Kuehne + Nagel Group – Nine-months 2010 results

Successful implementation of growth strategy – Record result in the third quarter 2010

Schindellegi, Switzerland, October 18, 2010 – Through the consistent implementation of its growth strategy, the worldwide operating Kuehne + Nagel Group managed to continuously expand its business volumes, taking advantage of the favourable economic environment for the logistics industry. The operational result (EBITDA) of CHF 271 million in the third quarter marked a record in the company’s history. Compared with the first nine months of last year turnover rose by 18.6 per cent (currency-adjusted by 22.6 per cent) to CHF 15,178 million. EBITDA increased by 7.5 per cent (adjusted by 12.0 per cent) to CHF 746 million. Net earnings improved by 16.0 per cent (adjusted by 20.2 per cent) to CHF 449 million.

Kuehne + Nagel Group Jan-Sep 2010 Jan-Sep 2009
CHF million
Turnover 15,178 12,800
Gross profit 4,453 4,388
Operational result (EBITDA) 746 694
EBT 572 499
Net earnings 449 387

During the first nine months of 2010, Kuehne + Nagel maintained high-level container volume with a 17 per cent increase. Growth in the global seafreight market, however, softened in the third quarter. Kuehne + Nagel’s increased sales and marketing activities contributed significantly to further market share gains. In the first nine months, the EBITDA-to-gross profit margin grew from 32.5 per cent in the previous year to 35.8 per cent in 2010, mainly due to additional productivity increases.

Kuehne + Nagel increased airfreight tonnage by 29 per cent in the first nine months, although growth in the international airfreight market had slowed in the middle of the year. Kuehne + Nagel was able to considerably increase volumes and market share, especially in the trade lanes from and to Asia. At the same time, the company benefited from its service offerings tailored to specific industries, such as pharmaceuticals, high-tech and perishables. Increased productivity and efficient cost management contributed to an improved EBITDA-to-gross profit margin by 30.5 per cent (previous year: 29.3 per cent).

Road & Rail Logistics
In the first three quarters of the year, Kuehne + Nagel’s European overland activities registered a growth in net turnover of 9.5 per cent. Despite high investments into the expansion of the European network and the opening of new locations, the operational result and EBITDA margin to turnover remained stable.

Contract Logistics
The recovering domestic economies of the leading industrial nations led to a stabilisation of the contract logistics market; Kuehne + Nagel’s net turnover remained at the previous year’s level. EBITDA decreased in the first nine months by 13.2 per cent partly due to currency adjustments (6.6 per cent) and start-up costs for new businesses as well as restructuring activities in the United States and Canada. Contract logistics activities in the emerging economies of Asia and Eastern Europe improved. Investments in Asia have started to pay off and led to positive results for the first time.

Reinhard Lange, CEO of Kuehne + Nagel International AG, said: “Due to the very good results of the past nine months – and particularly in the third quarter of 2010 – we are confident we will achieve a strongly improved result for the full-year. We will concentrate our efforts on the consistent implementation of our growth strategy, thus further strengthening Kuehne + Nagel’s position in the global logistics market.”

About Kuehne + Nagel

With more than 55,000 employees at 900 locations in over 100 countries, the Kuehne + Nagel Group is one of the world’s leading logistics companies. Its strong market position lies in the seafreight, airfreight, contract logistics and overland businesses, with a clear focus on providing IT-based supply chain management services.

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