The logistics provider and freight forwarder doubled EBIT and increased gross profits by more than 600% in 2014.
The Panalpina Group more than doubled its earnings before interest and taxes to 116.7 million Swiss francs (U.S. $120.44 million) in 2014 compared to CHF 48.0 million in 2013, according to the company’s latest financial statements. As a result, the international logistics provider and freight forwarder increased gross profits 639 percent from CHF 11.7 million to CHF 86.5 million.
The group attributed its success in 2014 to growth in ocean and airfreight volumes, as well as “significant progress” in its logistics unit.
Panalpina’s net forwarding revenue dropped slightly, from CHF 6.76 billion in 2013 to CHF 6.71 billion in 2014, but gross profit increased 2 percent to CHF 1.59 billion
Panalpina transported 857,800 tons of air cargo last year, up 4 percent from 825,100 tons in 2013 and slightly ahead of the 3.5 percent growth experienced in the overall market. Gross profit on airfreight rose slightly, from CHF 631.4 million to CHF 636.3 million, despite a 3 percent decrease in gross profit per ton to CHF 742.
Ocean freight volumes grew 7 percent year-over-year, as Panalpina transported 1,606,500 TEUs in 2014 compared to 1,495,400 TEUs in 2013. The group estimated the overall market grew by 4 to 5 percent. Gross profit for the division was relatively stable, falling from CHF 491.9 million to CHF 491.5 million as gross profit per TEU decreased 7 percent to CHF 306.
Gross profits for the group’s logistics offerings increased 5 percent to CHF 458.2 million in 2014.
“In 2014, we executed on our clearly laid out strategy. This shows in the results we achieved,” Panalpina CEO Peter Ulber said of the results. “Streamlining in Ocean Freight continues, which is a crucial prerequisite for the large-scale and complex transition to our new business platform SAP TM in 2015. We are satisfied with the achieved growth in Air Freight and particularly pleased with the turnaround in Logistics. All in all, it was a successful year. With plenty yet to do, all eyes are now on 2015.”
Looking forward to 2015, Panalpina said its goal is to outperform the air and ocean freight markets again, which it estimates will grow by 3 to 4 percent and 4 to 5 percent, respectively.
“We remain very focused on executing our strategy in 2015,” said Ulber. “Given the record low oil price, we expect some headwinds in oil and gas exploration and production activities, but this could also create opportunities in re-engineering supply chains end-to-end and outsourcing.
“Currency translation will impact our financial results because of the strong Swiss franc,” he added. The value of the Swiss franc soared in January when the Swiss National Bank removed a cap on the currency that previously pegged it to the euro.
“Altogether, 2015 is a very important year for Panalpina as we go into the main implementation phase of the SAP TM project and continue to lay the foundation for future sustainable growth,” said Ulber.
Profits soar at Panalpina
