TNT plans to ditch logistics operation
Mail firm TNT has said it expects to sell its underper-forming logistics business in the third quarter.
The news came as the firm reported a 10.7 per cent rise in second-quarter operating profit.
Second-quarter earnings before interest and tax rose to pounds 233.6 million from pounds 211 million the year before, above a median forecast of GB Pounds 222.6 million in a poll of 12 analysts.
Revenue rose 5.8 per cent to GB Pounds 1.81 billion, after sales rose in all business segments.
Chief executive Peter Bakker said: “I am very satisfied with our strong performance in Q2 and the first half of 2006. Our ‘Focus on Networks’ strategy is delivering strong growth and record margins in Express, and robust performance in Mail.
“Based on the strong start to the year, I am pleased that we can upgrade our outlook for 2006. Also, the signing of the Logistics divestment should take place before the end of the third quarter. All-in-all, 2006 is expected to be a strong year for TNT.”
TNT – which runs its national distribution hub at Atherstone, Warwickshire – raised its guidance on its mail operating margin in 2006 to 18.5 per cent from 18 per cent.
It also said it saw its express operating margin at the high end of a nine per cent to 9.5 per cent range.
The express division competes with United Parcel Service, FedEx and Deutsche Post’s DHL.
The company said in December it wanted to sell its contract logistics business, which designs and manages supply chains and has a book value of about pounds 785.5 million. The business represents about one-quarter of group revenue.
