BUOYED by a rebound in tourist arrivals, transport and logistics company Knutsford Express has seen a return to profitability in the second quarter (Q2) of financial year (FY) 2022/23, according to an unaudited financial statement shared on the Jamaica Stock Exchange website.

“Travel to Jamaica remains robust and reflects a strong desire to visit Jamaica despite the headwinds of travel advisories and SOEs (states of public emergency),” directors Oliver Townsend and Anthony Copeland informed shareholders in their report.

“Transportation revenue has also grown significantly in this period due to increased local and international travel,” they added.

The directors also noted that revenue from its courier service continues to grow as it increases delivery touch points to 18 across the island.

For the period ended November 30, 2022, Knutsford Express reported a net profit after tax of $58.88 million when compared with a loss of $821,626 in Q2 2021/22, due to discontinuation of its US subsidiary. Profits for the period under review were generated from revenue amounting to $397.96 million, which represented a 65 per cent increase a year prior.

Despite a 37 per cent rise in administrative and general expenses, which rose from $235.1 million in Q2 2021/22 to $322.54 million, the company managed an over 1200 per cent jump in operation profit of $64.37 million versus $2.13 million.

The company also added a revenue stream with the opening of its Knustford Business Centre in Drax Hall, a major strategic initiative that “provides synergies as a key logistics point for our business customers in addition to creating a rental income stream, along with our core transportation business”.

Though the report did not indicate a breakdown of revenues from courier service, passenger transportation services and rental income, it noted that all three revenue streams “have all combined to yield one of the strongest second quarters”.

In response to the Jamaica Observer about the breakdown in revenues, Townsend said, “Our quest for diversified income has led to our Drax Hall hub and the business centre. And, lease income is meeting our expectations and provides solid contribution to our results.”

Additionally, he pointed out that the company’s “intercity travel” is becoming more attractive to commuters who find the offering more affordable and cost-effective in light of high fuel prices.

When asked if the company will resume its operations in the US, Townsend shared that there were no immediate plans.

For the six months Knutsford Express generated $143.1 million in net profit after tax — up by over 1600 per cent when compared with $8.38 million — from revenues of $813.05 million. Earnings per share increased from $0.02 to $0.29.

Total assets in the second quarter have grown over the similar period last year by 18 per cent from $1.31 million to $1.557 million. At the same time, the company’s cash position decreased from $65.87 million in the previous year to $58.93 million on November 30, 2022.

While Knutsford Express has witnessed improvements in operational efficiencies “over the COVID-19 period”, it plans to further digitise processes that will result in further improvements and result in enhanced customer experience.

– Josimar Scott