Panalpina Group achieves turnaround in Logistics

Panalpina group saw a strong performance in ocean freight in the year 2014; its air freight business grew ahead of the market

International freight forwarding and logistics company Panalpina, with headquarters in Basels, Switzerland finished the year 2014 on expectations. „EBIT more than doubled to CHF 116.7 million in 2014 compared to the previous year. Consolidated profit jumped from CHF 11.7 million in 2013 to CHF 86.5 million“, the enterprise informed this morning.

Air Freight volumes grew 4% in 2014, slightly ahead of the market (3.5%). Panalpina transported 857,800 tons of air cargo last year. Gross profit per ton decreased 3% to CHF 742, however, Air Freight gross profit stayed stable at CHF 636.3 million. The EBIT-to-gross profit margin in 2014 was at 17.6%, compared to 11.5% in the previous year (adjusted 2013: 18.9%).

Panalpina’s Ocean Freight volumes grew 7% year-on-year, while the market grew an estimated 4% to 5%. The company transported 1,606,500 TEU in 2014. Due to continued business wins in high-volume but lower-margin business, gross profit per TEU of Ocean Freight decreased 7% to CHF 306, which resulted in a stable gross profit of CHF 491.5 million. The EBIT-to-gross profit margin decreased to 2.6%, down from 5.1% in 2013 (adjusted 2013: 5.7%).

Gross profit of the group’s Logistics product continued to grow by 5% to CHF 458.2 million in 2014 (2013: CHF 437.7 million). Panalpina further expanded its Logistics Manufacturing Services (LMS) and other Value-Added Services (VAS), particularly for the technology and fashion industries. By parting with a number of loss-making facilities and unprofitable road activities, Logistics drastically reduced its EBIT loss well ahead of schedule to CHF 8.2 million in 2014, down from a loss of CHF 49.9 million in the previous year (adjusted 2013: loss of CHF 39.3 million).

“In 2014, we executed on our clearly laid out strategy. This shows in the results we achieved,” says Panalpina CEO Peter Ulber. “Streamlining in Ocean Freight continues, which is a crucial prerequisite for the large-scale and complex transition to our new business platform SAP TM in 2015. We are satisfied with the achieved growth in Air Freight and particularly pleased with the turnaround in Logistics. All in all, it was a successful year. With plenty yet to do, all eyes are now on 2015.”

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