Airfreight demand on the up at Panalpina
25 / 10 / 2016
Panalpina enjoyed a bumper period for airfreight during the third quarter, while group revenues declined and profits increased.
The Switzerland-based freight forwarder recorded airfreight volume growth of 10% year on year during the third quarter to 228m tonnes, while for the first nine months demand is 9% ahead of last year at 659m tonnes.
Panalpina attributed the increases in airfreight demand achieved so far this year to its acquisition of perishables business, Airflo, which contributed 6% of the growth, while new business accounted for the remaining 3%.
The company estimated that during the first nine months the overall airfreight market had shrunk by around 1%.
While airfreight volumes increased, gross profits per ton of cargo transported came under pressure and declined by around 7% in the third quarter. It also said the acquisition of Airflo took its toll on gross profits per ton.
However, the extra volumes carried meant that overall airfreight gross profits were up by 2%.
Overall revenues at the company declined by 13.7% year on year in the third quarter to Sfr1.3bn, operating profit was up 2.6% to Sfr32.9m and net profits increased 2.7% to Sfr24.6m.
Panalpina chief executive Stefan Karlen said: “Despite shrinking air and ocean freight markets and high margin pressure in the first nine months of the year we delivered an improved earnings before interest and tax and consolidated profit (both adjusted for one-offs).
“Continued high cost discipline, particularly in the third quarter, made this achievement possible. Our airfreight and ocean freight products developed contrarily.
“In airfreight our volumes increased by 9% while they decreased by the same amount in ocean freight. This resulted in a practically unchanged overall gross profit when compared to last year.”
While also beating the overall market, the performance in air demand growth was also better than that of Kuehne + Nagel which saw a 3.8% improvement in the third quarter, although it does process more airfreight than its Switzerland-based rival.
