TNT has announced its financial results for the second quarter of 2015. It reported second-quarter revenues of €1.76bn, up 6.2% year-on-year, and an operating income of €19m, compared with €3m in the second quarter of 2014. Accordingly TNT’s Q2 operating margin stood at 1.08%.
Adjusted for positive currency effects, which increased revenues by 4.1%, the negative impact of lower fuel surcharges, which lowered revenues by 1.3% and disposals -0.6%, TNT’s underlying revenue growth for the period was 4.1%, driven by the continued growth of revenues from SMEs.
Operating income for the second quarter of 2015 includes €22m of restructuring and other charges. Adjusted operating income was €41m in the second quarter, €29m below last year. The company’s profitability was affected by IT transition and Outlook project costs of €15m, costs to introduce new services and facilities, as well as pricing pressures.
Capital expenditures rose to €96m in the second quarter, compared with €37m in the same period of 2014. During the second quarter, TNT continued to invest in sorting machinery, vehicles and IT. As well as investing in Liege, Belgium, the company is completing new sorting facilities in Madrid, Spain; Eindhoven, the Netherlands; Swindon, UK; and Brisbane & Melbourne in Australia; all of which will enter operations during the second half of 2015.
Tex Gunning, TNT’s Chief Executive Officer said, “TNT’s turnaround is progressing well under our Outlook strategy. Service levels and customer satisfaction scores further improved. We are achieving good growth in the SME customer segment after years of decline. Operational excellence investments in infrastructure and Global Business Services are being implemented according to plan and we continue to attract top industry talent. We have guided that we expect 2015 to be a transition year in terms of bottom-line performance, as we continue to invest in the transformation of TNT. As for the macro economic backdrop, we have experienced some positive developments in Western Europe, but we remain cautious given the economic volatility in China, Brazil, Australia and Greece. During the quarter, FedEx announced its intention to acquire TNT. The management team believes this is a very positive development for all our stakeholders.”
