LBC Express Holdings, Inc. (LEHI) reported a net income of P7.572 million in the first quarter of 2019, a 99% drop from P570.563 million posted in the same period last year.
Total comprehensive income also fell 91% to P48.932 million in the first three months of 2019 from P550.113 million in the same quarter last year, LEHI disclosed to the Philippine Stock Exchange.
The company said the lower net income was due to loss on derivative attributable to the convertible instrument amounting to P169 million, net loss from one of the acquired entities in 2018, and lower foreign exchange gain, among others.
Revenues during the period increased 37% to P3.755 billion compared with the P2.749 billion posted in the first quarter of 2018. The growth, LEHI said, was mainly due to the increases in revenue from the company’s logistics segment, attributable to escalation in both retail and corporate sales by 48% and 28%, respectively. Moreover, acquisitions made in 2018 contributed to net revenue amounting to P664.13 million or 66% of the total growth.
The company’s domestic business also contributed to growth, as 73 additional retail branches opened and new products were introduced in mid-2018. Improvements in the corporate/institutional business segment expanded its e-commerce-directed logistics and warehousing services, while the growth of corporate/institutional accounts was likewise maintained.
Cost of services was higher by 45% to P2.638 billion in the first quarter from P1.819 billion previously, relative to the growth of volume in logistics services. Direct cost was also significantly affected by the increase in fuel rates, which inclined carriers, mainly outsourced airlines and truckers, to enforce rate increases during the quarter. Related cost of sales of newly acquired entities amounted to P620.62 million, or 74% of the total increase during the quarter.
Operating expenses were also higher by 56% to P728.08 million from P466.15 million.
As of end-December, LEHI offers logistics services from 1,397 company-owned branches in the Philippines and 71 company- and affiliate-owned branches in 22 countries and territories worldwide.
It has also heavily invested in a three-year digital transformation program to further automate its processes and respond to changes in the logistics industry.
