Tag: International

TNT NV, Europe’s second-biggest express-delivery service, posted the first profit decline in five quarters because of the cost of cutting jobs and quitting U.K. parcel services.
Fourth-quarter net income fell 22 percent to 148 million euros (USD 217 million), or 40 cents a share, from 189 million euros, or 46 cents, a year earlier, Hoofddorp, Netherlands-based TNT said today. Sales rose 8.6 percent to 3 billion euros.
TNT put aside 110 million euros in the quarter to prepare for eliminating 6,500 jobs over the next three years at its mail business in the Netherlands, which has been struggling with rising competition and the substitution of personal letters by e- mail. TNT also said it may exit the German mail business in a dispute over minimum wages for letter carriers.
TNT shares rose 24 cents, or 0.9 percent, to 27.48 euros in Amsterdam. The stock has dropped 2.7 percent this year.
Talks with unions on the workforce cutbacks are likely to conclude in the second quarter, Chief Executive Officer Peter Bakker said at a press conference today. TNT probably won’t cut more than 6,500 positions, he said.
The provision is only a “first step” and the reorganization, including spending on retraining, may cost the company as much as 175 million euros between 2007 and 2009, Bakker said. The program is designed to achieve annual cost savings of 85 million euros by 2010.
TNT also took a 28 million-euro charge in the quarter for exiting a parcel-delivery contract in the U.K.
Analysts surveyed by Bloomberg had estimated net income would rise to 249 million euros. Sales matched the median estimate. Earnings before interest and taxes fell 29 percent to 253 million euros, counter to analysts’ prediction of an increase to 378 million euros.
The postal operator plans to increase the 2007 dividend by 16 percent to 85 cents a share.
TNT has bought express-delivery companies and mail carriers abroad, including stakes in two German regional services in 2007, to prepare for the country’s market opening last month.

TNT NV chief executive officer Peter Bakker has warned that TNT might withdraw from Germany if it loses its court case over the minmium wage its pays its German workers amid a dispute over the liberalisation of the German postal market.

‘If we lose the court case and the VAT situation remains, a withdrawal would be one of the possibilities,’ Bakker said at a press conference after the company’s fourth quarter results.

TNT lodged in January a lawsuit against the German state in a bid to have the alternative minimum wage it is paying its German-based workers to be declared valid.

TNT claims the German government is thwarting liberalisation of the German market by imposing a sector-wide minimum wage of up to 9.80 eur – a wage that Deutsche Post AG has already agreed on with trade union Verdi.

But the Dutch postal group claims that, unlike its rivals, Deutsche Post enjoys a VAT exemption for 40 pct of its operations in Germany.

TNT currently pays its German workers 7.50 eur per hour and claims that only Deutsche Post can afford to have the minimum wage set at the 9.80 eur level.

TNT N.V. today announces that Mr. J.H.M. Hommen will step down as Chairman of the Supervisory Board as soon as his intended successor will be ready to take over his position as chairman. Mr. Hommen steps down as Chairman in order to comply with the Dutch Corporate Governance Code, which limits the number of supervisory board positions in Dutch listed companies a person is allowed to have. He is planning to resign as member of the Supervisory Board in 2009 in accordance with the reappointment schedule of the Supervisory Board. Mr. Hommen has been Chairman of the Supervisory Board since 2005 and a member since 1998.

The Supervisory Board nominates Mr. P. Klaver and Mr. G. Ruizendaal as new members of the Supervisory Board for appointment to the Annual General Meeting of Shareholders on 11 April 2008 (AGM), whereby Mr. Klaver is the intended successor of Mr. Hommen in his position as Chairman of the Supervisory Board. Mr. Klaver is former Chairman of the Managing Board of SHV Holdings N.V. Mr. Ruizendaal is Chief Strategy Officer and Group Controller and a member of the Group Management Committee of Royal Philips Electronics N.V.

Mr. R.J.N. Abrahamsen, a member of the Supervisory Board since 2000, is nominated for reappointment at the AGM. Mr. R. W.H. Stomberg, a member of the Supervisory Board since 1998, steps down.

In accordance with the Corporate Governance Code, the Supervisory Board will notify the AGM of its intention to reappoint Mr. M.P. Bakker as CEO and member of the Board of Management of TNT N.V. and Mrs. M.C. Lombard as member of the Board of Management of TNT N.V., both for a new four year term.