KLN Logistics Group (636) H1 2024 earnings summary

Executive summary

• Revenue increased 10% year-over-year to HK$25,432 million for the first half of 2024, with core operating profit up 11% to HK$1,200 million and core net profit up 5% to HK$606 million.

• Profit attributable to shareholders surged 126% year-over-year to HK$831 million, driven by gains from discontinued operations and strategic realignment.

• The group distributed its entire stake in KEX Express Thailand as a special dividend, ceasing its subsidiary status and certain express operations in Asia.

Financial highlights

• Revenue: HK$25,432 million, up from HK$23,197 million year-over-year.

• Core operating profit: HK$1,200 million, up from HK$1,078 million; core net profit: HK$606 million, up from HK$575 million.

• Profit attributable to shareholders: HK$831 million, up from HK$368 million, driven by discontinued operations' profit.

• Interim dividend declared at 10 HK cents per share, payable on or around 23 September 2024.

• Gross margin improved as gross profit rose to HK$2,518 million from HK$2,433 million year-over-year.

Outlook and guidance

• Management remains optimistic for FY2024, with IFF division expected to benefit from sustained demand, higher yields, and anticipated strong air freight in Q4.

• Focus on cross-selling between Integrated Logistics (IL) and International Freight Forwarding (IFF) divisions, cost control, digitalisation, automation, and sustainable logistics solutions.