Profit surges at auto logistics company Gefco
Gefco has been steadily expanding beyond auto parts in recent years.
Gefco’s profit surged 32 percent in 2016 outpacing sluggish revenue growth as the global auto logistics group continued to cut its fixed costs.
The Russian Railways’ subsidiary earned 172.8 million euros (£192.7 million) before interest, tax, depreciation, and amortization, compared with 130.8 million euros a year earlier as revenue crept up just 1.3 percent to 4.2 billion euros.
The company, which is headquartered in France, continued to branch out into non-auto sectors, including technology, home equipment, and healthcare, and completed the integration of IJS global, a Dutch freight forwarder specializing in the transport of pharmaceutical, high-tech, and aerospace products in China, South Asia, Australia, and the United States.
Gefco also signed new logistics contracts with several auto manufacturers, including Renault Nissan, VWG Audi, BMW, and Toyota, following on an exclusive 8-billion-euro, five-year supply chain deal with France’s PSA Group.
“In 2017, our aim is to extend our finished vehicles logistics business while continuing to develop the overland, warehousing, and reusable packaging, freight forwarding and 4PL [fourth-party logistics provider] expertise by testing new technologies and concluding new partnerships,” said Gefco CEO Luc Nadal.
Russian Railways, which paid Gefco’s former owner PSA Group 800 million euros for a 75 percent stake in late 2012, is now weighing the sale of a minority shareholding.
“The option of a sale is being considered.
From our point of view, to manage it is enough to own 50 percent plus one share,” Oleg Belozerov, the CEO of the state rail monopoly, told the Kommersant Business Daily.
Russian Railways has “certain conditions concerning Gefco” and is discussing them with several partners, including the state-supported Russian Direct Investment Fund.
The PSA Group still retains a 25 percent stake in Gefco.