News from Kuehne + Nagel

Kuehne + Nagel expands in Brazil with the acquisition of Grupo Eichernberg, and reports positive global results in a challenging market environment.

Kuehne + Nagel has entered into an agreement to take over the shares of Grupo Eichenberg – a strategic acquisition that will enable Kuehne + Nagel to provide integrated door-to-door logistics solutions and to speed up expansion in Brazil.

Based in Porto Alegre, Grupo Eichenberg provides integrated logistics solutions at fourteen locations.
Grupo Eichenberg provides road logistics services both in the domestic market and in Mercosur trades, operating daily services to and from Argentina, Chile and Uruguay. The company also provides domestic airfreight forwarding services.
According to Kuehne + Nagel chairman Karl Gernandt, this acquisition is in line with the company’s global growth strategy, and ideally fits its objective to significantly expand its activities in Brazil, which is one of the world’s key growth markets.

In other news, Kuehne + Nagel Group achieved growth above the market average in all business units in the first half of 2011.

Despite considerable negative currency effects, net earnings were up 11% to CHF 312 million. EBITDA increased by 5.7% to CHF 502 million, while turnover at CHF 9,786 million was slightly below the previous year’s level due to negative currency effects.

Seafreight volumes were up 12% in the first half of the year, with the highest growth being achieved in exports from Europe to North America and Asia as well as from Asia to Latin America and the Middle East. EBITDA was up 7.8%, despite considerable investments in growth initiatives.

Airfreight tonnage increased by 18% despite sharply declining volumes in the global airfreight market during the second quarter, resulting in a market growth of just about 2% in the first half of 2011. The company’s expansion of activities in the perishable logistics sector following the acquisitions in South America as well as increased demand in the trade lanes from Europe to North America and Asia contributed to the strong performance. While volumes increased in trades from North America to Europe and to South America, airfreight business from Asia to Europe did not meet expectations. Overall, EBITDA up 22.9% for the first half of 2011.

Road & Rail Logistics: The extension of activities in the groupage, full load and part load businesses resulted in a 21.4% increase in turnover. RH Freight contributed about 10% to the increase of shipments. While the results in Western Europe clearly improved, the business unit’s 6.9% drop in EBITDA was due to investments in the organic development of overland services in countries such as Poland and China.

Contract logistics turnover was up 5.4%. New businesses and the consolidation of warehousing activities at major logistics centres supported the enhancement of capacity utilisation to 94%, and productivity improvements helped the EBITDA margin to remain on the previous year’s level, with EBITDA increasing by 6.5%.