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LBC Express net income plunged 69% in the first quarter
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Increased air freight cost and higher fuel prices dragged the group’s performance
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Service revenue declined 9% in the first quarter
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Cost of services were down by 5% largely from reduction in cost of delivery and remittance
LBC Express Holdings, Inc.’s (LBCEHI) net income plunged 69% in the first quarter of 2022 to P43.76 million from P141.88 million due to increased air freight cost and higher fuel prices.
Service revenue declined 9% to P3.957 billion for the first three months of the year from P4.356 billion year-on-year, the company said in a regulatory disclosure. Revenue from corporate clients dropped 11%.
After the nationwide community quarantines in 2020 and 2021, retail sales surged due to increase in demand, continuing up to the first quarter of last year.
Steady growth in air cargo volume and rate alignment in some countries boosted sales from overseas by 10%.
READ: LBC Express to get P2B funding to pay off obligations, taxes
Cost of services were down by 5% to P3.054 billion from P3.198 billion largely from reduction in cost of delivery and remittance by 12%, relative to lower volume and improved productivity and reduced cost of contractual employees. This was partially offset by the surge in cost of air freight as a consequence of higher air freight and fuel prices.
LBCEHI last year said the group embarked on a recovery plan focused mainly on rebalancing and repositioning services toward new consumer needs and behaviors. It also aims to rapidly innovate its services and capabilities to leverage the accelerated shift of consumers to e-commerce.
As a result, the group has been expediting its digital services for both retail and corporate customers.
LBCEHI has a network of over 1,500 branches in the Philippines, over 300 hubs and warehouses, and partners and agents in over 30 countries.
