Panalpina has reported stable results for the first half of 2019 although figures for the air freight segment were mixed in a challenging operating environment, despite a five per cent jump in volumes to 511,700 (2018: 489,400 tonnes).
The freight forwarder, recently bought by DSV, said from to June 2019, compared to the same period last year, gross profit per ton decreased nine per cent to CHF 659 (US$668) (2018: CHF 725), while overall gross profit decreased to CHF 337.2 million (2018: CHF 354.6 million).
Substantially lower volumes in the automotive sector led to the decline in gross profit. EBIT in air freight decreased from CHF 53.4 million to CHF 38.4 million. The EBIT-to-gross-profit margin came in at 11.4 per cent, compared to 15.1 per cent the year before.
Overall, Panalpina generated an EBIT of CHF 52.1 million (2018: CHF 54.7 million) and a consolidated profit of CHF 34 million (2018: CHF 36.1 million), thereby nearly reaching previous-year levels. Net forwarding revenue was CHF 2.96 billion (2018: CHF 2.91 billion).
“After it was announced that Panalpina and DSV would join forces, our competitors went more aggressively after our business in the second quarter, but we stood our ground,” said Panalpina chief executive officer, Stefan Karlen.
“The decrease in gross profit was chiefly the result of lower margins in air freight and lower volumes from the automotive sector, which shifted into reverse gear. Nonetheless, group EBIT and profit almost reached last year’s levels. Given these circumstances, our stable half-year results are a respectable achievement.”
As for the future, Karlen said: “In a highly uncertain macroenomic and political environment, and against the backdrop of contracting air and ocean freight markets, we will continue to provide our sought-after expertise to existing and new customers.
“During the coming weeks and months, our focus will remain firmly on living up to our reputation in the market and delivering outstanding service quality.”