K+N first quarter airfreight volumes fall 3.1% in a ‘declining market’

Kuehne + Nagel (K+N) saw 2019 first quarter airfreight volumes fall 3.1% to 409,000 tonnes, citing “significant increases in tonnage in the previous years” against the backdrop of “a declining market”.

The world’s largest freight forwarding group recorded a net turnover rise of 7.7% to SFr5.2bn in the first three months of this year, while gross profit rose 7.3% to SFr1.9bn and earnings before interest and tax (EBIT) edged 2.5% up on like period 2018, although group earnings fell 1.6% to SFr181m.

K+N International chief executive Detlef Trefzger said: “Kuehne + Nagel got off to a good start in 2019. Once again, we increased our net turnover, gross profit and EBIT. However, we find ourselves in an environment in which global economic growth is noticeably slowing.”

On its quarterly airfreight result, Switzerland-based K+N said: “The market-related volume decline in airfreight was largely offset by active cost management.”

It added: “Following significant increases in tonnage in the previous years, the airfreight volume dropped slightly by 3.1% to 409,000 tonnes in the first quarter of 2019 against the backdrop of a declining market.”

It stated that the airfreight business unit “developed nearly in line with the overall airfreight market, which declined by 2-3%”.

Since the start of the year, the group has integrated the business operations of Quick International Courier – a provider of time-critical transportation and logistics solutions for the pharma and healthcare and aviation industries – which had contributed to “a significant increase in gross margin”.

The airfreight unit’s EBIT reached SFr80m, which was “almost consistent with the very high level of the previous year.”

In seafreight, K+N said that EBIT “expanded significantly” and in overland operating results increased substantially.  The result of contract logistics decreased due to ongoing restructuring and review of the project portfolio, “Overall, the group achieved a good result”.

Trefzger added: “In this volatile market environment we are well positioned. Consistent with our business strategy, we focus on introducing new digital platforms and highly specialised industry solutions. For 2019, we plan to remain on course to grow as a Group and further increase our results.”