TRANSPORT and logistics firm, Unifreight Africa Limited, is considering establishing a new fourth-party logistics strategic business unit (SBU) as a revenue stream to subcontract its excess volumes to third-party transporters.
A fourth-party logistics SBU is a specialised division within a company that provides comprehensive supply chain management solutions by coordinating and managing logistical services for the company’s clients.
Unlike a third-party logistics provider, which focuses on directly handling warehousing, transportation and distribution, a fourth-party logistics acts as an integrator that oversees the entire logistics network, utilising third-party logistics and service providers.
In its abridged financial results for the half year ended June 30, 2024, Unifreight chairperson Peter Annesley unveiled the company’s new initiative to diversify its customer base.
“Looking ahead, we remain cautiously optimistic about the second half of the year. Our focus will continue to be on expanding our cross-border operations and driving revenue growth through increased capacity and enhanced service offerings,” Annesley said.
“We are exploring new revenue streams and opportunities to diversify our customer base further. This includes a new fourth-party logistics SBU which will sub-contract excess volume to third-party transporters in the region.”
He said while the macro-economic environment remained uncertain, the firm was confident that its strategic initiatives, combined with the dedication of its team would enable it to navigate any challenges effectively.
“During the first half of 2024, Unifreight continued to prioritise fleet expansion into cross-border as part of our strategic goal to have 100 assets operating across borders by the end of the year. We are on track to achieve this target, which will not only boost our capacity but also strengthen our market position in the region,” Annesley said.
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“Our operational focus has been on driving efficiencies and expanding our footprint in key sectors. We have seen robust growth in the volumes of key commodities transported, particularly in the tobacco sector, which recorded a significant increase compared to the same period last year.”
Additionally, he said the firm’s partnerships with blue-chip clients, including Delta, Triangle, Unilever and Nestlé, had been instrumental in maintaining its high service standards and expanded distribution network.
For the half year ended June, group revenues of ZiG164 million were recorded although these were flat year on year, driven by subdued market demand on the back of the introduction of the ZiG.
Operating costs increased by an overall 12% to ZiG135,6 million during the period, from the 2023 comparative, driven by an increase in vehicle operating costs and premises and depot related costs.
An income tax credit of ZiG70,08 million saw the group register a profit after tax of ZiG90,4 million.
This overturned a loss of ZiG28,37 million for the half year ended June 30, 2023.
“Our total comprehensive income for the period was ZiG81,6 million, which is 60% below prior year,” Annesley said.
Total assets declined for the period under review to ZiG547,11 million, down from ZiG560,28 million recorded in the prior year.
The decline was due to no asset revaluations being performed at the end of the period.
Despite this, the firm had ZiG1,17 to every dollar of short-term debt leaving it liquid.
