Kuehne & Nagel raises first-quarter net income 33%
Kuehne & Nagel, the Swiss forwarding and contract logistics provider, increased its net income 33 percent in the first quarter to CFR48 million ($37 million), thanks largely to a recovery in its air freight forwarding and contract logistics results.
The group’s gross revenues rose 18 percent in the latest quarter to CFR2.6 billion ($2 billion) from CFR 2.2 billion in the first quarter of last year. Group gross profit was up 18 percent at CFR553 million ($422 million), and group operating income jumped 38 percent to CFR83 million ($63 million).
Kuehne & Nagel’s main division, sea freight forwarding, raised its operating profit 10 percent to CFR33 million ($25 million) from CFR30 million. The division’s revenue was up 14 percent to CFR1.4 billion ($1 billion) from CFR1.2 billion. Its volume rose 22 percent, as compared to average market growth of 9 percent, Kuehne & Nagel said.
The company’s air freight forwarding arm increased its operating income about 50 percent to CFR27 million ($21 million), as revenue rose 11 percent to CFR546 million ($417 million). The company said this was the result of “effective cost management and gains in efficiency.”
Kuehne & Nagel’s contract logistics activities, which include the business previously known as USCO, more than doubled its operating income, from CFR5 million in the first quarter of 2003 to CFR11 million ($8 million) in the latest quarter. Contract logistics revenue rose 8 percent over the same period, to CFR295 million ($225 million).
“The restructuring measures taken last year in contract logistics — the standardization of operational processes and IT applications — have doubled earnings and significantly raised earnings before interest, tax and amortization margins from 1.7 to 3.6 percent,” Kuehne & Nagel said. It added that it took advantage of the improving economic situation in North America and the upswing in the high-tech sector in Europe.