Century Logistics executive director Edwin Yeap: “We are looking to expand our group through mergers and acquisitions."
PETALING JAYA: Century Logistics Holdings Bhd is looking to acquire a mid-sized logistics and parcel delivery company with presence in major towns.
The plan for Century Logistics to offer last-mile delivery services is on track, as the group has obtained a three-year licence from the Malaysian Communications and Multimedia Commission that would enable courier services operations for the group.
Century Logistics executive director Edwin Yeap said the group was searching for a mid-sized logistics company to be acquired.
He explained that it was not feasible for Century Logistics to build a courier service network from scratch, as it would take a longer time for the group to build its network for last-mile delivery services.
“We are looking to expand our group through mergers and acquisitions in line with CJ Korea Express Asia Pte Ltd’s aspiration to be a top five logistics player in the world by 2020,” Yeap(filepic below) told StarBiz.
The South Korea-based CJ Korea Express, which is a wholly owned subsidiary of CJ Logistics Corp, is currently the largest shareholder in Century Logistics with a 31.44% equity stake.
CJ Logistics, one of the world’s largest logistics groups, is the dominant parcel delivery company in South Korea with offices in more than 50 countries.
With the addition of last-mile delivery services to its portfolio, Century Logistics will be a fully-integrated logistics company going forward.
Century Logistics offers an array of logistics services, from halal, oil and contract logistics to international freight forwarding, as well as transportation management and distribution.
Courier systems are last-mile services or the last leg of a logistics supply chain, while logistics encompasses the entire chain of operations right before last-mile services.
In an earlier article, Yeap was quoted as saying that companies that have integrated logistics like Pos Malaysia Bhd and GD Express Carrier Bhd have shown good results.
According to Century Logistics’ 2016 annual report, the group will roll out CJ Logistics’ technology, engineering, system and solution, as well as expertise in the parcel delivery business, combined with Century Logistics’ nationwide network and branding.
Century Logistics and CJ Logistics will benefit from the sharing of key logistics hubs and networks, cross-selling and new business opportunities.
E-commerce will be the driver of Century Logistics’ growth in the coming years, as the group is expected to ride on the momentum of the booming scene in Malaysia.
“E-commerce is projected to grow at a 11% compounded annual growth rate until 2020, but it can be accelerated with focused interventions by the Government through the national e-commerce strategic roadmap,” it said.
For the financial year ended Dec 31, 2016, Century Logistics’ net profit fell 11.4% year-on-year due to the competitive domestic environment.
As of Dec 31, 2016, the group managed a logistics facility portfolio of 2.2 million sq ft, of which 1.5 million sq ft were self-owned.
Of this total, Century Logistics manages 1.3 million sq ft in Port Klang, Subang and Shah Alam. The construction of a three-storey warehouse measuring 450,000 sq ft in the Eastern Gateway Industrial Hub in Klang is underway and due for completion by the second quarter of 2018.