QEX Logistics says it more than tripled first-half sales, near quadrupled first-half net profit and is on track to achieve its annual sales target of $60 million.

The cross-border logistics company says sales for the six months ended September rose to $32.4 million, exceeding the $31.5 million revenue earned in the previous full year.  

Net profit rose to $1.25 million from $345,000 in the same six months last year.

QEX, which operates in New Zealand, Australia and China, specialising in delivering parcels to China for online business sellers in New Zealand and on selling milk powder that is delivered into China, listed on NZX’s unsuccessful third attempt at developing a second board, NXT, in February and migrated to the main board in October.

The company says its milk powder sales rose to $24.5 million in the latest six months from $7.8 million in the same six months last year.

It trialled selling health supplements and achieved sales of $1.54 million in the six months but said margins weren’t sufficient to warrant continuing.

Its revenue from international parcel delivery, logistics and customs clearance doubled to $3.2 million.

Year-to-date gross margin rose to $3.95 million, up by $2.45 million on the previous first half, but the percentage gross margin eased to 12.2 percent from 13.9 percent.

Nevertheless, the company said it is on track to achieve 14 percent for the full year.

“The market for dairy products continues to be very competitive and there have been occasions where competitors have offloaded product at minimal margin to generate cash flows,” it said.

The company started a new business in March with two other equal shareholders called ANZ Brand House which was granted the New Zealand distribution rights for Munchkin Grass Fed Infant Formula and accessory products.

It said this new company’s results aren’t significant at this stage.

Canterbury-based Synlait Milk manufactures the Munchkin products. Synlait has been trying to get US FDA approval for the infant formula for well over a year and earlier this month said it has to re-submit its application and expects the process will take about 24 months.

QEX raised a further $2.5 million from a share placement to wholesale investors in August and its bank borrowings have increased to $6.2 million at Sept. 30.

It had $1.4 million in cash at the balance date.

The shares are unchanged at $1.28, valuing the company at $67.2 million, and have risen from as low as 37 cents in February but are down from their high at $1.55 in October. The August placement was at $1.15 per share.

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