April 25, 2016: TNT reported revenues of €1.587 million and operating income of minus €1 million for the first quarter of 2016. Both were negatively influenced by fewer working days.
Underlying revenue growth, adjusted for currency effects, lower fuel surcharges and working-day effect, was 4.2 percent. During the first three months of 2016, TNT continued to grow revenues from SMEs (+6.5 percent) and increased revenues in most countries, including China.
Operating income was minus €1 million, a €10 million improvement over the prior year. This result included one-off charges of €10 million, of which €4 million related to the FedEx offer.
Excluding one-off charges, TNT’s adjusted operating income was €9 million, up €8 million year-on-year. TNT continued to execute its strategic Outlook initiatives, such as ‘Global Business Services’ and ‘Simplify & Transform’, and booked Outlook-related transition and project costs of €9 million during the quarter.
Capital expenditures amounted to €51 million (3.2 percent of revenues) compared to €78 million (4.8 percent of revenues) in the prior year. TNT finished the first quarter with a net cash position €145 million, compared to €330 million one year earlier.
Tex Gunning, TNT’s chief executive officer, said, “In the first quarter, TNT again delivered solid underlying revenue growth. Our customer satisfaction scores hit new records in Q1. Investments in operational excellence have started to pay off and were €51 million during the quarter.”
In the first quarter, International Europe segment reported that revenues rose by 2.4 percent to €679 million. The International AMEA segment had a strong first quarter. Currency-comparable revenue growth was 4.3 percent, while underlying revenue growth, adjusted for currency effects, lower fuel surcharges and working-day effect, was 8.3 percent. Revenue growth from SME customers was 12.1 percent. In contrast with recent quarters, China achieved revenue and volume growth.
The company expects to achieve structural improvements from 2016 onwards and to see the full benefit of the Outlook strategy from 2018-19.
TNT expects continued economic volatility in some markets outside Europe, especially in Brazil. TNT anticipates restructuring charges of about €30 million in the second quarter. Closing of the FedEx Offer to acquire TNT is anticipated in the first half of calendar year 2016.