Listed 2GO Group, Inc. swung to a net profit of P227 million in 2013 from a loss of P356 million in 2012, following a combined business expansion and realization of efficiencies from its integration with parent Negros Navigation Co. Inc. (NENACO).
Revenues, however, fell 2% to P13.373 billion from P13.654 billion mainly due to the reduction in capacity of the group’s shipping business as a result of fewer operating vessels in 2013 as most of its ships underwent drydocking, 2GO disclosed to the Philippine Stock Exchange.
Its freight and passage businesses declined 17% and 3% year-on-year, respectively.
Freight revenue was P4.892 billion, down from P5.881 billion in 2012, while passenger revenue declined to P3.108 billion from P3.190 billion.
The group’s non-shipping business, largely logistics and supply chain solutions, rebounded by 33% as a result of “various service upgrade initiatives and deliberate focus on key domestic and international accounts.”
Cost and expenses were down 5% to P12.883 billion from P13.532 billion.
2GO noted that “the group has transformed itself into the largest supply chain enterprise in the country today”, citing its numerous end-to-end total logistics embodied in its three main units, namely, Logistics Express Distribution (LED); shipping and passage; and international logistics.
2GO integrated with Negros Navigation in December 2010 when the major stockholders of the former sold their shareholdings to NENACO.
With most of the major integration targets and the groundwork now in place, 2GO said it is “optimistic that the positive performance of the group will be sustainable in ensuing years.”
Among the group’s strategy are continued fleet and route rationalization for the shipping business; comprehensive review and implementation of cost-saving initiatives, including that of the One Port project; and implementing a more robust management reporting system to closely monitor financial results and operating performance.
The group’s intention, 2GO added, is for its shipping business to transform into its new role as an “enabler” that will propel its non-shipping business to desired growth levels.
The group is currently beefing up its fleet to regain lost capacity in 2013.
Photo from www.2go.com.ph
