Revenue Up 22.8% Year Over Year, Driven by
Expansion of Customer Relationships
FUZHOU,
China, Sept. 4, 2024 /PRNewswire/ -- Shengfeng
Development Limited ("Shengfeng" or the "Company") (NASDAQ: SFWL),
a contract logistics company in China providing customers with integrated
logistics solutions, today announced its unaudited financial
results for the six months ended June 30,
2024.
Financial Highlights for the First Half of 2024:
- Total Revenue: Increased by approximately 22.8% to
$227.1 million, compared to
$185.0 million for the same period in
2023. This growth was primarily driven by the expansion of services
with new clients, particularly in the new energy sector. The
Company saw significant growth due to increased demand within this
sector, reflecting deepened partnerships and expanded service
offerings.
- Gross Profit: Decreased by approximately 7.4% to
$21.1 million, compared to
$22.8 million in the first half of
2023. However, the Company anticipates improved margins in the
second half of the year, due to enhanced operational efficiencies
and a focus on higher-margin customer contracts.
- Net Income: Decreased by 22.5% to $5.0 million, compared to $6.5 million for the same period in 2023.
Earnings per share (EPS) decreased to $0.06 from $0.08 in
the first half of 2023. Despite a competitive market environment
and increased operational costs, the Company remains optimistic
about net income growth through improved cost management strategies
and sustained revenue expansion.
Cost and Expense Overview:
- Operating Expenses: Operating expenses increased
slightly by 1.5% to $14.5 million in
the first half of 2024, compared to $14.3
million for the same period in 2023. Operating expenses grew
at a much slower rate than sales, reflecting the Company's
disciplined approach to cost management. This modest increase
reflects contrasting trends within different expense
categories:
-
- Selling and Marketing Expenses: Decreased by 14.2% to
$2.9 million, down from $3.3 million in the first half of 2023. This
reduction was primarily due to a decrease in employee-related costs
as a result of workforce optimization initiatives, which
streamlined operations and reduced overall expenses.
-
- General and Administrative Expenses: Increased by 6.3%
to $11.7 million, up from
$11.0 million in the same period in
2023. This rise was driven by higher employee salaries and
benefits, as well as increased professional consultancy fees. These
increases were necessary to support the Company's expanded
operations and higher revenue base, necessitating additional
resources and staff in the general and administrative
departments.
Cash Position:
- Cash and Cash Equivalents: As of June 30, 2024, cash and cash equivalents were
$11.2 million, compared to
$26.7 million as of December 31, 2023. The decrease was primarily due
to investments in business expansion and increased working capital
requirements to support the growth in revenue. The Company remains
committed to maintaining a strong liquidity position to support
ongoing operations and strategic initiatives.
Operational Highlights:
- Transportation Services: Net revenues increased by 25.0%
to $217.5 million, driven by the
expansion of new customer relationships and increased demand for
logistics solutions, especially in the new energy and consumer
goods sectors.
- Warehouse Storage Management Services: Revenues
decreased by 11.2% to $8.3 million,
reflecting a strategic shift away from low-margin services and the
closure of redundant facilities.
CEO Commentary:
Mr. Yongxu Liu, Chairman and Chief Executive Officer of
Shengfeng, commented, "Our robust revenue growth in the first half
of 2024 reflects the deepened cooperation with our clients,
particularly in the fast-moving consumer goods and new energy
sectors. With notable partners like BYD Company Limited,
Contemporary Amperex Technology Co. Limited, and Budweiser Brewing
Company APAC Limited, we are endeavoring to enhance our service
offerings and expand our presence in these dynamic industries. We
remain confident in our ability to maintain our growth trajectory
while enhancing operational efficiencies."
Outlook:
Looking ahead, Shengfeng aims to sustain its growth and improve
margins in the second half of 2024. The Company is committed to
leveraging its extensive logistics network and innovative solutions
to serve a broader range of industries and customers.
About Shengfeng Development Limited
Shengfeng Development Limited is a contract logistics company in
China providing customers with
integrated logistics solution services. Established in 2001, the
Company has developed extensive and reliable transportation
networks in China, covering 341
cities across 31 provinces, as of June 30,
2024. The Company provides integrated logistics solutions
comprised of B2B freight transportation services, cloud storage
services, and value-added services. The Company applies
well-established management system and operation procedures to
assist companies in China to
increase efficiency and improve their own management systems with
respect to transportation, warehousing and time management. For
more information, please visit the Company's website:
http://ir.sfwl.com.cn/.
Forward-Looking Statements
This press release contains "forward-looking statements."
Forward-looking statements reflect our current view about future
events. These forward-looking statements involve known and unknown
risks and uncertainties and are based on the Company's current
expectations and projections about future events that the Company
believes may affect its financial condition, results of operations,
business strategy and financial needs. Investors can find many (but
not all) of these statements by the use of words such as
"approximates," "believes," "hopes," "expects," "anticipates,"
"estimates," "projects," "intends," "plans," "will," "would,"
"should," "could," "may" or other similar expressions in this press
release. The Company undertakes no obligation to update or revise
publicly any forward-looking statements to reflect subsequent
occurring events or circumstances, or changes in its expectations,
except as may be required by law. Although the Company believes
that the expectations expressed in these forward-looking statements
are reasonable, it cannot assure you that such expectations will
turn out to be correct, and the Company cautions investors that
actual results may differ materially from the anticipated results
and encourages investors to review other factors that may affect
its future results in the Company's registration statement and
other filings with the U.S. Securities and Exchange Commission.
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SOURCE Shengfeng Development Limited