Panalpina records stable Q3 and 9 month results

Panalpina has announced its results for the third quarter and first nine months of 2014. It reported net forwarding revenue of CHF1.73bn, an increase of 1.5% year-on-year. The company also reported EBITDA of CHF48.8m, a rise of 1.1% on the prior comparable period of 2013. Accordingly the company’s EBITDA margin stood at 2.83%.

Panalpina also stated that it maintained overall profitability over the first nine months of 2014. The stable result came in spite of ongoing restructuring and a year-on-year decline in net forwarding revenue of 1.44% to CHF4.96bn. The company’s gross profit and EBIT both increased by 1% on the first nine months of 2013, reaching CHF1.18bn and CHF94.4m respectively, adjusted for currency fluctuations these increases were 6% and 4% respectively. These results came as the volumes of the Air Freight and Ocean Freight segments grew 4% and 8% respectively over the first three quarters of 2014, but unit profitability decreased due to margin pressure and currency effects.

“We have managed to keep up profitability in the first nine months of the year,” said Panalpina’s Chief Executive Officer Peter Ulber. “I am particularly pleased with our progress in Logistics, where we have significantly reduced losses and are close to reaching break-even. We also showed continued good volume growth in Air Freight and very strong volume growth in Ocean Freight.”

In Air Freight Panalpina’s volumes grew by 4% in the first nine months of 2014, slightly ahead of the market. Gross profit per ton decreased 5% compared to the first nine months of 2013, to CHF745. As a result, gross profit remained practically unchanged at CHF469.0m. Air Freight achieved an EBIT of CHF85.3m, 8% less than in the same period of last year. The EBIT-to-gross-profit margin for the first nine months of 2014 decreased to 18.2%.

In Ocean Freight Panalpina’s volumes grew a by 8% in the first nine months of 2014. This was in part the result of some new business wins in managed solutions. However rates remanied volatile and declined over the period resulting in decrease in gross profit per TEU of 8% to CHF309. These factors led to a stable gross profit of CHF370.4m. Ocean Freight posted an EBIT of CHF16.0m. The EBIT-to-gross profit margin decreased to 4.3% in the first nine months of 2014 but was up quarter-on-quarter.

Logistics increased gross profit 5% to CHF339.3m and cut its EBIT loss to CHF6.9m in the same period this year. “With our Logistics business likely to reach break-even far earlier than anticipated, our main focus has now clearly shifted to improving our performance in Ocean Freight,” said Ulber. “We already produce high volumes, but we have to reengineer processes and roll out the next generation IT platform.”


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