2GO Group says business may start to recover in latter part of 2021
By Arjay L. Balinbin, Senior Reporter
WITH the coronavirus vaccine rollout seen happening soon, 2GO Group, Inc. expects its business to start recovering in the latter part of the year, its chief operating officer said.
The vaccine rollout “will improve our business outlook as travel accounts for about 15% to 17% of our business,” 2GO Group Chief Operating Officer Waldo C. Basilla told BusinessWorld via e-mail on Feb. 23.
“However, we’re expecting it to happen in the latter part of 2021,” he added.
The vaccine rollout is seen to result in a more lenient transportation system and more people getting employed and going to work.
“The opening up of the economy will also drive manufacturing and consumption. This will allow us to support our customers in production, as well as allow us to support the transportation of finished goods for both B2B (business-to-business) and B2C (business-to-customer),” Mr. Basilla said.
The pandemic crisis has forced 2GO to look at its business in a different way. “We organized our business to cater to the ‘new normal’ or the ‘next normal,'” Mr. Basilla noted.
“We have rationalized our business and streamlined our operations to achieve a much lower cost base. We have introduced specialized solutions that are relevant to the ‘next normal,’ and more importantly, we have also introduced new technology on warehousing and transportation that increases product availability, time to market, and product visibility,” he explained.
The company sees the length of recovery to be a critical challenge. “I think it’s not going to be immediate, so we have to be financially prudent, while we continue driving operational efficiencies,” Mr. Basilla said.
“We also need to continuously innovate to meet the new demands of the market, and continuously win,” he added.
2GO Group announced last week that it recently started servicing pharmaceutical and e-commerce companies with its “alternative to air freight” called 2GO CabinCargo.
The company’s new service promises to deliver products to consumers at the key ports of the Visayas and Mindanao “within five days.”
The listed company’s total revenue for the first nine months of 2020 stood at P13.69 billion, 15.6% lower than the amount reported in the same period in 2019.
2GO Group saw its nine-month shipping revenues drop 45.1% to P3.06 billion. Revenues from logistics and other services went down 14.5% to P4.29 billion, while the goods segment generated P6.33 billion, 12.7% higher than the previous year’s figure.
The company said its various business units have been “significantly affected” by the community quarantine measures, which resulted in limited business operations.