Panalpina profit drops, layoffs planned
Panalpina, the Switzerland-based forwarder and logistics company, reported net profit of 113.8 million Swiss francs ($98.3 million) in 2008, a 46 percent drop from the same 2007 period.
Gross revenue was 10.6 billion Swiss francs ($9.2 billion), up 0.5 percent from last year.
The company said a cost-cutting program implemented in February 2008 is being continued into 2009 and that it would cut about 10 percent of its workforce in 2009 or 1,400 to 1,600 jobs. The company has about 15,400 employees globally, including 2,400 in North America.
The company said net forwarding revenue for 2008 was up 2.7 percent or 10.1 percent if adjusted for currency, and said both its air freight and ocean freight sectors grew quicker than the market overall.
The company said its results were significantly negatively influenced by currency fluctuations and the withdrawal from the domestic business in Nigeria.
It said operating earnings were reduced by 100 million francs ($86 million) “due to the withdrawal from Nigeria as well as costs associated with ongoing investigations, including 45 million francs ($39 million) for legal and consulting fees.”
Last year Panalpina said it incurred 5,6 million francs ($4.8 million) in legal and consulting fees related to a U.S. Justice Department investigation related to compliance with the U.S. Foreign Corrupt Practices Act.
“Taking into account all challenges with which we were confronted in 2008, I am satisfied with these results. We were able to gain market share in the air freight and ocean freight sectors and won new contracts in all segments. These results underscore the success of Panalpina’s asset-light business model, which enables us to react quickly to the market and to the individual requirements of our customers”, said Monika Ribar, chief executive officer. “Especially in the current economic conditions it makes even more sense to provide services for the most part without capital-intensive infrastructure of our own, but based on state-of-the art IT systems and through the professional management of first-class sub-contractors.”