Imperial Logistics’ continued expansion of its African footprint has contributed to annual financial results marked by operating profit growth, improved operating margins and the delivery of strong revenue in a testing economic climate.
Chief business development officer Cobus Rossouw reports that the logistics and supply chain leader’s Africa division was the standout performer in the past financial year, achieving total revenue growth of 15% to R25.4 billion.
“Imperial Logistics Africa’s operating profit increased 25% to R1 587-million and operating margins improved from 5.75% to 6.26%,” he reveals.
In South Africa, Imperial Logistics continued to perform satisfactorily delivering improved margins and benefitting from operating efficiencies and its leading market position, Rossouw states. He explains that while the flipside of streamlining clients’ supply chains and optimising their logistics operations is often reduced income for logistics and transport providers, Imperial is well positioned to counter this paradox.
“The South African business remains strategically well placed to focus on service expansion opportunities to offset revenue decline resulting from efficiency gains. We will continue to grow and deliver client value through an on-going strategy of leveraging opportunities inherent in new industries and new capabilities,” he says.
Expanding on the performance of Imperial Logistics’ operations in the rest of Africa, Rossouw says their continued positive impact on Imperial’s overall performance was founded on volume growth and the contribution of strategically aligned acquisitions in the pharmaceuticals sector.
“Bearing fruit in this sector is our acquisition of a majority stake in Dutch pharmaceutical wholesaler Imres, along with the Eco Health and MDS businesses which we acquired during the previous financial year.”
Imperial’s acquisition of Nigerian logistics company MDS and pharmaceutical distributor Eco Health gave the group third party logistics capabilities in Nigeria and Ghana, and it is now reaping the benefits of this strategy.
The group’s competitive position continued to strengthen across both the regions and industries in which it operates, with many major contracts renewed. “In many such cases,” Rossouw explains, “these contracts now incorporate an expanded scope of services – with greater Imperial participation in the client’s end-to-end supply chain.”
“Our commitment to our clients’ competiveness remains unwavering,” Rossouw affirms, “and we will continue to work alongside them as we jointly navigate a particularly tough trading environment.”
Looking ahead, he says Imperial Logistics will continue to drive its growth strategies in order to firmly establish itself as a leading logistics provider in sub-Saharan Africa. “We anticipate challenging economic conditions in South Africa over the medium term, but aim to capitalise on growth in the consumer environment in the rest of Africa. Our Africa operations are expected to continue performing well,” he says.