Management of Kuwait’s airports and ports could be the best news for the Gulf’s largest logistics firm in recent months as it examines channels to raise turnover
Agility has announced it is keen on capitalising on Kuwait government plans to privatise state institutions should they materialise,
Kuwait’s Finance Minister Anas Al Saleh said last month the government is contemplating placing key airports, ports and some facilities of Kuwait Petroleum Corporation in non-government hands. Agility’s chief executive Tarek Sultan quickly reacted saying his company would be interested in bidding for management of the airports and ports.
Kuwait is burdened by a budget deficit caused mainly be low oil prices but it is believed placing some prime assets under management would achieve both cost cutting and greater efficiency.
Kuwait has slapped a 10 per cent tax on corporate profits. Sultan said the private sector would not mind the tax if the government also introduced reforms.
Sultan has listed Iran and Egypt as promising markets. Agility is seeking entry into Iran’s market following the withdrawal of some sanctions there and believes Egypt, where Agiity operates a logistics and distribution centre, would be a better venue for business if authorities there could remove difficulties for money transfers.
Sultan also said Agility was in the final stages of securing $800 million in financing from regional and foreign banks. The funds would go towards investing in a shopping mall in Abu Dhabi being developed in partnership with Kuwait’s National Real Estate Company, he said.
United Projects for Aviation Services Company, a subsidiary of Agility, last year signed an agreement to invest up to $225 million in the Reem Mall project.
Last January Agility confirmed it had signed a three-year $235 million loan agreement with the National Bank of Abu Dhabi, HSBC, Natixis, Santander and Standard Chartered. Sultan had said earlier that his company was focusing on diversifying its business across emerging markets as low oil prices risked delays in some Middle East projects.
Agility has expressed general optimism about its prospects, saying it expects revenues to more than double in by 2020. Sultan stated last year that by 2020 the company expects to show revenue of $10 billion to $15 billion with earnings before interest, tax, depreciation and amortisation (Ebitda) of $1 billion. At the time he made the remark in November 2015, annual revenue was around $5 billion with Asia accounting for $1.5 billion, the Middle East and Africa $1 billion and the rest coming from Europe and the Americas.
In recent months, Agility has won contracts from events companies to handle logistic freight. One of the contracts to Agility Fairs & Exhibitions came from the organisers of Gastech Conference & Exhibition and is valid for the event’s editions in 2017 and 2018. The first of these takes place in Japan. Agility’s relationship with Gastech goes back many years.
The company has been appointed as the official freight and on-site handling contractor at the inaugural Automechanika Birmingham show, which takes place in June in Birmingham, UK, and at three major defence shows organised by Abu Dhabi National Exhibitions Company (Adnec): the 2017 and 2019 editions of the International Defence Exhibition and Conference (Idex), the Naval Defence and Maritime Security Exhibition (Navex) and the 2016, 2018 and 2020 editions of the Unmanned Systems Exhibition and Conference (Umex).