QEX adds Open Country, Swisse to China client base

Tuesday 26th March 2019

QEX Logistics has added Open Country Dairy and Hong Kong-listed Swisse Wellness to its product distribution network in China.

Open Country, New Zealand’s biggest independent dairy processor, will have QEX distribute its organic whole-milk powder direct to Chinese consumers for an open-ended term and on a non-exclusive basis.

Auckland-based QEX facilitates the storage, supply, packaging, customs clearance and delivery of New Zealand and Australian products bought from stores, online and e-commerce sites by individual consumers from China or through a so-called daigou. The daigou are essentially an army of informal traveling shopping agents who buy products in Australasia for sale in China.

The agreement with Swisse, a leading health supplement brand in Australia and New Zealand, will see QEX provide distribution, storage and logistics export services for the Biostime organic infant formula brand being offered through online and cross border e-commerce platforms into China. The arrangement is also open-ended and non-exclusive.

QEX shares rose 4.8 percent to $1.10 – a five-week high.

The firm’s main business is sending New Zealand milk powder and infant formula to Chinese customers. In January it inked a distribution agreement with French food-maker Danone.

Chief executive Ronnie Xue said today’s agreements, and the earlier deal with Danone, reflect the company’s strategy to diversify and strengthen its earnings from a broader range of leading brands.

“The three agreements signed this year follow the establishment of our bonded warehouse in Shanghai late last year, which has significantly strengthened our proposition to New Zealand exporters seeking to strengthen their distribution capability into the Chinese consumer market.”

QEX reported revenue of $32.4 million in the six months to Sept. 30 and previously forecast full-year revenue of $60 million.

QEX says the Open Country Dairy and Swisse distributor agreements will have a positive impact on future revenue, but no material impact during the current March financial year.

(BusinessDesk)

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