Panalpina profits soar 37.2% in first half 2017

The international freight forwarding and logistics company recorded a consolidated net profit of 29.9 million Swiss francs (U.S. $31.4 million) for the first six months of 2017, up 37.2 percent from the corresponding 2016 period.    International freight forwarding and logistics company Panalpina recorded a consolidated net profit of 29.9 million Swiss francs (U.S. $31.4 million) for the first six months of 2017, a 37.2 percent jump from the same period in 2016, according to the company’s most recent financial statements.
   Panalpina’s net forwarding revenues reached CHF 2.63 billion for the first six months of 2017, ticking up 1.4 percent year-over-year.
   Gross profit for the first six months of 2017 totaled CHF 673.1 million, down 9 percent year-over-year due to continued margin pressure. However, the company’s costs were significantly reduced as total operating expenses fell 6 percent from the first half of 2016 to CHF 609.8 million.
   Airfreight volumes were up 7 percent year-over-year for the first six months of 2017, in line with an estimated market growth of about 8 percent. “High demand for airfreight capacity pushed up rates, which put margins under continued pressure,” the company said.
   Earnings before interest and taxes (EBIT) in the airfreight division totaled CHF 39.1 million for the first six months of 2017, up 18.1 percent from the corresponding 2016 period.
   Ocean freight volumes grew 5 percent year-over-year for the first six months of 2017, above an estimated market growth of about 4 percent, the company said. Panalpina’s ocean freight division in the first half recorded an EBIT loss of CHF 2.6 million, compared to a profit of CHF 1.3 million for the first six months of 2016.
   Meanwhile, the logistics division posted an EBIT of CHF 5.4 million, compared to CHF 0.3 million for the first six months of 2016.
   In the second quarter alone, Panalpina recorded a net profit of CHF 4.5 million and net forwarding revenues of CHF 1.35 billion, up 291 percent and 4.7 percent year-over-year, respectively.
   Looking ahead, Panalpina CEO Stefan Karlen said, “We expect ocean carriers and airlines to be much more disciplined than in previous years in managing transport capacity and sustaining freight rates. While we are confident that we can improve unit profitability in ocean freight in the second half of the year, unit profitability in airfreight will remain under pressure.
   “We will therefore concentrate on what we can influence directly: controlling cost very effectively and pushing ahead with our operations transformation program,” he added.