JWD, a leading fully integrated in-land logistics service provider, expects a strong recovery in the second half of 2016 in response to the implementation of its cost-saving programmes and its revised strategy to attract new customers. It will launch a JCS for chemical distribution in Laem Chabang port and pursue new warehouse expansions in the CLMV markets, which will contribute to annual growth rates of at least 7% between 2016 and 2018. It believes that its business has bottomed out in Q2/16, when the level of demand for its cold-storage warehouse space was hit by Thailand’s illegal fishing issues.
Mr Charvanin Bunditkitsada, Chairman of the Executive Committee and Chief Executive Officer of JWD Infologistics Public Company Limited (JWD), a leading fully integrated in-land logistics service provider, revealed the company’s forecast of a strong recovery in the second-half of 2016 after the company has adapted its strategy to increase business opportunities and has been building new projects that will commence commercial operation and revenue generation by Q3 or Q4. Last July, he said, it inaugurated a 6,900sq m JCS for distribution of chemicals, the space of which is targeted to be at least 50% occupied by tenants by this yearend.
The company is also expanding its business in the Asean region as planned to tap the opportunities opened up by the formation of the Asean economic community (or ‘AEC’). It has partnered with Srithai Group in setting up ‘LINK ASIA LOGISTICS’ as a joint-venture firm to provide cross-border transport services in the region since Q2, and the revenue from the business will be first earned in the second half of the year. In addition, it will begin commercial operation of its 4,428sq m warehouse in Cambodia and 3,300sq m warehouse in Myanmar, which means that at the end of this year its aggregate warehouse space in the CLMV markets will rise to 9,448sq m.
The commencement of commercial operation of the company’s new warehouse in Laos (with space increased by 3,354sq m from 720sq m), scheduled for Q1/17, will increase JWD’s FY2017 figure of warehouse space in the CLMV markets to 12,800sq m, which will enable the company to enhance its efficiency in supplying services to its customers in the markets and allow it to record annual growth rates of at least 7% on average over the next three years (2016-2018).
He added that JWD is likely to experience an overall slowdown over the first half of 2016 due to the lower-than-expected results in Q2 (April to June) attributed to lower import and export volumes. Particularly, the frozen- and cold-storage segment was affected by illegal fishing and human trafficking issues in Thailand, which was downgraded to US’s ‘Tier 3’ for its human-trafficking records before being upgraded to the current level, said he.
For the storage and management of general goods, JWD closed down its two warehouses in Laem Chabang port to pay way for building a JCS for distribution of chemical goods. It will also incur higher operating and business development costs to allow it to generate new growths and increase its investments both domestically and abroad as originally planned.