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LONDON (Alliance News) - Chinese logistics company, China Chaintek United Co Ltd, Monday posted an increase in both profit and revenue for the first-half of 2014, boosted by new customer wins and a more "diversified" client base.
The company, which provides logistics for consumer goods makers in China, reported a pretax profit of CNY144.7 million for the six months to June 30, up 9% on the CNY132.8 million profit it reported in the first-half of 2013.
It said its profit was driven by a 4% increase in revenue to CNY173.8 million, up from CNY167.7 million, as well as a further increased in its load tonnage by 3% to 1.25 million tonnes.
"Trading in the first half of the current financial year has been in line with management's expectations and the Board anticipates that the full year will also be in line with current market expectations," said Executive Director and Founder Shufang Zhuang in a statement.
China Chaintek declared an interim scrip dividend of 2 pence, or 1 pence cash alternative.
"In our core Logistics Services Division we were pleased with the diversification of our customer base, building on our existing strength in sports shoes and apparel and moving into growing markets such as food and building materials. In respect of our Inventory Solutions business, we are pleased with the demand we are seeing for this division," said Zhuang.
China Chaintek said expanding e-commerce activities in China and the relatively undeveloped logistics market represents strong growth opportunities for the company, and said as a result it will need to invest in IT infrastructure and systems in the coming months.
China Chaintek has told Alliance News in the past, the a key ingredient in its path to future growth is the construction of its new Logistics Park, which it is currently waiting for approval on. It is also waiting to be granted a rebate in the region of 25% to 30% on the land price it paid to the regional Chinese government of Fujian for the land use as a logistics park.
"The construction of our new logistics park represents an important milestone for the company in providing an integrated service to our customers, which will help the group to further strengthen its market share. In addition, having regional distribution centres in strategic locations will help us progress towards our aim to become a national logistics company," said Zhuang.
The company's stock was trading 5.9% higher before midday Monday, at 90.00 pence per share.
By Rowena Harris-Doughty; rowenaharrisdoughty@alliancenews.com; @rharrisdoughty
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