Lower forex, hedging gains pull LBC profit down
Logistics group LBC Express Holdings saw a 52-percent year-on-year decline in six-month attributable net profit to P561.88 million as gains on foreign exchange and hedging tools fell while interest and depreciation expenses increased.
Net income from core operation for the first six months, however, increased by 10 percent year-on-year to P798.71 million.
In a regulatory filing, LBC said its service revenue rose by 36 percent year-on-year to P7.85 billion for the six-month period. This was due mainly to the increase in revenues from both the logistics and remittance segments, which went up by 27 percent and 11 percent, respectively.
The total retail segment of the business grew by 43 percent, with retail logistics rising by 50 percent. Corporate logistics and money remittance grew by 22 percent, with the corporate segment accounting for a 231-percent increase.
The domestic business grew revenue by 20 percent year-on-year, boosted by the opening of 75 retail branches from the same period last year.
On the other hand, the company’s net profit was curbed by the P410.94-million decline in gain on derivatives alongside the P125.8-million slowdown in foreign exchange gain.
Cost of service also went up by 39 percent year-on-year to P5.3 billion in the first six months on higher overhead expenses alongside higher depreciation and amortization expenses.
The first-time adoption of Philippine Financial Reporting Standard 16 jacked up the company’s depreciation and interest expenses as this new system reclassified leased vehicles under finance leases to right of use assets.
LBC also recognized a net loss from one of the acquired entities in 2018 amounting to P206.61 million.
Moving forward, LBC said operational systems would continue to be improved to support growing volumes. Initiatives include re-fleeting, warehouse expansions, branch expansion, and an enterprise-wide digital transformation.
“By expanding our remittance services, we are able to assist customers in far-flung areas, and participate in this effort of the BSP. LBC has always been looking toward better assistance for all customers from all over the country, and across the globe,” he added. —DORIS DUMLAO-ABADILLA
