TNT Express restructuring sees profits slump
Dutch courier TNT Express on Monday reported a 22-million-euro slump in net profit in the second quarter, blamed on restructuring and impairments after demerging from parent company TNT N.V.
The company raked in four million euros ($5.7 million) compared to 26 million euros in the second quarter of 2010.
Profits were hit by 29 million euros in restructuring costs, impairments and one-offs in Brazil, TNT Express said in a statement. Rising fuel prices also had a negative effect, it added.
TNT Express on June 1 demerged from its former parent TNT N.V., to form a separate courier company. TNT N.V.'s postal arm is now called PostNL.
The company said its turnover however rose by 0.9 percent to 1.8 billion euros despite "volatile demands", as sales increased in the Asia-Pacific region by 5.2 percent to 442 million euros.
In Europe, the Middle East and Africa, which supported more than half of TNT Express' sales, revenue was up 1.2 percent.
TNT Express said however its biggest drop in sales, 13.4 percent, was in the Americas, especially Brazil where the "full impact of major customer losses (were) evident in significant year-on-year volume deterioration and related operating losses."
In Europe, the Middle East and Africa, revenue was expected to grow "modestly", TNT Express said, while its Asia-Pacific business was to partially recover and the America's continuing negative performance would be addressed "through a range of corrective measures."
TNT N.V. in January internally separated its courier and postal arms into two companies. Shareholders approved the move on May 25.
Mainly active in the Netherlands and renamed PostNL, the postal arm saw volumes drop due to a liberalisation in the Dutch postal market and competition from the Internet.
TNT Express operates in over 200 countries and employs some 83,000 people.
© 2011 AFP