LBC Express Holdings Inc. of the Araneta group said net income in the third quarter of the year dropped 71 percent to P85 million from P291 million year-on-year due to a significant increase in operating expenses and cost of services.
LBC said in a disclosure to the stock exchange over the weekend revenues in the third quarter of the year jumped 34 percent to P3.3 billion after retail and corporate logistics sales climbed 42 percent and 32 percent, respectively.
Revenues from the logistics segment rose 38 percent P3.1 billion in the third quarter, helped by the 33-percent increase in volume, the net addition of 58 branches in the country and the introduction of new products and services.
The cost of services, however, grew at faster pace of 36 percent to P2.24 billion in the third quarter of the year as the higher volume in logistics resulted in the increase in cost of delivery and remittances by 49 percent.
Operating expenses also surged 42 percent to P787 million.
LBC’s net income in the nine-month period surged 73 percent to P1.26 billion from P740.8 million on year on higher gross profit following an increase in volume
Services revenues grew 23 percent to P9.1 billion, with the logistics business climbing 27 percent to P8.4 billion on the back of a seven-percent growth in volume.
Newly-acquired businesses also contributed to P494 million to total logistics revenues, constituting six percent of the total.
LBC in March acquired four affiliate cargo and remittance companies operating in California, New Jersey, Saipan and Hawaii for a combined $8.55 million.
It purchased in June shares in four cargo and money transfer companies in Australia and Singapore. These were LBC Australia Pty Ltd.; LBC Money Transfer Pty Ltd.; LBC Express Airfreight Pte Ltd; and LBC Aircargo Pte Ltd.
The acquisitions were in line with a strategy to consolidate all international businesses under the company.
LBC added 58 new branches in the country in the first nine months of the year.
The cost of services rose 24 percent to P6.05 billion also due the volume growth in the logistics business.