Global supply chain company Panalpina reported an encouraging start into 2018 as profitability per transported unit increased in both air and ocean freight in the first quarter, leading to overall higher earnings, but saw ocean freight mark a bigger loss year-on-year.
In the first three months of 2018, Panalpina reported an EBIT of CHF24.4 million (US$25 million), up 49% from CHF16.4 million in the same period last year, while consolidated profit was CHF16.6 million, 34% higher than the CHF12.4 million logged in the same period in 2017.
Gross profit increased 11% to CHF370.7 million from CHF332.7 million, while total operating expenses stayed flat at CHF306.3 million.
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.”
Air freight volumes increased 3% in the first quarter of 2018. Compared to the same period of last year, gross profit per ton increased 19% to CHF739 from CHF620, while overall gross profit increased to CHF177.8 million (YTD 2017: CHF144.7 million). EBIT in air freight increased from CHF17.1 million to CHF26.9 million.
Ocean freight volumes decreased 4% year-on-year, mainly as the result of a discontinued high-volume contract, while gross profit per TEU increased 7% to CHF303 (YTD 2017: CHF282), bringing gross profit to CHF108.9 million (YTD 2017: CHF105.5 million). For the first quarter of 2018, ocean freight recorded an EBIT loss of CHF5.8 million compared to a loss of CHF3.2 million a year before.
In logistics, gross profit increased 2% to CHF84.0 million from CHF82.5 million year-on-year. EBIT reached CHF3.4 million for the first three months of 2018, compared to CHF2.4 million for the same period of last year.
“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,” said 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.”
