New survey: TNT Logistics stays as Europe’s number one

Transport Intelligence has released its annual rankings of the largest contract logistics companies in Europe, contained in its report European Logistics Leaders 2004. Overall the top three contract logistics companies remained the same in 2003 as the previous year when TNT Logistics took over as the largest logistics company in Europe from Exel. Both companies grew strongly in 2003, mostly organically. Wincanton’s acquisition of P&O Trans European created a third company of comparable scale to the top two.

Elsewhere in the top ten, notable movers included Thiel Logistik which leapfrogged DHL Solutions to become Europe’s number four. However recent disposals could see the company slip down next year’s rankings. Tibbett & Britten also moved up the table and became the sixth largest provider in Europe.

Commenting on the findings the report’s author, John Manners-Bell said: ‘For many companies, this year has been one of consolidation. There have been fewer major acquisitions, with most of the largest European providers preferring to focus on organic growth whilst integrating the companies which they have acquired over the past few years. The top three companies have now put clear water between themselves and the rest of the chasing pack in terms of revenues and with players such as Christian Salvesen, Hays and Thiel all making disposals the number of companies which can challenge their dominance is falling.’

The survey also identified that profit margins continued to fall in 2003 from already low levels. In 2002 the average operating margin amongst the companies surveyed was 2.98%. However as the operating environment in Europe became more challenging margins fell to just 2.22%.

Manners-Bell added: ‘Although most contract logistics companies are at least not making losses, it is clear that profitability in the industry must be addressed. It would seem that although the market is growing quickly in terms of revenue, clients are getting ever more sophisticated at driving down rates. It is evident that logistics operators are finding it difficult to achieve levels of efficiency and cost savings which can counter this downward pressure.’