Kerry Logistics Network Limited has announced the Group's annual results for 2020. KLN Group's IL division recorded a normalised segment profit growth of 8% in 2020, mainly driven by the strong performance in Hong Kong and Taiwan.
Group's Financial Highlights
- Revenue increased by 30% to HK$53,361 million (2019: HK$41,139 million)
- Core operating profit increased by 20% to HK$3,320 million (2019: HK$2,765 million)
- Core net profit increased by 33% to HK$1,828 million (2019: HK$1,374 million)
- Profit attributable to the Shareholders for 2020 was HK$2,896 million. Excluding the gain from disposal of two warehouses in Hong Kong in 2019, it represents a remarkable year-on-year growth of 58% (2019 normalised: HK$1,830 million)
- Integrated Logistics (IL) business recorded a segment profit of HK$2,583 million (2019: HK$2,435 million), which represents an increase of 6%. The growth in IL segment profit was affected by the reduced profit contributed by lesser number of warehouses in Hong Kong compared with 2019. Should this impact be normalised, segment profit of IL business should have increased by 8%
- International Freight Forwarding (IFF) business recorded a 64% increase in segment profit to HK$1,017 million (2019: HK$622 million)
- Proposed final dividend of 23.8 HK cents per share, to be payable on Friday, 11 June 2021
In Hong Kong, the IL division grew by 10% in 2020, benefitting from the rise in demand for home-delivered daily necessities, electronic goods and pharmaceutical logistics. The Hong Kong warehouse business contracted in 2020 compared with 2019 mainly due to the disposal of two warehouses in 2019 1H.
In Mainland China, the segment profit for the IL division bounced back in 2020 2H, offsetting the 37% drop in 2020 1H. This was due to the resumption of manufacturing activities, recovery of local consumption and the rapid growth of the e-commerce market in Mainland China.
In Taiwan, the IL business expanded by 19% year-on-year in segment profit, capitalising on the growth of semi-conductors and electronics manufacturing, the increasing demand in pharmaceutical logistics as well as the rise in e-commerce business. The robust performance of Science Park Logistics' bonded operations was another driver for its growth.
In Asia, the IL business sustained despite severe lockdowns across the region, driven by the switch from consumer goods business to the essential supply sectors. The Group expanded its express business to the Philippines through the establishment of a joint venture company in 2021 Q1 in which the Group has a 51% interest.
William MA, Group Managing Director of KLN Group, said, "The COVID-19 pandemic has brought unprecedented challenges to everything from global public health to people's livelihoods. The stop-and-go momentum of the global economy has caused severe disruption to the global supply chain. With human mobility severely curtailed, the role of logistics has become ever more paramount. Every link in the supply chain from sourcing and manufacturing to the distribution of finished products must still be maintained. Even as the pandemic forced millions of corporate employees around the world to work from home, our teams have been working tirelessly on the frontline, maintaining 24/7 services across some 150 international hubs to support various industries and sustain people's daily lives. In 2020, thanks to the collective efforts of our colleagues and business partners, KLN Group achieved record growth in both revenue and core net profit, clearly demonstrating the Group's resilience and capability to evolve through the pandemic."