Hong Kong-listed ESR Cayman posts revenue rise, says e-commerce logistics property to grow thanks to pandemic
- Company reports 40.6 per cent rise in revenue for 2019 to US$357 million, 20.8 per cent rise in net profit to US$245 million
- Unaffected by spread of virus to EU, US as 99 per cent of business is focused around domestic consumption, chairman says
E-commerce will continue to grow in the Asia-Pacific region, accelerated by the Covid-19 outbreak, Hong Kong-listed logistics warehouses and industrial real-estate operator ESR Cayman said on Monday.
In its year-end earnings web conference, the company also reported a 40.6 per cent rise in revenue for 2019 to US$357 million. Its net profit climbed 20.8 per cent to US$245 million.
Jeffrey Perlman, ESR’s chairman, said that Asia-Pacific logistics remained the largest property investment opportunity in the region, adding that its e-commerce tenants remained the bedrock of ESR’s business, constituting about 60 per cent of its clients. He also said he did not expect a slowdown in business due to the spread of the virus to the European Union, the United States and other import-focused markets, as “99 per cent of our business is focused around domestic consumption”.
He cited reports that Chinese e-commerce giant JD.com expected a 10 per cent rise in revenue for first quarter of 2020, despite the impact of the coronavirus on China’s economy. JD is ESR’s largest tenant, responsible for 11.1 per cent of its rental income.
Perlman also suggested further investment in logistics real estate would be forthcoming from ESR, even in 2020. He said the company was in a relatively strong position as far as cash was concerned, with US$2 billion in dry powder waiting to be deployed, likely in tier-1 Asian cities.
