Swift Haulage earnings hinge on GVL turnaround and cross-selling synergies

Swift Haulage's earnings could potentially improve due to a turnaround in Global Vision Logistics (GVL) and cross-selling synergies as utilization increases, according to Maybank Investment Bank Bhd (Maybank IB). However, margin volatility, high overhead costs, and increasing price competition might hinder the company's earnings upside.

The logistics firm remains cautiously optimistic, driven by warehouse expansions and the launch of GVL and its new cold chain logistics joint venture (JV). These initiatives have led to higher initial costs and wider associate losses as they strive to boost utilization. Maybank IB expects these issues to resolve as revenue contributions grow, supported by cross-selling synergies across other segments.

The company's core net profit rose 28% year-on-year to RM23.1 million for the nine months ending September 2026, despite flat revenue at RM580.4 million, exceeding analyst expectations and beating consensus estimates. Container haulage and freight forwarding were the primary contributors to earnings growth, with container haulage EBIT up 52% to RM24.4 million, driven by higher revenue and potentially stronger rates, while freight forwarding EBIT increased 20% to RM36.3 million due to greater project cargo demand.

Maybank IB has maintained its earnings forecasts and target price of 35 sen, based on an unchanged 7.0 times enterprise value-to-earnings before interest, taxes, depreciation, and amortisation. The firm upgraded Swift Haulage to "Hold" from "Sell," anticipating growth from their expansion initiatives amid ongoing cost and margin pressures.