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Enacy Mapakame Business Reporter

Unifreight Africa says it is investing towards the acquisition of a new fleet of vehicles in order to enhance service delivery.

The logistics giant said the investment would continue despite the challenges posed by the Covid-19 pandemic locally and regionally.

Formerly Pioneer Corporation Africa Limited, Unifreight operates a group of companies primarily involved in the road transport industry.

The company’s main activities include inter-city freight consolidations, distribution of general goods and a courier service.

Unifreight’s investment drive comes at a time executives in the sector believe transport and logistics operators should adopt the latest technology to overcome challenges and dynamics brought about by the pandemic.

 Market analysts also believe technology can help industry players to cash in on the Africa Continental Free Trade Area (AfCFTA), which came into effect a year ago.

Group chairman Peter Annesly said the investments into new vehicles would enhance customer service and experience while consolidating market share. 

This also comes as the group has been looking at expanding its revenue streams with management upbeat of a strong performance for the full financial year 2021, which ended in December.

“Notwithstanding the uncertainty in the economy and the difficult trading environment, the group is continuing to invest in new vehicles to improve service to our valued customers.

“We are very grateful that our robust, yet flexible model and diverse customer base has kept us going through very difficult times, without forgetting what a great team we have, who have really dug deep and gone the extra mile.

“We are rigorously pursuing new revenue streams, whilst maintaining and strictly monitoring costs and are confident that we will end 2021 with a favourable set of results,” he said.

According to the group, cumulative second quarter sales were ahead of budget by 14 percent and bettered prior year performance by 70 percent.

“What is a bit disappointing is that despite a dramatic increase in sales, US dollar inflation has been rampant and as a result, reduced margins — but we can be grateful that we are still profitable and profit margins are above industry norms,” said Mr Annesley in an update for the half year to June 30, 2021.

For the half year period, revenue rose 50 percent to $1,1 billion from $793 million recorded during the same period in the prior year.

Total Swift volume went up 63 percent above prior year, with a 56 percent growth in Less Than Truckload (LTL,) and 3 percent up on budget. The group retreated to a loss position of $185 million from a profit position of $10 million in the comparable period.

“Our cumulative net profit as a percentage of revenue is sitting at 10,4 percent which is above industry average, but unfortunately below expectations,” he said.

The transport and logistics entity has also felt the adverse impacts of the Covid-19 pandemic and its persistence continues to impact global supply chains.

In a report on “Six key trends impacting global supply chains in 2022,” KPMG said the ongoing global logistics disruptions stemming from the Covid-19 pandemic continued to impact businesses and consumers as the flow of consumer goods into key markets was delayed. 

The period post the pandemic has also been riddled with uncertainties and labour market shortages have further complicated recovery for many industries.

KPMG however, highlights that, for the transport and logistics business to move forward in this period of uncertainties,                 operations should be flexible and resilient enough to adapt and adjust in real-time to changes in trade flows, new regulations, the impact of  Covid-19, climate change, trade tensions and other geopolitical movements.

Additionally, technology should be effectively utilised to help reduce operating costs, provide visibility, and diversify the way customer needs are met.

“Fleet management and supply chain networks should be responsive to increasing customer requirements (and) collaboration and supplier partnerships, and ongoing risk monitoring are all needed to de-risk the supply chain,” said KPMG.