The company is finalizing its list of candidates for its supply chain finance business, which could begin operating as soon as the beginning of the second half of the year.
Meanwhile, the company said that Shanghai EXer Logistics Co Ltd (上海賽澳遞物流), its majority-owned e-commerce warehousing subsidiary, is expected to return to the black this year, after its losses last year caused its parent company’s earnings per share performance to drop by NT$0.8.
T3EX has scaled back its Shanghai-based unit and cut a number of loss-making operating locations, and said that the freight and logistics license held by the subsidiary remains a vital asset for future growth.
“Becoming a one-stop shop for logistic services would allow the company to reap profits at each step of the delivery,” T3EX chairman and president David Yen (顏益財) said.
While margins had dropped from 18.41 percent in 2016 to 18.26 percent last year, Yen said that the company would focus on improving profitability as opposed to scale.
T3EX reported that net income last year rose to NT$252.73 million (US$8.67 million), compared with NT$121.18 million a year ago. Earnings per share were NT$2.07.
Sales rose 8.14 percent to NT$10.54 billion.
The company also announced that it would distribute a cash dividend of NT$1.3 per share.
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