China’s Loctek Drops After Unveiling Second US Warehouse Plan in Six Months
Tang Shihua
DATE:  11 hours ago
/ SOURCE:  Yicai
China’s Loctek Drops After Unveiling Second US Warehouse Plan in Six Months China’s Loctek Drops After Unveiling Second US Warehouse Plan in Six Months

(Yicai) Dec. 4 -- Shares of Loctek Ergonomic Technology fell after the Chinese home furnishings company announced a second plan in less than six months to build a warehouse in the United States amid growing China-US trade frictions.

Loctek [SHE: 300729] closed 3.8 percent down at CNY16.91 (USD2.33) a share in Shenzhen today. The stock has fallen 5.6 percent since the end of last year.

Loctek will invest USD97 million to build a warehouse in California to better serve its cross-border e-commerce clients, the Ningbo-based company announced yesterday, citing a deal it signed with local builder Arco National Construction Pacific Coast.

The warehouse, expected to be completed in April 2026, will be built on an area of 1.2 million square feet on the southeastern corner of Lafayette Road and Dale Evans Parkway in Apple Valley, Loctek noted.

Providing overseas warehousing services has become a key strategy for Loctek, with fast-growing transborder e-commerce stoking demand, the firm said. Building overseas warehouses will help reduce operating costs, improve services, and enhance core competitiveness, it added.

Warehouses, which are used to store goods until they are ready to be sold or distributed, are critical for reducing shipping times, costs, and logistical challenges for e-commerce sellers.

Loctek initially sold large household and office supplies. It started providing all-round cross-border logistics services, including warehousing, in 2020. Its clients are mostly online merchants selling mid-sized and large products across jurisdictions and international trade firms.

On June 17, Loctek announced it would invest USD78 million to build a warehouse in the US state of Georgia. The project, expected to be completed by the end of next year, will be designed and built by Chicago-based builder Clayco.

In the first half of the year, Loctek’s revenue from overseas warehousing surged 129 percent to CNY851 million (USD117.1 million) from a year earlier, accounting for 35 percent of its total income, according to the firm’s semiannual earnings report. The business’ gross profit margin widened to 15 percent from 12.7 percent.

Loctek handled four million parcels in the six months ended June 30, a year-on-year jump of 120 percent. As of July 31, the firm had 17 self-operated warehouses abroad covering about 5.2 million square feet, including eight in the US.

Editor: Futura Costaglione


 

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Keywords:   Capacity Expansion,New Warehouse,Third Party Warehousing Services,Cross Board E-Commerce,United States,Loctek Ergonomic Technology