SHENZHEN - Jayud Global Logistics Limited (NASDAQ: JYD), a prominent supply chain solution provider based in Shenzhen, has announced its acquisition of stakes in two logistics facilities in California and a customs brokerage firm in Georgia. These strategic moves are aimed at expanding the company's operational footprint in the United States.
The company has acquired a 20% stake in a 70,000 square foot warehouse in Rialto, California, and a 49% stake in a 50,000 square foot warehouse in Chino, California. These facilities are situated in significant logistics hubs, which are expected to enhance Jayud's ability to manage supply chains effectively in one of the busiest trade corridors in the U.S.
In addition to these warehouse investments, Jayud has secured a 10% stake in LD Global Logistics Inc., a licensed customs broker certified by U.S. Customs and Border Protection. Located in Georgia, LD Global Logistics Inc. offers essential brokerage services and operates a fleet of trucks, bolstering Jayud's logistics operations across the southeastern United States.
The inclusion of LD Global Logistics Inc. into Jayud's portfolio is anticipated to expand its service capabilities and deepen its compliance and customs expertise, aiming to provide smoother and more efficient import and export processes for clients.
To facilitate these acquisitions, Jayud issued a total of 3,365,588 Class A ordinary shares. Xiaogang Geng, Chairman of the Board and CEO of Jayud, stated, "These acquisitions are a testament to our commitment to strengthen our global logistics network and enhance service offerings to our clients, particularly in the U.S. market."
Jayud Global Logistics Limited is known for its comprehensive range of cross-border supply chain solutions, including freight forwarding, supply chain management, and other value-added services. With a global operation nexus and strong service capabilities, the company is positioned to meet the growing demand for efficient, reliable supply chain management in North America.
The information in this article is based on a press release statement.
InvestingPro Insights
Jayud Global Logistics Limited's recent strategic acquisitions in the United States align with its growth ambitions, but the company faces significant financial challenges. According to InvestingPro data, Jayud's revenue for the last twelve months as of Q4 2023 stood at $70.14 million, with a concerning revenue decline of 23.64% over the same period.
InvestingPro Tips highlight that Jayud is "quickly burning through cash" and "not profitable over the last twelve months." These factors are particularly relevant given the company's recent expansionary moves, which may require substantial capital investment. The tip noting that "short term obligations exceed liquid assets" further underscores the potential financial strain these acquisitions could place on the company.
On a more positive note, Jayud has shown strong short-term market performance. InvestingPro data reveals a 14.84% price return over the past week and a 30.83% return over the last three months. This recent stock price momentum could potentially provide the company with improved access to capital markets if needed to support its expansion strategy.
It's worth noting that InvestingPro offers 14 additional tips for Jayud Global Logistics, providing investors with a more comprehensive analysis of the company's financial health and market position. These insights could be particularly valuable in assessing the long-term implications of Jayud's recent strategic moves in the U.S. logistics market.
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