Encouraging start to 2018 for Panalpina as profits improve

April 19, 2018: In the first three months of 2018, international freight forwarding and logistics company Panalpina improved profitability compared to the same period of last year. Panalpina reported an EBIT of CHF 24.4 million (YTD 2017: CHF 16.4 million) and a consolidated profit of CHF 16.6 million (YTD 2017: CHF 12.4 million).

“We’ve had an encouraging start into 2018. Profitability per transported unit increased in both Air and Ocean Freight,” says Panalpina CEO Stefan Karlen. “In ocean freight, we still recorded a loss, but it has come down from the last quarter of 2017. Logistics contributed to the good overall performance with a solid EBIT result.”

Higher EBIT and consolidated profit In the first quarter of 2018, Panalpina’s gross profit increased 11 percent to CHF 370.7 million (YTD 2017: CHF 332.7 million), while total operating expenses stayed flat at CHF 306.3 million (YTD 2017: CHF 305.7 million). EBIT and consolidated profit increased year-on-year by 49 percent and 34 percent respectively. EBIT reached CHF 24.4 million compared to CHF 16.4 million a year before and the EBIT-to-gross-profit margin stood at 6.6 percent, up from 4.9 percent in 2017. The consolidated profit increased from CHF 12.4 million to CHF 16.6 million.

Air freight
Panalpina’s air freight volumes increased 3 percent in the first quarter of 2018. Compared to the same period of last year, gross profit per ton increased 19 percent to CHF 739 (YTD 2017: 620), while overall gross profit increased to CHF 177.8 million (YTD 2017: CHF 144.7 million). EBIT in air freight increased from CHF 17.1 million to CHF 26.9 million. The EBIT-to-gross-profit margin came in at 15.1 percent compared to 11.8 percent a year before.

Ocean freight
Panalpina’s ocean freight volumes decreased 4 percent year-on-year, mainly as the result of a discontinued high-volume contract, while gross profit per TEU increased 7 percent to CHF 303 (YTD 2017: CHF 282), bringing gross profit to CHF 108.9 million (YTD 2017: CHF 105.5 million). For the first quarter of 2018, ocean freight recorded an EBIT loss of CHF 5.8 million, compared to a loss of CHF 3.2 million a year before.

Logistics
In logistics, gross profit increased 2 percent to CHF 84.0 million year-on-year (YTD 2017: CHF 82.5 million). EBIT reached CHF 3.4 million for the first three months of 2018, compared to CHF 2.4 million for the same period of last year.

Outlook
“Global air freight demand continues to be healthy and the carriers have begun to increase rates substantially. We will have to be very disciplined in passing these rate increases on as we head for a summer season that could be busier than usual again,” says Karlen.

“In ocean freight, our immediate focus is clearly on improving profitability. In logistics, we have made important investments that put us in a good position for top-line growth during the rest of the year,” he added.