TNT Express said today its results in Europe have been hit by falling volumes so far this yearbut strong Australia results have supported results in Asia Pacific.
In a trading update, the Dutch company, which is set to be acquired by UPS for $5.2 billion,said that since the start of 2012 it has continued to experience “mixed economic conditions inEurope and slowing Asia-Europe trading volumes”.
In 2011, TNT Express reported an operating loss of €105 million compared to the previous year’s€180 million profit. The underlying profit, excluding currency effects and one-off effects, dropped29.4% to €228 million. Revenues rose 2.7% to €7.2 billion.
In Europe & MEA so far this year, “pricing pressure and a decline in international expressvolumes have negatively impacted operating results”, TNT said. A fixed-cost optimisation programme,with the aim of reducing fixed costs by €150 million by the end of 2013, has been started. In 2011,the region made an operating profit of €356 million on revenues of €4.5 billion, which was a 7.9%profit margin.
Results in Asia-Pacific, while under pressure because of lower Asia volumes, have benefited fromthe strong performance of the Australian operations, the company stated. TNT Express’ exposure tofixed intercontinental air capacity will be reduced as of Q2, 2012, through the code-share andblock-space agreement signed with Emirates Sky Cargo, it added. Last year the region dropped intothe red with a loss of €76 million on revenues of €1.8 billion.
TNT said that the Americas’ performance to date has been in line with the prior year, withBrazil performing according to plan. The company aims to get its heavily loss-making Brazilianbusiness back to profit in the second half of this year. The region made an operating loss of €360million, including a €224 million value write-down, on revenues of €467 million last year.
Meanwhile, TNT also said that in view of the intended UPS offer for the company the plannedrestructuring of the supervisory board would not take place at the April 11 shareholders meeting.The nominations of two additional board members, Marcel Smits and Sjoerd Van Keulen, have beenwithdrawn and the board’s membership will remain unchanged for the time being.
