LBC Express Holdings, Inc. posted a net income of P1.196 billion in the first six months of 2018, a 170% jump from P442.702 million earned in the same period last year.
In a disclosure to the Philippine Stock Exchange, LBC said the positive performance was due to higher revenues as a result of increase in volume, reduction in operating expense, gain on derivative, and the increase in unrealized foreign exchange gain related to valuation of dollar-denominated cash and cash equivalents.
Service revenues rose 18% to P5.783 billion in the first half of the year from P4.910 billion for the same period last year, mostly from growth in both retail and corporate logistics sales by 18% and 29%, respectively.
LBC also acquired one domestic and six overseas entities during the period which contributed 2% to the total logistics revenue, which grew 19% to P5.194 million from P4.364 million.
The higher logistics revenue was mainly powered by growth in volume attributable to the company’s horizontal growth, following the addition of 60 branches in the Philippines. Branches in the Middle East also introduced their local courier services which brought higher sales.
LBC said there is also continuous growth of large enterprise and small and medium-entity clients which contributed to a 26% share in logistics revenue for the period in review.
Cost of services was higher by 18% to P3.819 billion from P3.243 billion relative to growth of volume in logistics services, resulting in higher cost of delivery and remittance by 26%.
Additional branches and warehouses to cover higher volume contributed to increased rental and utilities and supplies by 15% and 18%, respectively. The continuous expansion and increase in domestic motorcycle fleet in the latter part of 2017 spiked depreciation by 24%.
LBC said the Tax Reform for Acceleration and Inclusion or TRAIN Law, which took effect on January 1, 2018, also impacted expenses related to delivery, fuel and manpower cost.
Operating expenses, meanwhile, are lower by 4% to P996 million from P1.042 billion with the discontinuation of the royalty fee and decline of professional fee mostly attributable to consultancy fees related to process improvement.
LBC is steadily expanding both its domestic and global reach. Oversees, it operates in more than 20 countries with a network of over 1,200 branches and a pool of 5,300 partner agents.
In the Philippines, it operates three main hubs for sea cargo in Manila, Clark, and Cagayan De Oro. It runs 78 delivery hubs, managing a team of 1,410 delivery associates and over 6,000 employees across the country.
LBC has also heavily invested in its three-year digital transformation program to further automate its processes and respond to changes in the logistics industry.
