CEO claims that ‘against the backdrop of consistently tense global markets, Kuehne + Nagel once again delivered very solid results’.
Global forwarder Kuehne + Nagel (K+N) reported a 4.3% rise in deep sea container volumes for the first nine months of 2019 in a “stagnating” industry sector, although airfreight volumes dived 6.4% in “consistently tense global markets”.
Detlef Trefzger, chief executive of Switzerland-based K+N International, said: “Against the backdrop of consistently tense global markets, Kuehne + Nagel once again delivered very solid results.”
Group net turnover increased by 3.1% year-on-year to CHF 15.8 billion, gross profit by 4.4% to CHF 6.0 billion, EBIT by 6.6% to CHF 794 million and earnings for the period by 3.1% to CHF 598 million. Organic net turnover growth amounted to 4.3%, foreign exchange effects had a negative impact of 2.9%, and acquisitions a positive effect of 1.7%.
“In seafreight and overland in particular, our focus continued to be on customer service, cost efficiency and digitalisation,” Trefzger said. “In the more volatile airfreight business, earnings remained stable over the past quarters, with the acquisition of Quick having had a sustained positive impact.ˮ
The seafreight division handled 3.7m standard containers (TEU), some 152,000 units more than in the same nine-month period of 2018. With an increase of 7.3% year-on-year to CHF 5.6 billion, seafreight posted “a very solid net turnover growth and once again improved its performance in the third quarter”. The business unit improved its conversion rate (ratio of EBIT to gross profit) to 30.4%, “maintaining its position at the top of the industry”.
K+N said that the airfreight market continued to decline in an environment of “global economic uncertainty and rising trade barriers”.
K+N’s airfreight volume in the January to September period fell by 6.4% year-on-year to 1.22m tonnes after a “sharp drop” in demand in some key industries, although business unit was able to “significantly” increase gross profit, especially in the areas of pharma and healthcare, perishables and time-critical shipments. The company said the division’s 3% year-on-year decline of EBIT to CHF 263 million “was resilient in light of persistently challenging market conditions”.
Despite the slowdown in global trade, the overland business unit again grew “well ahead of the market,” with groupage shipment volumes in France and Germany remaining firm.
Contract logistics saw “significantly slower” growth in the period due to “portfolio optimisation measures and a focus on higher-margin business”.
With the opening of new distribution centres in Luxembourg, Germany and Belgium, the business unit focused on” high-quality growth” in the areas of pharma and healthcare, and e-commerce fulfilment.
Source: Lloyd’s
