Mahindra Logistics profit drops 55% in Q1 FY25

MUMBAI : Mahindra Logistics Ltd (MLL) on Monday said its standalone profit fell 55 per cent to Rs 10.15 crore in June 2024 quarter due to higher startup costs, expenses on manpower and warehouse leasing.

The logistics arm of the Mahindra Group had posted a standalone PAT (profit after tax) of Rs 22.90 crore in the first quarter of FY24, according to a regulatory filing.

The revenue during the quarter under review, however, rose 10 per cent to Rs 1,156.66 crore from Rs 1,050.92 crore in the year-ago period.

Contract logistics experienced a 9 per cent revenue growth year on year in Q1 FY25, while freight forwarding business saw a 12 per cent increase quarter on quarter, driven by a growth in demand for inbound ocean cargo, the company said.

The company said its express business saw an improvement of 2 per cent YoY in terms of revenue and a 16 per cent decline in PAT losses driven by continuous cost optimisation.

At the same time, mobility and last-mile delivery continued their improvement journey, MLL said, adding that warehouse space under management in the third-party logistic (3PL) business stood at over 20 million square feet.

“Despite the muted demand environment, the quarter gone by saw healthy order booking in 3PL and cross border business. The cross-border business saw good traction, driven by a growth in demand for inbound ocean cargo,” said Rampraveen Swaminathan, Managing Director and CEO at Mahindra Logistics Ltd.

The mobility, last mile delivery and auto outbound logistics business 2×2, continued their improvement journey and delivered a healthy performance, he said.

“Earnings were impacted due to extended startup costs, coupled with higher manpower and warehousing lease costs. The Express business was impacted by lower volumes, which was offset by our cost optimization initiatives. We expect to see strong improvement in the overall operating performance in the later part of the year,” Swaminathan said.