Kerry Logistics Network Limited (KLN) announced the Group’s annual results for 2024.
Group’s financial highlights
- Revenue* grew by 23% to HK$58,274 million (2023: HK$47,408 million)
- Core operating profit* increased by 23% to HK$2,725 million (2023: HK$2,207 million)
- Core net profit* increased by 12% to HK$1,357 million (2023: HK$1,214 million)
- Profit attributable to the Shareholders was HK$1,542 million, which represents a growth of 95% (2023: HK$791 million)
- Integrated Logistics (‘IL’) business recorded a segment profit* of HK$1,251 million (2023: HK$1,289 million), which represents a decrease of 3%
- International Freight Forwarding (‘IFF’) business recorded a segment profit* of HK$1,950 million (2023: HK$1,400 million), which represents a growth of 39%
- Proposed final dividend of 15 HK cents per Share to be payable on or around Tuesday, 10 June 2025.
* For continuing operations only
Vic Cheung, Executive Director and Chief Executive Officer of KLN, said, “In 2024, the global economy underwent a slow recovery. Yet, challenges abounded in the macroeconomic environment. KLN responded to these evolving markets with agility, leveraging our network resources and offering flexible and cost-effective solutions to its customers. The Group’s resilience was fully demonstrated by our 2024 results. KLN recorded double-digit growth across both revenue and core net profit for the year, outperforming our international peers. We are also excited to announce our global rebranding campaign from ‘Kerry Logistics Network’ to ‘KLN’, now an established household name that our customers have grown accustomed to and trust, which will usher in a new era of the Group’s development.”
Integrated logistics
The Group’s IL business reported a 3% drop in segment profit due to the impact of the changes in the external environment and in the domestic consumption patterns on key markets, Hong Kong and the Mainland of China. Undeterred by a difficult operating environment in the two markets, KLN successfully narrowed the decline in segment profit by capitalising on the growth in other Asian markets and implementing a series of cost optimisation measures to reduce operational expenses, including streamlining processes and human resources utilisation.
The Hong Kong IL business recorded a 12% drop in segment profit as a result of the domestic economic downturn and changes in the consumption patterns of visitors and local citizens. In the Mainland of China, the IL business recording an 11% drop in segment profit.
The IL business in the rest of Asia registered a 25% increase benefitting from the growth in India, Singapore and Vietnam and driven by the stable performance of Kerry Siam Seaport in Thailand. Building on its extensive network and diversified business portfolio in Southeast Asia, KLN capitalised on the opportunities arising from the international expansion policies of Chinese corporations in 2024.
International freight forwarding
The Group’s IFF business recorded a 39% growth in 2024, supported by the growth in key markets including the Mainland of China, the US, Hong Kong and the rest of Asia.
The Red Sea situation triggered a spike in ocean freight rates which began in May 2024, while the ocean freight market experienced a supply shortage in 2024 Q3, which KLN fully capitalised on by providing customers with the rare offering of block space. KLN focused on serving key customers and successfully improved its segment profit, while maintaining its top position globally as the leading NVOCC in the Asia-US trade lane.
In 2024, KLN’s industrial project logistics division strengthened its service capabilities and contributed revenue of over HK$1.7 billion to the Group. The segment is expected to become another growth driver for the Group in the coming years.
The joint venture between the Group and S.F. Holding commenced operations in November 2023 to provide ground handling services at the international cargo terminal of the Ezhou Airport in China. In 2024, the joint venture recorded a revenue contribution of more than HK$200 million in its first year, significantly exceeding expectations.
Rebranding to ‘KLN’
The Group is undertaking the rebranding of ‘Kerry Logistics Network’ to ‘KLN’. The rebranding exercise presents a valuable opportunity for the Company to further establish a more unified and differentiated corporate identity and reinforce its own unique strategic positioning and value proposition to better serve the interests of its shareholders. The Group is to phase out the use of the Kerry trademarks and ‘Kerry’ as part of the company name by 30 June 2025.
Vic Cheung concluded, “We expect supply chain anomalies to persist in 2025. The volatile policy environment will induce more corporations to shift their investment focus towards the Southeast Asian or South Asian regions. The development potential within these regions is expected to become a growth area for KLN’s IL business. We will also actively leverage our existing diversified market presence, including our extensive overseas warehouse network and ocean and air freight services, to capitalise on new opportunities springing from the supply chain reshuffle. With KLN’s unique competitive advantages and the ability to capitalise on new opportunities brought about by the changes in the market, we will further drive the overall growth of our business, and have our future growth potential reflected in the Company’s market valuation under the KLN brand.”
