Agility reports KD16.1m net profit for Q2 2022, revenue grows 23.4% to KD138.4m

Agility, the Kuwait-headquartered operator and long-term investor in supply chain services, infrastructure and innovation, reported H1 2022 earnings of 11.41 fils per share on a net profit of KD28.8m. Profits from continuing operations, which exclude performance of the GIL business sold by Agility in 2021, increased 71.5 per cent from KD16.8m to KD28.8m. Earnings before interest, taxes, depreciation, and amortisation (EBITDA) increased 21.5 per cent to KD71m, and revenue grew 22.9 per cent to KD270.5m.

For the second quarter, Agility reported earnings of 6.35 fils per share on a net profit of KD16.1m. Net profits from continuing operations increased 2 per cent from the same period last year while EBITDA was KD37 million, a decline of 4.1 per cent. Adjusted EBITDA, for non-recurring items in both quarters, showed an increase of 8.6 per cent. Revenue grew 23.4 per cent to KD138.4m.

Q2 2022 performance highlights
Agility vice chairman Tarek Sultan said: “Agility continues to deliver good results amid challenging market and geopolitical conditions. Our owned and operated, or controlled businesses reported year-over-year growth, and we expect continued growth and performance in our operations in 2022. Our goal is to grow these businesses further. The Menzies acquisition, which we concluded earlier this month, is a good example of this growth strategy.

“When it comes to Agility’s portfolio of investments, our largest investment, DSV, continues to be impacted by market performance. That said, Agility is a strategic and long-term investor, with deep supply chain expertise in our own right. We believe in the long-term potential of freight forwarding and transportation, as well as the other sectors we have invested in.”

Agility-controlled businesses
For Q2, this segment reported revenue of KD138.4m and EBITDA of KD39.8m, with increases of 23.4 per cent and 9.2 per cent, respectively.

Agility Logistics Parks (ALP) revenue in the second quarter of 2022 grew 2 per cent versus Q2 2021. To meet the increasing demand for warehousing space, ALP is optimising its existing land bank and looking to acquire additional land for development, especially in the Middle East and Africa regions.

Tristar, a fully integrated liquid logistics company, posted a 23.8 per cent increase in revenue in Q2 2022. This growth was driven by strong performance of maritime sector and turnkey Fuel business.

National Aviation Services (NAS) reported a 40.1 per cent year-over-year revenue increase. The increase reflects the broad recovery in commercial aviation as flights, passengers and cargo volumes grew in most of the countries where NAS operates. In addition, NAS created significant value from operations in some of its newer markets.

On August 4, Agility finalised its acquisition of UK-based John Menzies and will combine Menzies with its National Aviation Services (NAS) business to create a world leader in aviation services, operating in 58 countries. Menzies’ financial performance will be consolidated with Agility’s group financials starting from the acquisition date. The enterprise value of the acquisition was £763m. Menzies and NAS will be combined into a single entity that will do business under the Menzies name.  Performance of the new, combined entity will be reported within Agility’s controlled business segment.

Read: Kuwait-based Agility completes £763m acquisition of Menzies Aviation

United Projects for Aviation Services Company reported a 35.7 per cent increase in Q2 2022 revenue, primarily due to a rebound in airport-related services and parking following the phased reopening of Kuwait International Airport. Flight and passenger volumes have grown since the relaxation of COVID restrictions by the government of Kuwait. UPAC anticipates a gradual increase in airport traffic in 2022 and beyond.

UPAC is a co-investor in Abu Dhabi’s Reem Mall, on Reem Island. Construction is nearly complete. The retail, entertainment, and leisure attraction is expected to open in 2022.  Carrefour, the anchor tenant, recently opened its doors at Reem Mall.

At Global Clearinghouse Systems Agility’s customs-modernisation company, Q2 2022 revenue grew 10.5 per cent from second quarter 2021. The increase was driven by higher trade volumes and company growth initiatives. GCS is still pursuing opportunities to increase future growth and diversify its sources of income.

Agility’s investments
Agility holds minority stakes in a number of businesses, both listed and non-listed, with a carrying value of around KD1.4bn. The largest investment in this portfolio is DSV. The other investments in the portfolio span a number of sectors including: freight, real estate, e-commerce enablement, ESG and supply chain technologies.

Global equity markets remain volatile as the result of supply chain disruption, high energy prices political instability, and other challenges that affect the day-to-day valuation of Agility’s investments.