Hussein Hachem, the chief executive of Aramex, said yesterday that the foreign ownership limits is a 'handicap' for the company.
Aramex wants amendment to foreign shares ownership
Aramex, the UAE-based logistics and transport company, wants the limits on foreign ownership of its shares amended amid strong global demand for its equity from international investors, its chief executive said yesterday.
Speaking as the company, quoted on the Dubai Financial Market, unveiled a strong set of financial figures for 2013, Hussein Hachem said: “There is a queue for our stock from global investors. Having the foreign ownership limits is a handicap for us, because we are a global company. More liquidity would be very positive for us.”
He added that foreign investors could not buy any more shares in Aramex because they had reached the 49 per cent ownership limit imposed by UAE law.
He ruled out a move to a foreign exchange to boost liquidity, but urged UAE policymakers to accelerate planned legal changes. “There have been positive signs of progress from regulators, but it hasn’t been translated into legislation,” he added.
Last year, Aramex revenues grew 8 per cent to reach Dh3.33 billion, while profits jumped 14 per cent to Dh278 million. The rate of growth accelerated in the final quarter, Mr Hachem said.
Growth of e-commerce deliveries via Aramex’s “shop and ship” business was a major factor behind the increase. Mr Hachem also said there was a strong recovery in Egypt and Libya, with consumers in those countries buying again after the turmoil of the Arab Spring.
“Libya is back. Consumers are buying again and we can guarantee them four-day delivery. There is more awareness of e-commerce there now. Egypt did very well last year too,” he said.
“The e-commerce industry in emerging markets in the Middle East, Africa and Asia is developing at a rapid rate and capitalising on these trends will remain a focus for Aramex, with global e-commerce revenues growing by 23 per cent in 2013,” he added.
The fastest growth was in international express packages, outweighing a flat performance in freight forwarding, for which there was less demand on European and Asian routes.
The GCC, and the UAE in particular, remain the core of Aramex’s global business. “The GCC is doing very well, with the UAE as the platform and Saudi Arabia in particular as a destination,” Mr Hachem said.
The company’s shares slipped nearly 1 per cent to Dh3 on the DFM, where the results were posted after the market closed. Mr Hashem said that poor liquidity meant Aramex earnings ratios were up to 9 percentage points behind its peer group.