BARCELONA - Freightos, a prominent digital booking and payment platform for the international freight industry, has expanded its WebCargo service by integrating Hainan Airlines (HNA Cargo) into its offerings. This move brings a significant increase in available capacity for freight forwarders operating in the Asia Pacific and Europe regions. The announcement was made today, and the new partnership is expected to bolster Freightos' presence in the air cargo sector.
HNA Cargo is recognized as a leading airline in China, ranking in the top five, and its collaboration with Freightos' WebCargo platform underscores the growing trend of digitalization in the freight industry. With the addition of HNA Cargo, Freightos now provides access to three of China's four major air cargo carriers, including China Southern and China Eastern, making up 65% of the global capacity on the platform.
The integration is set to first roll out in key North Asian and Southeast Asian markets like Japan, Singapore, Vietnam, and Thailand. The digital payment solution offered by WebCargo now supports transactions with HNA Cargo, allowing forwarders to book and pay for shipments through a unified interface, bypassing the need for an IATA license or a bank guarantee. Various payment methods, including credit lines, credit cards, and prepaid options, are available.
HNA Cargo operates an extensive network with over 600 aircraft across 11 airlines, covering more than 2,000 routes and serving over 300 cities globally. The company plays a critical role in international and domestic belly cargo, transporting perishables and specialized goods.
Joyce Tai, Freightos' EVP of Worldwide Partnerships, emphasized the strategic importance of enhancing Asian air cargo coverage for forwarders. Qiushi Zheng, Vice President at HNA Cargo, highlighted the partnership's alignment with their digital strategy and its potential to leverage their extensive capacity to meet market needs.
Freightos, listed on NASDAQ under the ticker CRGO, is recognized for digitizing the trillion-dollar international freight industry and offering a suite of software solutions for pricing, quoting, booking, shipment management, and payments. The company also provides real-time industry data through Freightos Terminal, including the Freightos Air Index (FAX) for air cargo and Freightos Baltic Index (FBX) for container shipping.
This expansion is based on a press release statement and marks a significant step for Freightos as it continues to connect airlines, ocean carriers, freight forwarders, importers, and exporters, facilitating more efficient and resilient global trade.
In other recent news, Freightos, the digital freight platform, reported a strong second quarter, marked by a 32% surge in transactions and a 31% increase in gross booking value. The company's revenue for the quarter also increased by 11%, reaching $5.7 million. Oppenheimer, in response to these developments, adjusted its price target for Freightos to $3.50 from the previous $4.50 but maintained an Outperform rating on the stock. This revision followed Freightos' second-quarter results and a reduced forecast for full-year 2024 gross booking volume by 1%, due to economic challenges in Europe and delays in airline partnerships.
Freightos also announced the strategic acquisition of Shipsta, a freight-tender procurement platform, which is expected to add $800,000 in revenue in the second half of 2024 and between $4 million to $5 million in 2025. Despite a decrease in the second half's transactions, Freightos reiterated its target to achieve positive EBITDA by the end of 2026. The company's financial outlook includes a 1% increase in revenue for 2024 and a 7% rise for 2025, reflecting the contributions from the Shipsta acquisition.
Furthermore, Freightos expanded its platform by adding 14 carriers, bringing the total to 51, and saw a 16% increase in buyer users. These are recent developments that highlight the company's commitment to growth and operational efficiency.
InvestingPro Insights
Freightos (NASDAQ: CRGO), known for revolutionizing the freight industry through digitalization, has shown a robust gross profit margin in recent performance metrics. According to InvestingPro data, the company's gross profit margin for the last twelve months as of Q2 2024 stands at an impressive 61.27%. This figure not only reflects Freightos' ability to maintain a strong markup on its services but also indicates the company's potential to sustain profitability as it scales its operations.
Despite the company's strong gross profit margins, analysts have cast doubt on its short-term profitability. One of the InvestingPro Tips for Freightos suggests that analysts do not expect the company to be profitable this year. This may be attributed to the company's significant operating income margin deficit of -115.45% for the same period, highlighting challenges in managing operating expenses relative to revenue.
InvestingPro data also reveals a market capitalization of $64.78 million USD, which, when paired with the company's recent expansion efforts, could signal an opportunity for investors eyeing growth potential in the logistics technology sector. However, it's worth noting that the company's price has experienced a downward trend, trading near its 52-week low and reflecting a 37.29% price of its 52-week high. For investors considering Freightos as a potential addition to their portfolio, it's crucial to weigh these dynamics, and they can find more in-depth analysis and additional InvestingPro Tips at InvestingPro Freightos, where 12 more tips are available to help inform investment decisions.
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