2GO GROUP, Inc. swung to a profit in the first quarter, fueled by sustained growth in its non-shipping business.
In a regulatory filing, the listed company said its net income attributable to equity holders of the parent stood at P42.2 million, a turnaround from the P265.84-million net loss recorded during the same period in 2017.
Revenues increased by 11% to P5.37 billion, on the back of the strength of its logistics and distribution business.
Non-shipping revenues rose 37%, due to “increased service offerings to existing strategic customers, the addition of new customers, and an overall focus on customer service.” The share of non-shipping revenues also went up to 64% in the first quarter versus 52% over the same period in 2017.
On the other hand, revenue from its shipping business fell to P1.906 million, down 18% from the P2.326 million it posted last year. 2GO said the scheduled dry docking of seven vessels, as well as storms and typhoons that forced cancellations over a two-week period, pulled down the first quarter figures.
“The overcapacity and competition in the Freighter market continues to push down the freight rates. Revenue from Travel was maintained despite the 5% reduction in capacity as a result of the scheduled dry docking,” it added.
Rising price of fuel and higher sales of inventory from 2GO’s distribution business resulted in 15% increase in cost and expenses to P4.806 billion for the first quarter. — D.A. Valdez