{"id":70529,"date":"2023-05-16T13:16:39","date_gmt":"2023-05-16T10:16:39","guid":{"rendered":"https:\/\/indexeconomic.com\/?p=70529"},"modified":"2023-05-16T13:16:39","modified_gmt":"2023-05-16T10:16:39","slug":"agility-reports-kd-15-3-million-net-profit-for-the-first-quarter-2023","status":"publish","type":"post","link":"https:\/\/indexeconomic.com\/?p=70529","title":{"rendered":"Agility Reports KD 15.3 Million Net Profit for the First Quarter 2023\u00a0"},"content":{"rendered":"\n

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\u2013 Agility<\/a>, a long-term investor and operator in supply chain services, infrastructure, and innovation, today reported first quarter 2023 earnings of KD 15.3 million, or 6 fils per share, an increase of 20% over the same period in 2022. Agility\u2019s EBITDA increased 78.1% to KD 60.4 million and revenue grew 142.7% to KD 320.5 million.\u00a0\u00a0\u00a0<\/p>\n\n\n\n

On a like-for-like basis — excluding the performance of Menzies Aviation and HG Storage International, which were acquired in August 2022 — Agility\u2019s EBITDA increased 30% to KD 44 million, and revenue grew 17%.  <\/p>\n\n\n\n

Q1 2023 Performance<\/strong> <\/p>\n\n\n\n

Agility Vice Chairman Tarek Sultan said: \u201cAgility\u2019s first quarter results reflect the healthy growth in our controlled businesses. Two of our large 2022 acquisitions \u2013 Menzies and HG Storage International \u2013 contributed to Q1 earnings for the first time.  <\/p>\n\n\n\n

On the investment side, equity markets improved in Q1 which was reflected in our investments. That said, we continue to look beyond short-term movement in equity markets, focusing instead on the strategic value, growth and returns that these investments can deliver for our shareholders over the long term. <\/p>\n\n\n\n

Like all global businesses, we view ongoing inflation, high interest rates, currency volatility and other factors as reasons for continued caution about the near-term economic outlook. We are also closely watching the Kuwait land contracts issue.   <\/p>\n\n\n\n

Even so, we are excited by the strategic transformation that has taken place in Agility since 2021. We believe we are positioned to grow and drive value for our shareholders, customers, employees and communities as we evolve further.\u201d  <\/p>\n\n\n\n

Agility Controlled Businesses <\/strong> <\/p>\n\n\n\n

Agility\u2019s controlled businesses are the businesses the company controls and operates and whose performance is consolidated and reported through Agility\u2019s profit and loss statement. In Q1, the combined EBITDA of our controlled businesses was KD 56.8 million on revenue of KD 320.5 million, increases of 55% and 142.5%, respectively, over Q1 2022.  <\/p>\n\n\n\n

Performance of the company\u2019s controlled businesses is reported under three groups: <\/p>\n\n\n\n

Aviation Services<\/strong> <\/p>\n\n\n\n

Menzies Aviation\u2019s revenue was KD 154.4 million in Q1 2023, and EBITDA KD 20.2 million for the same period. These Q1 results include the results of Menzies Aviation, acquired in Q3 of 2022, and the legacy National Aviation Services (NAS) business, now combined with Menzies.  Agility\u2019s aviation services results for Q1 2023 represent an 816.5% increase in revenue relative to Q1 2022, when Agility was reporting solely on NAS\u2019s results. The combined entity\u2019s EBITDA margin is 13.1% today.  <\/p>\n\n\n\n

There was a broader underlying recovery in aviation volumes in Q1 2023 compared with Q1 2022. In the first quarter of 2023, ground handling volumes and fueling volumes grew, offsetting declines in cargo volumes and revenue relative to Q1 2022.  <\/p>\n\n\n\n

The consolidation of Menzies and NAS has resulted in a larger global company with operations in more locations.  <\/p>\n\n\n\n

Fuel Logistics <\/strong> <\/p>\n\n\n\n

Tristar\u2019s Q1 consolidated revenue grew 85.5% vs. Q1 a year earlier. EBITDA increased 29.2% in Q1, driven mainly by growth in the Maritime and Fuel Farms segments. Tristar acquired a 51% ownership stake in HG Storage International (trading as Aquarius Energy) at the end of August 2022. Tristar\u2019s growth can be attributed to the addition of HG Storage International; renewal of two large long-term peacekeeping contracts that make Tristar the No. 1 supplier to the UN  (as listed on UN procurement website); and the booming maritime business. Tristar remains focused on growing and deepening relationship with its blue-chip clients and is positioned to deliver sustainable, long-term value to shareholders. <\/p>\n\n\n\n

Other Controlled Businesses <\/strong> <\/p>\n\n\n\n

As a group, Agility\u2019s other controlled businesses reported EBITDA of KD 23.3 million and revenue of KD 82.2 million, increases of 10.5% and 17.5%, respectively, over Q1 2022. <\/p>\n\n\n\n

The main contributors were: <\/p>\n\n\n\n

Agility Logistics Parks (ALP)<\/strong>. ALP reported 10.2% first-quarter revenue growth. ALP Kuwait performed well but still faces a challenge to future operations at certain facilities situated on land leased from the Kuwaiti government. Elsewhere, ALP is continuing to pursue its growth strategy by increasing and optimizing its existing land bank, developing new projects, and looking to acquire additional land, especially in the Middle East and Africa.  <\/p>\n\n\n\n

United Projects for Aviation Services Company<\/strong><\/a> (UPAC)<\/strong> reported a 13.7% increase in revenue for in Q1. The increase was primarily attributable to a rebound in airport-related services and parking, following the reopening of Kuwait International Airport and the removal of COVID restrictions, as well as the Hala-Feb holiday season, which boosted passenger volume and UPAC revenue.\u202f  <\/p>\n\n\n\n

UPAC is a co-investor in the $1.3 billion Reem Mall on Abu Dhabi\u2019s Reem Island. The mall officially opened to the public in February 2023, with 82 units currently occupied and operating.\u202f UPAC expects additional openings by more tenants over the coming months. The mall is the region’s first, fully integrated omnichannel retail ecosystem with digital, e-commerce, and logistics capabilities. It brings together all consumer and retail services to ensure a seamless customer experience. <\/p>\n\n\n\n

Global Clearinghouse Systems (GCS).<\/strong> <\/em> At GCS, Agility\u2019s customs-modernization company, first quarter revenue grew 12.1% vs. the same period in 2022. GCS is focused on delivering optimal efficiency and services to its customers.  <\/p>\n\n\n\n

Agility\u2019s Investments <\/strong> <\/p>\n\n\n\n

Agility holds non-controlling minority stakes in a number of businesses, both listed and non-listed. In Q1 2023, the carrying value of those stakes was roughly KD 1.6 billion inline with Q1 2022 value.  <\/p>\n\n\n\n

\u201cWe have witnessed a relative improvement in the global equity markets, which has been reflected in our investment values. However, as a long-term investor, Agility is focused on investing in sectors it believes will drive value and in companies with strong management that have showcased the ability to generate value,\u201d Sultan said.  <\/p>\n\n\n\n

Given continued market uncertainty and the significance of the DSV stake in determining Agility\u2019s overall value, Agility has entered into multi-year, funded equity collar agreements with several banks to protect the value of the investment and shareholders\u2019 value.  <\/p>\n\n\n\n

Recap of Agility Q1 2023 Financial Performance <\/strong> <\/p>\n\n\n\n