Who’s Who in European Logistics 2011

In its latest published research, Who’s Who in European Logistics 2011, Analytiqa analyses and profiles the operational and financial performance of leading contract logistics operators to identify:

Ø  Top ten 3PL revenues climb by 8% in 2010, but are just 2% higher than in 2007
Ø  Average profit margins are down by 0.4 percentage points since 2007
Ø  3PLs are targeting industry specific solutions to add value and boost profitability
 

Across 200+ pages Analytiqa provides a unique, comprehensive analysis of the ‘health’ and rankings of the leading European contract logistics service providers

Revenues recover, but margins remain depressed

Analytiqa, London – Friday, 09 September 2011: Analytiqa’s latest research, “Who’s Who in European Logistics 2011”, reveals the struggle that logistics providers face to maintain profit margins in increasingly challenging and competitive markets.

Top Ten 3PLs report 8% rise in turnover

In 2010, a year defined by a ‘moderate recovery’, of global economies, the largest 10 3PL providers that operate in Europe had combined contract logistics revenues of €45.4 billion, which represented an increase of some 7.7% over the revenues achieved in 2009 – but were just 2.3% higher than the industry leaders recorded in 2007.

Damco, Geodis and Gist top the industry growth charts

Compiling the average industry growth rate in contract logistics revenues, analysed between 2007 and 2010, shows a significant swing in industry growth, from the highs of 2007, through the lows of 2009, to something of a recovery in 2010. Damco, Geodis and Gist reported the highest growth in turnovers in 2010.

In Tier One, the industry leaders, average contract logistics revenue growth was 8.3% in 2010, up from a decline of 11.4% in 2009. Overall revenue growth in Tier Two reached 9.2%, the highest average growth rate, in 2010, up from a 14.4% decline in 2009, a swing of some 23.6 percentage points. Tier Three companies reported average revenue growth of 7.5% in 2010.

2011: a turnaround in profitability?

As the general economic outlook remained somewhat stagnant in the first half of 2011, after early promise and enthusiasm for a considered economic upturn died away, supply chain markets became increasingly challenging, though results set against the lows of prior year periods were largely positive.

Uncertainty prevailed across many European economies in the first half of 2011, impacted by the continuing threat of economic ‘bail-outs’ on nationwide scales across the EU. This, in turn, impacted consumer buying patterns, resulting in challenging dynamics between manufacturers, retailers and their logistics service providers. These impacted both operationally and financially on 3PL performance.

On average, revenues in contract logistics increased by 8.9% in the first half of 2011, year-on-year. This is marginally below the 9.9% average contract logistics revenue growth figure achieved by companies in the full year 2010.

Revenue increases across the sector are largely attributable to an upturn in business activity amongst customers, though on a global scale, the European region lags behind growth seen on other continents and, in particular, Asia Pacific.

Average profits grew by over 19% in the first half of the year. Increased profitably of the 3PLs is down to a combination of two key factors. The first is the higher levels of activity as compared to 2010, but secondly, it is the continuing impact of proactive measures and restructuring initiatives put in place in recent months to improve levels of earnings in the contract logistics sector.

3PLs face a battle to maintain profit margins

In 2010, average profit margins in contract logistics increased marginally, largely due to the strong turnaround performance of DHL Supply Chain. Looking at longer term trends, over the 2007-2010 period, the contract logistics sector has suffered a decrease in average profit margins achieved by the leading 3PLs, not least as a result of the fierce competitive pressures amongst these operators.

Cat, Gist and CEVA lead in pursuit of profits

Whilst margins were unchanged in 2010, on average, amongst the Tier One logistics companies in Europe, Tier Two logistics companies saw a slight decline in their profitability. Tier Three companies reported growth in average profit margins in 2010.

2010 sees growth in employee productivity

2010 saw 12 of the top 15 3PLs, ranked by revenue per employee, achieve higher levels of performance across this indicator. A number of factors will impact upon this performance indicator, not least the countries and industry sectors in which the companies serve, but four companies were able to report growth rates in excess of 10%.

Mark O’Bornick, Research Director, Analytiqa commented:

“The European 3PL market remains challenging and competitive, both operationally and financially. Confident in revenue growth, the focus for 3PLs in 2011 has turned to industry specific solutions. These are being developed by logistics providers to create added value for customers, to assist 3PLs to maintain, or even grow, margins.”

Research Content:

Compiled from both primary and secondary research conducted by Analytiqa analysts on an ongoing basis, this report provides exclusive, focused and detailed insight into the dynamics of this ever evolving sector and its key participants. Whilst elements of this report provide group level revenues and profits, this is largely in order to place contract logistics activities in context. The main focus of the report is the contract logistics market, namely the distribution, warehousing and value added service elements of the supply chain, excluding road, sea and air freight activities. In addition to the detailed understanding of individual 3PL operations and performance across 25 company specific chapters, unique industry-wide analysis provides the following ranking indicators and benchmarks:

Top Ten 3PL Ranking by Contract Logistics Revenue, 2006-2010

3PL Ranking by Group Revenue, 2006-2010

3PL Ranking by Logistics Revenue, 2006-2010     

3PL Ranking by Contract Logistics Revenue, 2006-2010

3PL Ranking by Logistics Revenue Growth, 2007-2010

3PL Ranking by Contract Logistics Revenue Growth, 2007-2010

Average 3PL Contract Logistics Revenue Growth, 2007-2010

Revenue Growth in Contract Logistics by Company Size, 2009-2010

Trends in Profit Margin in European Contract Logistics, 2010

3PL Ranking by Contract Logistics Margins, 2007-2010

Changes in Contract Logistics Margin Performance, 2007-2010

3PL Ranking by Contract Logistics Revenue per Employees, 2009-2010

3PL Ranking by Logistics Revenue per Employees, 2009-2010

3PL Ranking by Contract Logistics Employees, 2009-2010

3PL Ranking by Logistics Employees, 2009-2010

3PL Ranking by Warehouse Space (m2), 2009-2010

3PL Ranking by Warehouse Space (Locations), 2009-2010

Companies analysed include: Agility Logistics; Caterpillar Logistics; CEVA Logistics; Dachser ; Damco; DHL Supply Chain; DSV; FCC; Fiege; FM Logistic; GEFCO; Geodis; Gist; Kuehne + Nagel; Logwin; Norbert Dentressangle; Panalpina; Rhenus Logistics; DB Schenker; SDV; Stef-TFE; Unipart; UPS SCS; Wincanton; Yusen Logistics.

Quelle: Analyitqa