Unifreight Group sees strong growth in Q1 2024 amid market challenges


Zimbabwe Stock Exchange (ZSE)-listed logistics company Unifreight Group reported a substantial increase in its trading volumes in the first quarter to 2024, marking a 58% increase over the previous year, which In turn, it had experienced an increase of 135% compared to the previous year.

Announcing the group’s Q1 2024 update, CEO Richard Clarke attributed this continued growth to strategic fleet expansion, increased capacities and aggressive marketing efforts within the truckload market segment. of trucks (FTL).

“We have witnessed a substantial increase in first quarter volumes, up 58% year-on-year, which in turn was up 135% year-on-year. This steady growth is a testament to our strategic fleet expansion and increased capabilities.

“Our aggressive marketing efforts within the full truckload (FTL) market segment have borne fruit, despite a 17% reduction in total performance per kilometer due to the nature of the segment. This reduction is offset by the increase in volumes moved,” Clarke said.

He said Unifreight’s strategic focus on wholesale consumer goods has proven advantageous, particularly as this segment remains relatively unaffected by currency fluctuations.

“Our contributions to total revenue have shifted from Less Than Load (LTL) to FTL, with the FTL contribution increasing from 29% in 2023 to 41% in 2024. Tobacco remains a key revenue driver. Most major traders have chosen Swift for the safe and reliable transport of their tobacco from regional plants to Harare.

“Despite a smaller tobacco crop trending towards 220 million kilograms for the season, we anticipate moving more than 30% more volume from this sector after securing additional traders in 2024,” Clarke said.

It praised the reliability and cost-effectiveness of the FAW28-380FT units in its fleet, highlighting their superior performance compared to other models.

Unifreight, according to Clarke, plans to acquire an additional 60 FAW28-380FT units before the end of the year to further enhance its operational capability.

However, he said operating within Zimbabwe presents significant cost challenges.

“Regionally, Zimbabwean fuel is the most expensive – our pump price is $1.68, compared to $1.11 in Zambia. Vehicle registration is also significantly higher: $1,560, compared to just $132 in Zambia. These exorbitant costs make operating a cross-border fleet in Zimbabwe less attractive.

“Diesel duties currently amount to 0.427 US cents, and 25% of export earnings are converted into ZiG, which cannot be freely converted back to dollars at controlled exchange rates published by the Bank of the Booking. Fortunately, Unifreight has a flexible business model that allows us to change the amount of assets moving cross-border as necessary,” he noted.

Despite these challenges, Unifreight remains optimistic about its prospects for the rest of the year. The company already generated more than 13 million ZWL in the first quarter of 2024.

“The Board of Directors, Executive and Management are focused on generating positive results and protecting shareholder value,” Clarke said.


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