KN focuses on profitable business in the maritime freight segment

Kuehne + Nagel defying the challenging environment in the year 2015 showing increased profitability and a new record result

KN focuses on profitable business in the maritime freight segment

For the globally operating Kuehne + Nagel Group 2015 was once again a successful year. Profitability further increased leading to a new record result in earnings for the year. Due to the strong Swiss Franc, net turnover of CHF 16,731 million was 4.4 percent below the previous year, whereas gross profit remained at last year’s level. The operational result (EBITDA) increased by 3.6 percent to CHF 1,041 million. The EBIT margin amounted to 5.1 percent and exceeded the target ahead of time. Earnings for the year improved by 5.4 percent (in constant currencies by 12.7 percent) to CHF 679 million.

In the seafreight business, Kuehne + Nagel handled 3.8 million TEU, the same quantity as the previous year but with improved profitability: gross profit per TEU increased by 5.2 percent and the EBIT-to-gross profit margin (conversion rate) rose from 30.3 percent to an impressive 33.2 percent. Whereas the growth in European exports stagnated due to regional differences in demand, Kuehne + Nagel clearly increased volumes in trades to and from North and South America. With regard to specialised solutions such as reefer container and LCL (Less-than-Container-Load), Kuehne + Nagel gained further market share and strengthened its leading position.

In airfreight, Kuehne + Nagel remained successfully on course in a stagnant to slightly declining global market. The company increased its tonnage by 4.7 percent to 1,250,000 tonnes, thereby reaffirming its position as the second largest global airfreight forwarder. A key factor in the good performance was the focus on industry-specific airfreight solutions, which led to significant business wins in the pharmaceutical, aerospace and perishables sectors. KN FreightNet, the innovative online portal, proved to be an effective new sales channel. Customers worldwide can receive instant quotes for airfreight services, place bookings and track shipments.

The operational performance in overland remained stable despite the challenging market situation in Europe. The groupage activities in Germany, France and the UK were successfully expanded. The new workflow concept for less than truckload (LTL) and full truckload (FTL) shipments contributed to the pleasing development of this business unit. Kuehne + Nagel’s acquisition of ReTrans, a U.S.-based provider of multimodal transportation management solutions, in August 2015 marked an important step in the expansion of activities outside Europe.

Kuehne + Nagel’s industry-specific end-to-end solutions met with high demand in the market, as confirmed by the new business wins in 2015 with an additional warehousing space of some 860,000 m2. The three strategic initiatives – focused growth, continual process improvement and Master Location Plan – prove to be effective. In the year under review, Kuehne + Nagel managed a total of over 9.5 million m2 of warehouse and logistics space for its customers worldwide. At the same time, the idle space was reduced from 4.2 percent to 3.5 percent. Net turnover from contract logistics saw a currency-adjusted increase of 5.5 percent, placing it above the market average.

With over 67,000 employees at more than 1,200 locations in over 100 countries, the Kuehne + Nagel Group is one of the world’s leading logistics companies. Its strong market position lies in the seafreight, airfreight, contract logistics and overland businesses, with a clear focus on providing IT-based integrated logistics solutions.