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UPDATE 1-Dubai's Aramex Q2 profit rises 14 pct, Egypt weighs
July 25, 2012 / 11:51 AM / in 5 years

UPDATE 1-Dubai's Aramex Q2 profit rises 14 pct, Egypt weighs

* Aramex Q2 net profit 64.4 mln dirhams vs 56.5 mln dirhams

* Revenue rises 21 pct to 782 million dirhams

* Egypt ops hit by uncertain economic outlook in short-, medium-term (Adds details)

DUBAI, July 25 (Reuters) - Logistics firm Aramex posted a 14-percent rise in quarterly profits on Wednesday, buoyed by its Gulf Arab region operations which offset weakness in Egypt where an uncertain political outlook has hampered its business.

Aramex, a favourite of regional fund managers, also said investment costs in new African operations had weighed on its quarterly results.

The Dubai-based firm had second-quarter net profit of 64.4 million dirhams ($17.53 million) for the period ended June 30, up from 56.5 million dirhams a year-ago.

Revenues rose 21 percent to 782 million dirhams from 648 million dirhams in the prior-year period, Aramex said in a bourse filing.

Its Gulf operations and recent acquisitions in Southeast Asia and Africa contributed significantly to profits, Aramex Chief Executive Fadi Ghandour, who plans to step down from his role, said in the statement.

In its key Egyptian market, Aramex saw “a significant slowdown” in operations in the wake of June presidential elections.

“The outlook for the short to medium term remains unclear due to the (Egyptian) economy’s vulnerability to the political conditions in the country,” the company said.

Aramex was forced to suspend its operations in Egypt during political unrest that overthrew former president, Hosni Mubarak.

Last year, the logistics firm bought South Africa’s Berco Express as well as Kenya’s Oneworld Courier and In-Time Couriers and signed a joint venture with SinoAir in China.

“While our strategic acquisitions in 2011 are bearing fruits with an increasing contribution to our global revenue, initial investments in our greenfield operations in Africa continue to weigh down on our immediate quarterly results and are expected to start contributing positively to our revenues by 2013,” Ghandour said.

Ghandour is to step down by the end of 2012 and hand over day to day operations to Hussein Hachem, the current head of the Middle East and Africa regions, the company said in April.

Prior to the results, Aramex’s shares closed down 0.57 percent on the Dubai index ($1 = 3.6730 UAE dirhams) (Reporting by Praveen Menon; Editing by Amran Abocar)

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