Letter from
our CEO

Bashar Obeid

We ended 2017 with some very strong numbers: a near double-digit growth in our revenue to AED 4,721 million and solid expansion in our bottom line.

Dear Valued Shareholders,

In the 24 years I have been with Aramex, I have never seen technology be as disruptive to business operating models as it has been in the last few years; change is happening at an unprecedented pace, and yet we continue to grow as a company.

We ended 2017 with some very strong numbers: a near double-digit growth in our revenue to AED 4,721 million and solid expansion in our bottom line to reach AED 435.4 million. We have achieved such growth because our foresight helped us anticipate change, our innovative culture helped us come up with more creative solutions, and our adaptability helped us to capture rising opportunities and to overcome emerging obstacles across all verticals of the logistics and supply chain management industry.

International & Domestic Express Delivering growth.

In 2017, our International Express business grew by an impressive 19% to AED 2,007 million on the back of the strong growth in cross-border e-commerce. Our Domestic Express business witnessed a 4% expansion from 2016 to AED 1,022 million, thanks in large part to our operations in Africa and Asia-Pacific – which are both promising core markets. E-commerce has been the driver of growth in our Express business for the last few years, and we continue to treat this segment as high- growth because the outlook is so promising. We believe the exponential growth in regional and international e-commerce volumes will spill into 2018 – and beyond – encouraging us to maintain our focus on servicing this sector.
Having said that, as the e-commerce landscape evolves and e-retailers’ demands from delivery providers changes, so too must the level of service we offer them. This is why in 2018, we want to improve our last-mile delivery to achieve a high level of service excellence straight through to the doorstep of the package recipient. This will be achieved by expanding our capacity, simplifying complex operational processes by upgrading our technology tools, and upskilling our people. It will also reflect positively on our financials as it will ultimately reduce costs, support margins and expand our bottom line.

Freight Forwarding, Logistics & Supply Chain Management – More opportunities to come.

Our Freight Forwarding business saw a 2% increase in top-line growth to AED 1,157 million. The expansion was owed to the growth in the oil and gas business in the GCC, coupled with robust performance in Africa and Asia. Our Logistics and Supply Chain Management operations also performed well. Excluding the impact of currency conversion, particularly from the Egyptian Pound, this business line would have grown by 6%.
We believe there is significant room to successfully expand our market share in the B2B segment in the coming years. We plan on investing in additional resources and technologies in 2018 to expand our offerings to existing customers and to acquire new ones across all continents and all industries. As we build up those capabilities, we will benefit from cost savings – by eliminating the need to outsource to a third party – and our acceleration into this business line will reflect positively on our top-line by broadening our revenue mix.

Partnerships, alliance and franchising – Focusing on service excellence.

While our core markets - the GCC, wider Middle East, Africa and Asia-Pacific - will continue to command the majority of our operating capital, capital expenditure, and manpower, we are also focusing on improving our services to other markets, primarily by forging strategic partnerships with the best companies in the industry.

In 2018, we will also actively evaluate and consider acquisition opportunities that will enable us to further expand our footprint, improve our capabilities, and enhance our portfolio of product lines. Moreover, our geographical expansion in Africa and Asia is proceeding according to plan, primarily driven by acquisitions and partnerships with qualified and competent franchisees.

Sustainability – Delivering good for future generations.

Aramex continues to be an active corporate citizen and a leading United Nations Global Compact partner. As part of our “Delivering Good” platform, 2017 saw tremendous progress in sustainability initiatives. Through our solar projects in Jordan and the UAE, the introduction of all-electric, emissions-free vehicles, and the LEED certification of our warehouses, we have continued to reduce our Greenhouse Gases (GHG) per shipment from our 2012 baseline by 31%. In 2018, we plan to continue investing in clean technologies across our operations and infrastructure, as well as reduce our waste output and expand our recycling initiatives. We will also publish our first-ever “Total Impact Assessment” to measure the total value we contributed to our communities through our operations, partnerships, and initiatives.

Over the past year, we continued to develop effective partnerships with communities, social entrepreneurs, governments, NGOs, and corporations worldwide. Our strategy remains 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 annually. Furthermore, in line with our goal of responsible corporate governance and to live up to our commitment to Universal Human Rights, we initiated the region’s first Human and Labor Rights Audit at the corporate and operational levels, applying the highest levels of due diligence by local and international axioms.

Our people, our pride.

I have had the privilege to work with some of the best people across all functions of the company, and I consider Aramex employees my family. I want to thank them for their diligent work, innovative mind and strong work ethic – collectively they have allowed us to meet our targets. Moving forward, we will reward talent, upskill employees across all functions, and harness a performance- driven culture. I believe that although we are a technology-driven company, we are also a human- built service provider – and it is mastering this unique blended approach that will ensure we deliver service excellence.

Positioning for the future, today.

The company has been undergoing a business transformation for the last twelve months. But today, we are accelerating our transformation, and we will see changes being reflected both in terms of our operations and our financial performance.

The overarching goal of this transformation is to achieve and continually surpass a high level of service excellence. At the heart of this transformation is a company-wide digital transformation that will enable us to simplify processes across all products and service offerings. It also includes enhancing our non- operational processes. This will allow us to become better at what we do, faster at how we do it, and more profitable in the long run. With the support of our shareholders, I firmly believe that Aramex will be leaner, stronger, and is on a journey to deliver the best experience to all of its stakeholders.

Sincerely,
Bashar Obeid