Letter from the CEO

Dear Stakeholders,

2015 was an exciting year for Aramex. We achieved a number of important milestones, further enhancing our operations in emerging economies and consolidating our position as an innovator and market leader, all against a backdrop of global volatility. 2015 was also important as we laid the groundwork for launching critical development plans, which we are now looking to activate in the year ahead.

Hussein Hachem

Chief Executive Officer

I am proud to say that 2015’s fiscal performance has prepared us well to execute our 2016 plans. We recorded AED 3,837 million in revenues, up by 5% compared to AED 3,643 million in 2015. This increase was driven by robust growth, primarily in our international and supply chain services across key geographies in the Middle East, Africa and Asia-Pacific. Our net profits decreased by 2% to AED 311 million. Following a year of positive financial results and careful strategic planning, we are ready to introduce a number of exciting initiatives in 2016.

 

I believe the key to building on this success in 2016 will be remaining true to our core strategy – staying asset-light. This has always been a competitive differentiator and enables our success, even at times of economic, social and political volatility. To get the most out of this model, we leverage innovative technologies in a way that best integrates with our asset-light approach and allows us to be as relevant and efficient as possible in our diverse markets. This also provides us with the flexibility and agility needed to adapt quickly to customer needs. By continually innovating, we are using technology to pre-empt market changes and stay ahead of the curve. In my opinion, this strategy has enabled Aramex to become the best in the market.

However, effectively leveraging technologies is not easy. This requires careful research and detailed analysis of the economy, industry and consumer trends, in order to identify the appropriate technology for our asset-light model and how best to deploy it. This approach has been critical to selecting and implementing appropriate innovative technologies that are effective and sustainable for our business. It has also accelerated the development of our e-Commerce platform, last mile delivery solutions, business operations and global network. Our use of technologies to better enable our asset-light business model underpins every critical strategic decision that we make.

Our e-Commerce platform is performing at an all-time high. It is the strongest performing segment of our business, accounting for 25% of our annual revenues and currently growing at 30% annually. There is no doubt that leveraging innovation has helped fuel e-Commerce growth. With more shoppers coming online due to growing access to smartphones, consumers are demanding increasingly sophisticated technology solutions to make their experience faster, easier and more enjoyable. New phone apps, for example, allow consumers to place orders and deliveries, pay online and track packages in real-time. As online shoppers continue to quickly change and adapt their behavior to using new, innovative technologies, we must anticipate and successfully meet these demands.

Our last mile delivery solutions have never been stronger. To improve our overall customer experience, we have implemented technologies to enhance our tracking systems to reach more off-the-grid consumers, deliver packages faster and reduce the likelihood of error or delays. While there are a number of components that make our e-Commerce platform successful, I believe that ensuring customers receive their packages on time and at a location of their choice is what keeps them as long term Aramex clients. We are at the forefront of innovation in the global logistics market and will continue to harness innovative technologies to further enhance our last mile delivery solutions.

Our business operations are becoming increasingly seamless. This is because of our commitment to upgrading and streamlining our technologies, both externally and internally. For customers and clients, our services and employees have become more accessible, visible and efficient due to the deployment of new technologies. Our customer service responses are faster, tracking systems more effective and deliveries more efficient. We have also further optimized our systems by standardizing operations internally through the deployment of new software and programming. This year’s deal with SAP Software Solutions will further accelerate this progress. Our finance, procurement, human resources, IT, communications and management teams can now better communicate, streamline and enhance their operations – making the Aramex business healthier, stronger and in a better position to quickly exploit market opportunities as they arise

Our global network is expanding rapidly. Effective leveraging of technology is also critical to growing our wider Aramex global network and informs our decisions when exploring potential partnerships in markets abroad. Emerging economies worldwide, such as Africa and the Asia-Pacific, are quickly developing and require more efficient and innovative logistics services. Because of this we carefully identify logistics partners who best fit with our technology platforms and have other suitable, scalable synergies with Aramex’s asset-light business model in our target markets. We also independently invest the appropriate finances, research, people and time in developing and implementing new technology solutions that satisfy local consumer preferences. We are currently assessing a number of strategic investments across our core markets to further grow the Aramex network and we will be sharing more information as we move forward with our plans.

Another important factor of the success and continuity of our business is the wellbeing and sustainability of the communities where we operate. To support Aramex’s ongoing sustainability efforts, over the past year we have officially unveiled our sustainability platform “Delivering Good”, which better enables us to create effective partnerships with communities, social entrepreneurs, governments, NGOs and corporations worldwide. Our strategy is in line with the United Nations’ Sustainable Development Goals, focusing on increasing economic growth, access to quality education and fair employment, and taking steps to mitigate climate change and its impacts globally. We also continue to adhere to the United Nations Global Compact by communicating our progress on an annual basis. Currently, 95% of our locations are actively engaged in sustainability initiatives and projects and identify with at least one of the three focus areas of our Delivering Good platform: Education and Youth Empowerment, Entrepreneurship and Environment. These sustainability programs are infused with Aramex’s unique corporate values of innovation, creativity and disruption, as we encourage people to test ideas, push boundaries and be technologically savvy. We believe that by continuing to adopt innovative technology solutions across all markets and sectors, the world will rely less on natural resources and grow sustainably. This approach also means that we are effectively contributing to communities’ efforts to create new jobs and more wealth. We are proud of our achievements this year and it brings me great pleasure to state confidently that we are leading the way in sustainability efforts across the region.

Our future is promising in large part because we have a corporate culture where innovation and creativity is encouraged and thrives. We understand that creating a workplace that celebrates diversity and encourages open dialogue is essential to achieving our core business goals. I encourage all of my colleagues to harness the power of innovative thinking to spark meaningful, disruptive change within the company, across the wider industry and in their communities. Innovation is an important part of our company’s history and tradition, and helps us drive a more sustainable, and consequently more successful, business. I have always maintained that our success is built on a strong, capable global team and would like to extend my thanks to all of my colleagues who help to ensure that Aramex takes another step forward every day.

As we move into 2016, it remains unclear how the global economy will perform. Despite this uncertainty we are confident we will effectively execute our strategy and leverage technology in a way that most benefits our business and all of our stakeholders. We must continue to stay at the forefront of global trends and find the optimal ways to enhance our logistics and transportation solutions to match ever-changing customer preferences. This will ultimately help better facilitate the movement of goods and services and encourage greater economic activity globally. Efficient logistics and transportation systems are the lifeline that connects people, goods and services throughout the world, and we will stay committed to keeping this lifeline healthy and strong.

I am truly excited for the year ahead and would like to thank all of our stakeholders for their continuous support as we move forward with our incredible journey. I hope you share our excitement about our path for 2016 and beyond.

Hussein Hachem

Chief Executive Officer