Aramex Pjsc · DFM:ARMX
Aramex Pjsc — Aramex — Q3 2018 Earnings Presentation
36 slides from Aramex Pjsc's earnings presentation, 2018
Slide 1: Investors Presentation Q3 2018 Results
Investors Presentation Q3 2018 Results Management Update | Q3 2018 Results | Long Term Performance | Management Outlook
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Disclaimer Cautionary Note Regarding Forward-Looking Statements This presentation has been prepared solely for informational purposes. The presentation may contain forward looking statements, which reflect our beliefs or current expectations and assumptions regarding the future of the business, futu
Slide 3: Management Update
Management Update Management Update | Q3 2018 Results | Long Term Performance | Management Outlook | Investor Presentation
Slide 4: Aramex is a Global Provider of Logistics and Transportation Solutions
Aramex Overview Aramex is a Global Provider of Logistics and Transportation Solutions 16,725 Employees | 600+ Office in 70+ Countries | AED 3.7 Billion Revenues | AED 5.9 Billion Market Cap Domestic International Logistics Freight E-Commerce Express Express & Other We understand that With Aramex Whe
Slide 5: Aramex Shareholders were Rewarded by Good TSR
Shareholder Returns Aramex Shareholders were Rewarded by Good TSR Closing Price Q3 2018 Market Capitalization (AEDm) AED 4.04 7,000 6,000 5,959 6,296 5,915 5,000 4,451 4,539 4,627 Total Return Metrics 4,000 3,045 2,928 3,000 2,635 -6.05% 2,000 2,090 679 YTD 2018 share price 1,000 92 239 increase and
Slide 6: Management Expects to Deliver on 2018 Revenue Targets
Outlook & Guidance Management Expects to Deliver on 2018 Revenue Targets 2017 Actual 2018 Target 9M 2018 Actual Express ↑ 19% AED 2,006 m Double-digit growth ↑ 12% AED 1,571 m Freight Forwarding ↑ 2% AED 1,157 m Single-digit growth ↑ 2% AED 871 m Domestic ↑ 4% AED 1,022 m Single-digit growth ↑ 4% AE
Slide 7: Management Focused on Four Key Areas to Drive 2018 Results
Key Messages Management Focused on Four Key Areas to Drive 2018 Results Focus Area Management Remains Focused on Long-Term Growth Drivers Continues to be the main growth driver of Aramex express and logistics eCommerce businesses Asset-light model Proves our business model can be successful through
Slide 8: Management Remains Focused on Three Key Priorities
Management Priorities Management Remains Focused on Three Key Priorities Expand Footprint Develop & define our stronghold in GCC & Levant Expand Aramex presence in Asia Pacific and Africa Globalize the Aramex brand in emerging markets | Investor Presentation
Slide 9: Management Remains Focused on Three Key Priorities
Management Priorities Management Remains Focused on Three Key Priorities Expand Footprint Leverage Infrastructure Develop & define our stronghold in Grow eCommerce business GCC & Levant Expand Aramex presence in Asia Integrate supply chain management Pacific and Africa solutions and value added serv
Slide 10: Management Remains Focused on Three Key Priorities
Management Priorities Management Remains Focused on Three Key Priorities Expand Footprint Leverage Infrastructure Organic Growth Develop & define our stronghold in Continue to deliver operational Grow eCommerce business GCC & Levant excellence Accelerate organic expansion Expand Aramex presence in A
Slide 11: We Believe in Transforming our Business to Succeed in a Digital World
Core Beliefs We Believe in Transforming our Business to Succeed in a Digital World Business Model Disruption We believe that the current logistics model will not last All the way from bulk to containers to pallets to boxes to pieces – new industry Shipping is changing dynamics apply to all players i
Slide 12: Q3 2018 Results
Q3 2018 Results Management Update | Q3 2018 Results | Long Term Performance | Management Outlook | Investor Presentation
Slide 13: Strong Top and Bottom Line Performance
Financial Performance Strong Top and Bottom Line Performance Performance across key indicators Q3 2018 Results (AED) 1,323,973 1,231,913 1,239,108 1,143,399 1,189,632 Revenues 8% growth compared to Q3 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 237,023 190,212 178,073 134,648 164,626 EBITDA 32% yea
Slide 14: Q3 2018 Group Highlights
Financial & Performance Q3 2018 Group Highlights Highlights Management Comments Revenue (AED m) Cost of Revenues (AED m) 1,232 1,239 -569 -563 • Revenue growth in Q3 2018 was 1,143 contributed by most of our -531 regions, supported by the strong growth of cross-boarder Q3 2017 Q2 2018 Q3 2018 Q3 201
Slide 15: Q3 2018 Financial Highlights
Financial Performance & Q3 2018 Financial Highlights Highlights Income Statement (AEDm) Quarter Movement (%) Q3 2018 Q2 2018 Q3 2017 q-o-q y-o-y Revenue 1,239 1,232 1,143 1% 8% Cost of Revenue (569) (563) (531) -1% -7% Gross Profit 671 669 613 0% 9% Overheads (527) (510) (504) -3% -5% Profit for the
Slide 16: International Express and Domestic delivered 64% of revenues
Financial Performance & International Express and Domestic delivered 64% of revenues Highlights Revenues by Segment (AED m) Y-o-Y Growth 18% 2% -3% 14% 6% Other Logistics 5% 6% 83 4 1,239 6 -7 9 1,143 Domestic 21% Express 44% Q3 2018 Freight Forwarding 24% Q3 2017 Express Freight Domestic Logistics
Slide 17: Geographic Performance – Strongest Growth Recorded in Middle East & Africa
Financial Performance & Geographic Performance – Strongest Growth Recorded in Middle East & Africa Highlights Revenues by Geography Y-o-Y Growth 9% -1% 2% 13% 1,239 1,250 62 -2 1 35 1,143 Asia and Others 1,000 25% 750 North America Q3 2018 Middle East 3% & Africa 61% 500 Europe 11% 250 - Q3 2017 Mid
Slide 18: Q3 2018 Financial Highlights
Financial Performance & Q3 2018 Financial Highlights Highlights Financial Ratios (AEDm) Movement (%) Q3 2018 Q2 2018 Q3 2017 q-o-q y-o-y EPS (AED) 0.077 0.084 0.056 -8% 38% Gross Profit Margin % 54.1% 54.3% 53.6% -0.2% 0.5% Net Profit Margin % 9.1% 9.9% 7.1% -0.8% 2.0% EBITDA Margin % 14.4% 15.4% 11
Slide 19: Balance Sheet Remains Strong and Liquid
Financial Performance & Balance Sheet Remains Strong and Liquid Highlights Balance Sheet Highlights Asset Movement Y-o-Y (AED m) Movement Current Assets Non-Current Assets 30 Sep 2018 31 Dec 2017 Actual Change % 57 10 0 33 4,590 4,404 -57 143 Current assets 2,054 1,911 143 7% Non-current assets 2,53
Slide 20: Composition of Assets
Financial Performance & Composition of Assets Highlights Financial Ratios (AEDm) Movement 30 Sep 2018 31 Dec 2017 Actual in % Cash and cash equivalents 671 728 -57 -8% Receivables (net) 1,077 934 143 15% Other current assets 306 250 56 22% Total current assets 2,054 1,911 143 7.4% Property, Plant an
Slide 21: Long Term Performance
Long Term Performance Management Update | Q3 2018 Results | Long Term Performance | Management Outlook | Investor Presentation
Slide 22: Evolution of Express Business – Outgrowing Freight Forwarding
Financial Performance & Evolution of Express Business – Outgrowing Freight Forwarding Highlights Y-o-Y Total Segmental Revenues (%) Revenue Growth 8% 10% 3% 16% 9% 100% Express contribution to total revenues 11% 12% 11% 12% 13% 11% 12% continues to grow, outgrowing all other businesses 80% 25% 24% 2
Slide 23: Aramex Maintains a Track Record of Delivering Operational Excellence
Long Term Performance Aramex Maintains a Track Record of Delivering Operational Excellence Aramex 2012 - 2017 (indexed) We delivered a consistently strong performance since 2012 2012 - 2017 CAGR Revenues 9.0% Cost of Revenues 8.8% EBITDA: 12.5% 2012 2013 2014 2015 2016 2017 CoR Revenue EBITDA | Inve
Slide 24: Aramex Continues to Deliver Solid Top Line Performance
Long Term Performance Aramex Continues to Deliver Solid Top Line Performance Revenues (AEDm) 6,000 • Revenue growth of 9% in 2017. CAGR 5,000 9% 4,721 4,343 • Revenue growth reflects additional 4,000 3,643 3,755 income generated primarily in international 3,321 cross border express business as well
Slide 25: Strong Underlying Results Right Across the Business
Long Term Performance Strong Underlying Results Right Across the Business CAGR EBITDA Before Special Items (AED m) 12.5% EBITDA before special items: 700 665 Aramex generated strong underlying results across the business 584 600 511 500 465 431 400 368 300 200 100 - 2012 2013 2014 2015 2016 2017 *Sp
Slide 26: Aramex Generates Consistent Performance Across Key KPIs
Long Term Performance Aramex Generates Consistent Performance Across Key KPIs EBITDA Margin (%) Net Profit Margin (%) Return on Equity (%) 16.0% 12.0% 20.0% 18.8% 14.6% 14.1% 18.0% 17.4% 14.0% 13.6% 13.5% 13.0% 9.8% 12.8% 10.0% 9.2% 9.3% 16.0% 12.0% 14.7% 12.0% 8.7% 14.4% 8.4% 8.3% 7.9% 14.0% 13.3%
Slide 27: Key Components of Aramex's Long Term Growth Story
Long Term Performance Key Components of Aramex’s Long Term Growth Story Contribution by Business (AED m) 2012-2017 5,000 4,721 Growth story since 2012 122 72 4,500 -12 429 4,000 CAGR Express 15.7% 3,500 3,072 1,038 3,000 CAGR Freight Forwarding -0.2% 2,500 2,000 CAGR Domestic 11.5% 1,500 1,000 CAGR
Slide 28: Defending and Developing our Market Position in Growth Markets
Long Term Performance Defending and Developing our Market Position in Growth Markets Contribution by Geography (AED m) 2012-2017 5,000 4,721 Growth story since 2012 899 4,500 4,000 69 607 74 CAGR Middle East 4.9% 3,500 3,072 3,000 CAGR Europe 2.8% 2,500 2,000 CAGR North America 15.3% 1,500 1,000 CAG
Slide 29: Aramex Balance Sheet Evolution
Long Term Performance Aramex Balance Sheet Evolution Debt/Equity% Total Assets (AED m) 5,000 50% 4,590 Aramex has consistently grown its balance 4,404 4,500 45% sheet. 3,974 4,000 40% 3,445 3,500 3,207 35% Driven mainly by acquisitions, Aramex will 2,986 continue to increase leverage. 3,000 27.7% 30
Slide 30: Aramex Management Proposes to Pay a Dividend of AED 0.163 for 2017
Value Creation Aramex Management Proposes to Pay a Dividend of AED 0.163 for 2017 Dividend Payout (AED/share) Dividend Payout Ratio (%) Dividends 0.163 0.160 Dividend proposal of AED 0.163 per 0.150 70.5% * share was approved by shareholders 0.140 at AGM on 8 April 2018 60.0% 60.6% 64.4% 54.9%** 54.
Slide 31: Aramex Shareholders are Rewarded by Long Term Performance
Long Term Performance Aramex Shareholders are Rewarded by Long Term Performance Performance (Jan 2012 - Sep 2018) Total Return 13.90% 53.90% 8.60% 6.50% 33.50% 8.90% Share price change: 124.44% 6 Annualized return: 12.70% 5 4 Total return 178.52% (dividends reinvested): 3 Annualized total return: 16
Slide 32: Management Outlook
Management Outlook Management Update | Q3 2018 Results | Long Term Performance | Management Outlook | Investor Presentation
Slide 33: The Way Forward: Management Priorities
Outlook & Guidance The Way Forward: Management Priorities Grow the Business Consistent Profitability Shareholder Participation Continue with our progressive Focus on innovation and technology Focus on operational excellence dividend policy Grow eCommerce Portfolio Variabilization of cost structure T
Slide 34: Management Ambition: Guidance
Outlook & Guidance Management Ambition: Guidance 2016 Actual 2017 Actual 2018 Targets Express ↑ 22% AED 1,687 m ↑ 19% AED 2,006 m Double-digit growth Freight Forwarding ↓ 6% AED 1,131 m ↑ 2% AED 1,157 m Single-digit growth Domestic ↑ 35% AED 981 m ↑ 4% AED 1,022 m Single-digit growth Logistics ↑ 29%
Slide 35: Long Term Ambition Level – Projected Roadmap to 2020
Outlook & Guidance Long Term Ambition Level – Projected Roadmap to 2020 4,721 4,343 3,643 3,755 3,321 3,072 626 665 368 431 465 465 2012 2013 2014 2015 2016 2017 2018E 2019E 2020E Revenue EBITDA | Investor Presentation
Slide 36: Aramex Investor Relations Contacts
Aramex Investor Relations Contacts Bashar Obeid Nadia Abu Sarah Iyad Kamal Mohammad Al Qassem CEO CFO COO Investor Relations Investor Relations: InvestorRelations@aramex.com Tel +971 4 211 8464 P.O. Box Dubai – UAE www.aramex.com/investors | Investor Presentation