Bakker “satisfied” as TNT publishes Q1 results
CEO Peter Bakker said he was “satisfied” with TNT’s Q1 2010 results – as the figures illustrated signs of economic recovery. Reported revenues increased by 12.4% to EUR 2.75bn due primarily to higher revenues from Express. Reported operating income grew by 54% to EUR 251m because of a rebound in Express profitability as well as a good contribution from Mail.
Reported profit attributable to shareholders came in at EUR 143m (EUR 76m in Q1 2009). Net cash from operating activities was EUR 31m, a decrease of EUR 126m versus last year, due in large part to higher taxes paid and working capital outflow. Net debt held steady at around EUR 1.1bn.
Better operating income helped compensate for certain negative cash impacts. To show the underlying developments in the business, TNT excludes currency impact and, when relevant, corrects for working days and one-off items. Underlying revenues increased by 5.1% in Q1 2010. Underlying operating income increased by 28.3% to € 213m compared to Q1 2009.
TNT said it sees a modest improvement in the economy. Express volumes, revenues and results are expected to be well above 2009 levels, though could be tempered by continuing yield pressure and cost inflation. Mail volumes and results are expected to be below 2009 levels. TNT continues to focus on costs and cash.
Bakker said: “As noted in our 8 April AGM trading update, Q1 2010 continued to show a positive trend. Reported operating income from both divisions was up versus the prior year.
“We have every reason to be satisfied with the results in all parts of our business. The profit recovery testifies to the hard work of TNT’s employees around the world, squeezing the cost base and helping the company navigate through the 2008/09 economic crisis. However, as a guide for full year performance, this quarter also needs to be understood as having benefited from extra working days.
“Volumes in Express have improved, albeit against a soft Q1 2009 comparison. In recent weeks, volumes have almost returned to levels seen in the more normal trading period of Q1 2007, though some customer feedback indicates that this is partially driven by re-stocking of supply chains. The negative year-on-year yield development shows early signs of stabilisation. Because cost increases inevitably follow improving volumes, cost control will remain in sharp focus. I am pleased how TNT swiftly deployed road-based alternatives to help mitigate the impact of Iceland’s volcanic eruption.
“Mail achieved a good operating result due in part to an improved performance from Emerging Mail & Parcels. Addressed Mail volumes were down by 9.7%, on a comparable basis, which again points to the need for ongoing cost control and Master plan implementation.
“TNT is making good progress in the implementation of Vision 2015. Although TNT assumes a modestly improving business environment in 2010, the global economic recovery remains fragile. A continued focus on costs and cash will therefore remain essential.”
GROUP
– Operating income € 251m (€ 163m in Q1 2009); quarter benefited from four extra working days
– Profit attributable to shareholders € 143m (€ 76m in Q1 2009)
– Net debt stable versus year-end 2009
– Vision 2015 implementation as per AGM announcement progressing
EXPRESS
– Development of Express volumes continues to improve
– Negative year-on-year yield development shows early signs of stabilisation
– Underlying* operating income € 59m (€ 23m in Q1 2009)
MAIL
– Addressed mail volumes in the Netherlands declined by 9.7% (corrected for working days and one-off mailings)
– Good performance improvement Emerging Mail & Parcels
– Underlying operating income € 159m (€ 149m in Q1 2009)
