Velogic: A Tale of Growth, Soaring Revenues in 2024

The financial ledger opens on a dramatic note for Velogic, revealing a scene of burgeoning revenue. The year ending December 31st, 2024, unveiled a tale of expansion, with revenue skyrocketing while profits tread a precarious path. The figures speak of success and underlying concern: a remarkable 31% increase in revenue, reaching an impressive Rs 2.2 billion. This expansion, amounting to a considerable Rs 527 million, is largely credited to the strong performance of the cross-border logistics division. The market seemed to be on a positive trend.

The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) showed an increase of only 4%, at Rs 315 million.

The culprit? Rising labour costs. Salaries in Mauritius increased by Rs 44 million.

The ultimate result? The profit after tax, the crucial measure of financial health, stayed almost unchanged.

At Rs 141.7 million, is not too far from the Rs 142.8 million recorded in 2023. A sobering revelation, given the substantial increase in revenue.

A Picture of Complexity

Within Mauritius itself, a contrasting picture is visible. Revenue from operations improved by 40% to Rs 1.2 billion, indicating strong operations.

However, profits dipped compared to the previous year. Increased salary and tax expenses are to be blamed.

The cross-border logistics segment benefited from the integration of MC Easy Freight Ltd, acquired in mid-July 2024.

Air and sea shipment volumes rose. Unfortunately, profitability decreased, a consequence of higher financial costs.

Domestic logistics painted a mixed scene. Revenue saw a slight increase, while warehousing and storage activities grew due to increased volumes.

Transport activities, however, suffered from the decrease in coal and sugarcane transported. The costs of depreciation on rights-of-use assets reduced profitability.

On a brighter note, sugar packaging activities experienced an increase in both revenue and profitability, owing to higher prices and a better product mix.

Maritime transport’s performance stayed steady.

Overseas Operations: A Study in Contrasts

Overseas, the narrative took on a variety of hues. Revenue increased by 21%, reaching Rs 956 million, and profits after tax rose by 37% to Rs 61 million.

• Kenya: Higher Distribution Trips boosted revenues. Profitability also improved due to lower diesel prices and a favourable exchange rate.
• India: Positive performance, driven by increased air exports. However, lower gross margins, the consequences of a competitive market, impacted profitability.
• Madagascar: Increased air and sea transport volumes saw a boost. Operational costs, however, kept profitability stable.
• La Réunion: The growth trend witnessed towards the end of the previous financial year continued, resulting in increased profitability.
• Tanzania: The newly launched operations in Tanzania incurred a loss of Rs 1.5 million. The intensification of activities is ongoing.

Looking forward, the company anticipates the revenue growth of the first half to continue, however, overall profitability will remain affected by the recent rise in salaries.

Source: Le Mauricien