K+N airfreight volumes fall 5.8% in first half 2019

Kuehne + Nagel (K+N) saw first half 2019 airfreight volumes fall 5.8% to 813,000 tons, blaming “stagnating markets” in some key industries and an “under pressure” global air cargo sector hit by growing trade barriers.

At SFr174m, K+N’s airfreight division saw its EBIT down by 4.4% compared to the 2018’s like six month period period.

Detlef Trefzger, chief executive of Kuehne + Nagel International, said: “Currently our focus is on addressing the significant changes in airfreight market conditions.”

The decline in K+N’s airfreight volumes contrasts with Swiss rival Panalpina which recorded a 5% year-on-year increase in first-half airfreight tonnage to 512,000 tonnes despite competitors targeting its volumes and the overall market downturn.

However, Panalpina’s air revenues declined by 2.6% to SFr1.5bn and gross profit was down by 4.9% to SFr337m. in the first half of 2019 versus prior year.

In its half year divisional results K+N stated: “The global airfreight market continued to be under pressure in an economy characterised by growing trade barriers. Due to the stagnating markets of some key industries, the Group’s airfreight volume decreased by 5.8% to 813,000 tons compared to the same period of the previous year.

“However, growth was achieved with industry solutions for pharma & healthcare, as well as for perishables. Quick International Courier, one of the market leaders in time-critical transport and logistics services for the pharma & healthcare and the aviation industries, was integrated successfully. At SFr174m, EBIT was down by 4.4% compared to the previous year’s period.”

K+N’s seafreight volume grew by 4.5% in the first half of the year, outpacing the overall market managed a 2.5% rise. With 2.4m TEU, the Group managed 103,000 units more than in the same period of the previous year.

The Kuehne + Nagel Group increased net turnover by 5.3%, gross profit by 5.5% and EBIT by 2.0% compared to the previous year’s period.

Trefzger added: “The Kuehne + Nagel Group achieved a high level result in the first half of 2019. This was due to the consistent implementation of our strategy in all business units.

“Currently our focus is on addressing the significant changes in airfreight market conditions and on continuing our restructuring activities in contract logistics.

“With our initiatives to improve our technological capabilities we will become more cost effective and improve customer service. We are well set to successfully meet the challenges of an ever demanding market”.