Kuehne Nagel records robust Q1 spurred by pharma, ecommerce shipments
Kuehne Nagel's start to the 2021 business year was marked by a strong demand in transport services, especially for pharma and ecommerce fulfilment. Kuehne Nagel achieved an excellent result in this environment: net turnover of over CHF 6 billion, EBIT of CHF 431 million and earnings for the period of CHF 318 million were all significantly higher year-on-year.
Dr. Detlef Trefzger, CEO of Kuehne Nagel International AG, says, "Exactly one year ago, when we were still at the beginning of the pandemic, we decided to commit to our proven strategy. Upon reflection, we are assured that we chose the correct path: in the first quarter of 2021, we were well-prepared to serve our customers' robust demand for high quality logistics services despite the tense market environment. We expect this environment to remain challenging for the remainder of another atypical year."
Air logistics saw a return to trade volume growth in the first quarter of 2021, the first time in more than two years. This was contrasted by limited global freight capacities. Kuehne Nagel's expertise in dealing with this bottleneck was particularly crucial for the transport of pharma and essential goods.
Airfreight volumes developed positively, reaching 433,000 tonnes in the first quarter of 2021 (16 percent year-on-year). Combined with strong yields, net turnover improved to CHF 1.7 billion and EBIT to CHF 163 million. The conversion rate was 40.5 percent.
Further progress was made in the digitalisation and automation of air logistics processes (eTouch). This development was particularly advanced in the booking processes, invoicing and documentation.
In road logistics, the first quarter of 2021 was characterised by a significant increase in consignment numbers and a return of European national transport capacities to prior year levels. After a weak start, UK transport demand recorded a noticeable recovery throughout the remainder of the quarter.
The unit's net turnover of CHF 870 million in the first quarter of 2021 was at the previous year's level; however, EBIT of CHF 24 million improved by 41.2 percent year-on-year. Originally designed for Asia, the online booking platform for road logistics, eTrucknow, was successfully launched in Australia and Russia in the first quarter of 2021.
In the first quarter of 2021, contract logistics returned to organic growth of 4 percent, in line with the market. As a result of the divestment of part of the UK business as of January 1, 2021, turnover declined in the first quarter of 2021.
The unit's net turnover of over CHF 1.1 billion was 9.3 percent below the previous year; EBIT, however, increased by 123.5 percent to CHF 38 million.
The pharma business and e-commerce fulfilment activities again had a positive impact. In March, the business unit entered into a strategic partnership with Jointown, the largest non-state pharmaceutical distributor in China.