News Content
Troubled TNT posts quarterly US$69.7 million loss as revenue declines 2pc
TROUBLED Dutch parcel delivery giant TNT has posted a third quarter net loss of EUR55 million (US$69.7 million), against last year's quarterly operating profit of EUR6 million. This year's quarterly revenue was EUR1.65 billion, down two per cent.
Nearly two years after a long-planned takeover by rival United Parcel Service (UPS) dissolved over EU antitrust suspicions, TNT last month abandoned its 2015 goals.
"We are losing market share," said chief financial officer Maarten de Vries, adding the company is "facing a competitive challenge."
UPS recently reported a 5.5 per cent rise in third-quarter revenue from its express business outside the US, citing growth from all regions of the world and 14 per cent higher export volumes out of Europe.
During the third quarter, TNT's business in Western Europe, which generates about 50 per cent of its revenue, posted a 1.5 per cent decline in sales and an operating profit increase of 4.2 per cent.
Overall, TNT's operating profit was up 3.1 per cent in the third quarter, compared with 14.5 per cent for UPS' international package operations.
In recent years TNT has struggled to compete with its much larger rivals, Deutsche Post's DHL unit, UPS and FedEx Corp, which combine air and road networks to deliver a wide range of delivery services around the world, noted MarketWatch.
At the same time, a shift to slower, less-costly business-to-business deliveries and rapid growth of e-commerce has benefited European players such as GeoPost Group's DPD unit and Britain's Royal Mail. GeoPost is a subsidiary of French-state owned Le Groupe La Poste.
After UPS abandoned its nearly $7 billion bid for TNT, the Dutch company said it would cut costs, sell some assets and focus on Europe to improve profitability. It appointed former Akzo Nobel NV executive Tex Gunning, a member of TNT's supervisory board at the time, to lead the turnaround.
Said Mr Gunning: "In our recent trading statement, we highlighted the challenging trading conditions in Europe. Despite this, this quarter saw another improvement in our adjusted operating income, with every segment making a positive contribution apart from Europe Other & Americas where performance was broadly flat."
Six months into the job, Mr. Gunning replaced the senior management team and narrowed the company's strategic focus. Growth from small and medium sized enterprises and improved productivity and efficiency of its European road network should boost sales and margins.
On Monday, TNT said it would invest EUR185 million in its European road network over the next few years to regain competitiveness. It will invest in automation of 12 of the 19 road depots in Europe and invest in new IT systems for road planning and customer service.
Nearly two years after a long-planned takeover by rival United Parcel Service (UPS) dissolved over EU antitrust suspicions, TNT last month abandoned its 2015 goals.
"We are losing market share," said chief financial officer Maarten de Vries, adding the company is "facing a competitive challenge."
UPS recently reported a 5.5 per cent rise in third-quarter revenue from its express business outside the US, citing growth from all regions of the world and 14 per cent higher export volumes out of Europe.
During the third quarter, TNT's business in Western Europe, which generates about 50 per cent of its revenue, posted a 1.5 per cent decline in sales and an operating profit increase of 4.2 per cent.
Overall, TNT's operating profit was up 3.1 per cent in the third quarter, compared with 14.5 per cent for UPS' international package operations.
In recent years TNT has struggled to compete with its much larger rivals, Deutsche Post's DHL unit, UPS and FedEx Corp, which combine air and road networks to deliver a wide range of delivery services around the world, noted MarketWatch.
At the same time, a shift to slower, less-costly business-to-business deliveries and rapid growth of e-commerce has benefited European players such as GeoPost Group's DPD unit and Britain's Royal Mail. GeoPost is a subsidiary of French-state owned Le Groupe La Poste.
After UPS abandoned its nearly $7 billion bid for TNT, the Dutch company said it would cut costs, sell some assets and focus on Europe to improve profitability. It appointed former Akzo Nobel NV executive Tex Gunning, a member of TNT's supervisory board at the time, to lead the turnaround.
Said Mr Gunning: "In our recent trading statement, we highlighted the challenging trading conditions in Europe. Despite this, this quarter saw another improvement in our adjusted operating income, with every segment making a positive contribution apart from Europe Other & Americas where performance was broadly flat."
Six months into the job, Mr. Gunning replaced the senior management team and narrowed the company's strategic focus. Growth from small and medium sized enterprises and improved productivity and efficiency of its European road network should boost sales and margins.
On Monday, TNT said it would invest EUR185 million in its European road network over the next few years to regain competitiveness. It will invest in automation of 12 of the 19 road depots in Europe and invest in new IT systems for road planning and customer service.
Latest News
- For the first time, tianjin Port realized the whole process of dock operati...
- From January to August, piracy incidents in Asia increased by 38%!The situa...
- Quasi-conference TSA closes as role redundant in mega merger world
- Singapore says TPP, born again as CPTPP, is now headed for adoption
- Antwerp posts 5th record year with boxes up 4.3pc to 10 million TEU
- Savannah lifts record 4 million TEU in '17 as it deepens port
