TNT Logistics ‘turns the corner’
TPG has become the latest company to release its results for the first quarter of 2004. Revenues overall grew by 2.3% to €2,985m compared with the same quarter in 2003. However over the same period operating profits increased by 6.2% to €310m.
TPG’s mail division recorded another fall in revenues as volumes for addressed post in both the domestic and cross-border markets decreased for the 6th quarter in succession. Overall revenues dropped by 1.9% to €980m. However TPG’s European Mail Networks proved an exception and expansion of UK, German and Italian operations saw the unit rise by 18.3%. Cost cutting initiatives and increased flexibility in working practices brought about an 8.3% increase in profits in the division as a whole to €236m. This corresponds to an operating margin of 24.1%.
Express
The Express division experienced strong growth in its international volumes although domestic express remained flat. Overall revenues grew by 5.5% on 2003, rising to €1,094m. The highlight of the company’s results however was the increase in operating profits. These jumped by 28.8% to €67m, an operating margin of 6.1% compared with 5% the year before. The improvement was largely due to a combination of improved quality of revenue streams, increased tariffs and a focus on cost reductions. Economic weakness in Germany, France and Italy continued to impact on the growth of the domestic parcels business. However China, South East Asia and the Middle East saw double digit growth.
Logistics
After poor recent performances, TNT Logistics was able to post growth in both revenues and profits. Revenues grew by 4% to €920m whilst operating profits rose by 5% to €21m. Margins remained at 2.3%. Management stated that it had been able to reverse the trend in falling profitability through its cost cutting programme, particularly in poorly performing countries, namely France, Italy and Germany. The majority of savings were achieved in procurement and contract rationalization.
