Swift Haulage Downgraded to Neutral as Margins Weaken Despite Revenue Growth

Swift Haulage Berhad (5303 | SWIFT MK), a key player in transportation and logistics, has been downgraded to Neutral from Buy after its 2QFY25 core PATAMI fell short of expectations. Earnings came in at RM12.8 million for 1HFY25, representing only 41% of full-year forecasts as margins came under pressure. The container haulage segment lagged, with revenue slipping -1.6% YoY amid softer cargo volumes and stiff competition. Land transportation posted +14.4% YoY revenue growth but saw EBIT decline on shorter hauls. Meanwhile, freight forwarding surged +50.9% YoY on project cargo. Target price remains unchanged at RM0.43.

Swift Haulage Berhad (5303 | SWIFT MK)

2QFY25 Results Review – Margins Under Strain
Call: Downgrade to NEUTRAL (from BUY)
TP: RM0.43 (unchanged)

Earnings Missed: 1HFY25 core PATAMI RM12.8m, only 41% of full-year forecasts.
Dividend: First interim dividend 0.8 sen, ~55% payout.
Segment Performance:
- Container Haulage: -1.6% YoY revenue, -17.4% YoY EBIT → softer gateway cargo + competition.
- Land Transportation: +14.4% YoY revenue, but EBIT -24.6% YoY due to shorter-haul trips.
- Freight Forwarding: +50.9% YoY revenue, boosted by project cargo.
- Warehousing: Expected improvement from added capacity & utilisation.
Margins: Core PATAMI down -25.2% QoQ; EBIT margin narrowed -1.0 ppt.
Outlook: Container haulage may gain from axle load rules; warehousing to benefit from capacity expansion.