Kuehne + Nagel heading for a good year

Kuehne + Nagel posted record nine month results on the back of strong air and ocean freight out of Asia.

The Swiss logistics giant saw its operating result reach US$281 million in the third quarter, the highest in the firm’s history. Net profit was $466 million.

Reinhard Lange, CEO of Kuehne + Nagel International, said: “Due to the very good results of the past nine months – and particularly in the third quarter of 2010 – we are confident we will achieve a strongly improved result for the full-year.”

In sea freight, the company said in a statement that during the first nine months of 2010, it maintained high-level container volume with a 17 percent increase.

Growth in the global seafreight market, however, softened in the third quarter. Kuehne + Nagel’s increased sales and marketing activities contributed significantly to further market share gains, it said.

In the first nine months, the EBITDA-to-gross profit margin grew from 32.5 percent in the previous year to 35.8 percent in 2010, mainly due to additional productivity increases.

Kuehne + Nagel increased air freight tonnage by 29 percent in the first nine months, although growth in the international airfreight market had slowed in the middle of the year. The company was able to considerably increase volumes and market share, especially in the trade lanes from and to Asia.

At the same time, the company benefited from its service offerings tailored to specific industries, such as pharmaceuticals, high-tech and perishables. Increased productivity and efficient cost management contributed to an improved EBITDA-to-gross profit margin by 30.5 percent (previous year: 29.3 percent).

In the first three quarters of the year, Kuehne + Nagel’s European overland activities registered a growth in net turnover of 9.5 percent. Despite high investments into the expansion of the European network and the opening of new locations, the operational result and EBITDA margin to turnover remained stable.

The recovering domestic economies of the leading industrial nations led to a stabilisation of the contract logistics market; Kuehne + Nagel’s net turnover remained at the previous year’s level.

EBITDA decreased in the first nine months by 13.2 percent partly due to currency adjustments (6.6 percent) and start-up costs for new businesses as well as restructuring activities in the US and Canada.

Contract logistics activities in the emerging economies of Asia and Eastern Europe improved. Investments in Asia have started to pay off and led to positive results for the first time.
(Source:www.cargonewsasia.com)