Leading Asean-based ‘Total Logistics Solutions Provider’ JWD outlined its FY2018 business plan, setting a revenue growth target of 10%, adopting four core strategies (Network, Operation, IT and Human Resource) to enhance its capacity and focusing its activities on creation of networks and added values through services in the whole supply chain or management of the whole logistics process, including in the early stage, to transform itself into a “Regional Supply Chain Manager”. It has reached an agreement to acquire shares in CSLF, a Taiwan-based food service firm that owns frozen ready-to-eat food brands as well as imports and sells food products bearing international brands, a move taken to position itself as a “Regional Food Supply Chain Service” provider with new capacity, for example, to perform materials acquisition for customers, as well as processing, production, storage, transport and distribution of products, and to serve as a brand representative (in addition to the existing capacity to predominantly provide cold and frozen storage and transport services), as a way to enhance competitiveness and reduce risks through access to products.
Mr. Charvanin Bunditkitsada, Chairman of the Executive Committee and Chief Executive Officer (CEO) of JWD InfoLogistics Public Company Limited (JWD), a leading Asean-based ‘Total Logistics Solutions Provider’, revealed the company’s plan to expand both domestically and internationally in order to transform itself into a regional provider of logistics solutions and supply chain management services. The company set a 10% YoY revenue growth rate and adopted four core strategies that involve i) network creation, i.e. expansion of the logistics business networks to cover the whole supply chain and all modes of transport); ii) establishment of an Operation Excellence Team to ensure satisfaction of a common set of logistics standards by all domestic and overseas JWD companies; iii) upgrading of IT infrastructure to enhance the responsiveness to customers’ logistics demands in the digital age; and iv) human resource management, including formation of teams and development of personnel to make the organisation an employer of choice, which will allow it to attract talents.
For FY2018, JWD has allocated funds totaling more than THB 2.5 billion to finance new investments and expansions. Recently, it has reached an agreement to acquire shares in CSLF, a Taiwan-based food service firm that manufactures, imports and sells food products and posted about THB 589 million in revenue and about THB 20.7 million in net profit in FY2017 and has set the target to grow by 15% this year. under which it will acquire a 60% equity stake in the Taiwanese firm (for THB 160 million) to allow it to manage the early stage of the food supply chain. CSLF’s strengths in food service business lies in the firm’s connections with food suppliers from all corners of the world as well as restaurant chains and food retailers, which will enable JWD to expand customer bases both domestically and regionally, with JWD itself serving as the logistics solution provider and multi-country consolidation hub. Payments for and transfer of the shares are expected to be completed in April 2018.
With high growth potential of the regional logistics market, JWD has decided to enter two new regional markets (in addition to Laos, Cambodia, Myanmar, Indonesia and Thailand) by 2018. As for the growing food and cold storage segment, it seeks to build one additional cold storage plant in Vietnam by the second quarter of this year. It also aims to expand its investment presence in the Indonesian cities of Jakarta and Surabaya, after partnering late last year with Samudera Group, a major shipping line in Indonesia, in setting up a joint-venture firm and acquiring a 67% stake in Adib Cold Logistics (or ACL), a Jakarta-based cold storage and cargo transport company. In the CLM segment, it intends to increase by early second quarter of this year its investments in major local firms that provide inland logistics solutions (e.g. cargo warehousing and yard management, dry port, domestic cargo transport and distribution). It eagerly explores opportunities to enlarge its logistics networks both domestically and internationally, especially through investments to penetrate air and sea freight services to facilitate multimodal transport.
Logistics market in Thailand will benefit from the country’s position as an industrial manufacturing base and a regional hub. All main segments of JWD will also profit from the Thai government’s Eastern Economic Corridor (or EEC) policy. The company seeks to invest to expand its fleet and increase the number of trips and covered areas of its cargo transportation and distribution services in both inland and cross-border subsegments in order to tap growths in the cargo transportation business. In the JWD Chemical Supply Chain (JCS) segment, it is installing rackings to increase the storage space by more than 150%. Moreover, to expand the B2C market, it is investing in two additional self-storage sites in the CBD areas of Samyan and Sathorn in Bangkok.
The Chairman/CEO added that, after raising more than THB 1 billion funds from the late last year's sale of assets to AIM Industrial Growth Freehold and Leasehold Real Estate Investment Trust (AIMRT), JWD is now prepared financially. The company is also going to raise additional funds this year by selling 2,800sq m cold storage space at Suwinthawong to the REIT, and is considering issuing debentures, etc., in order to finance expansions and maintain a suitable debt to equity ratio.
"We need to produce constant growths. This year we will receive a revenue share from our co-investment in cold storage business in Indonesia. Our warehousing and cold storage business across Asean will boost international revenue. We aim to raise the international revenue's share to 25% by 2020", said he.