Status Report

Turnover

In 2018, Kuehne + Nagel’s turnover amounted to CHF 24,825 million representing an increase of 11.7 per cent or CHF 2,605 million compared to the previous year. Organic business growth resulted in an increase in turnover of CHF 2,344 million (10.5 per cent) and acquisitions contributed CHF 261 million (1.2 per cent). The turnover increase was driven by the significant volume growth in all business units and regions.

Volumes in Seafreight increased by 7.7 per cent (+ 335,000 TEUs) whereas turnover per TEU decreased by 1.2 per cent to CHF 1,997 per TEU (2017: CHF 2,022). In Airfreight, the volume increase was 11.0 per cent (+ 173,000 Tons), and the freight rate increase was at 6.4 per cent per 100 kg to CHF 322 (2017: CHF 303). Significant volume increases were also achieved in Overland and Contract Logistics.

From a regional view, Europe, Middle East, Central Asia and Africa “EMEA” (9.1 per cent), the Americas (18.5 per cent) and Asia-Pacific (12.0 per cent) reported an increased turnover in 2018.

Exchange rate fluctuations between 2017 and 2018, based on average yearly exchange rates, led to an increased valuation of the Euro and the British Pound by 3.9 and 2.7 per cent respectively, a decreased valuation of the US Dollar as well as dependent currencies by 0.9 per cent, against the Swiss Franc, resulting in a positive impact of CHF 181 million (0.8 per cent) on turnover.

Net turnover

In 2018, Kuehne + Nagel’s net turnover amounted to CHF 20,774 million representing an increase of 11.7 per cent or CHF 2,180 million compared to the previous year. Organic business growth resulted in an increase in net turnover of CHF 1,783 million (9.6 per cent) and acquisitions contributed CHF 261 million (1.4 per cent). The exchange rate fluctuation had a positive impact of CHF 136 million (0.7 per cent).

From a regional view, EMEA (9.3 per cent), the Americas (17.0 per cent) and Asia-Pacific (13.5 per cent) reported an increased net turnover in 2018.

Gross profit

Gross profit reached CHF 7,709 million in 2018, which represents an increase of 9.8 per cent or CHF 686 million compared to the previous year. Organic business growth resulted in an increase in gross profit of CHF 528 million (7.5 per cent), mainly in the business unit Contract Logistics (+ CHF 318 million). The positive effect from volume growth in Sea and Airfreight was partially offset by lower yields in a competitive market environment with volatile supplier rates. Exchange rate fluctuation had a positive impact of CHF 96 million (1.4 per cent) and acquisitions contributed CHF 62 million (0.9 per cent).

From a regional view, EMEA (8.1 per cent), the Americas (13.6 per cent) and Asia-Pacific (14.1 per cent) reported an increased gross profit in 2018.

Operational cash flow

The operational cash flow, the sum of the net income for the year plus/minus non-cash-related transactions, increased by CHF 8 million to CHF 1,156 million in 2018 (for further information, please refer to the cash flow statement in the Consolidated Financial Statements 2018.

EBITDA

In 2018, earnings before interest, tax, depreciation, amortisation and impairment of property, plant and equipment, goodwill and other intangible assets, increased by CHF 59 million or 5.1 per cent compared to the previous year; EBITDA of organic business increased by CHF 39 million, acquisitions contributed CHF 5 million, and positive exchange rate development accounted for EBITDA of CHF 15 million.

EMEA generated the largest EBITDA contribution with CHF 693 million (57.3 per cent), followed by the Americas with CHF 263 million (21.8 per cent), and Asia-Pacific with CHF 253 million (20.9 per cent).

EBIT ⁄ Earnings for the year

In 2018, earnings before interest and tax (EBIT) increased by CHF 50 million to CHF 987 million (2017: CHF 937 million). The increase was mainly due to higher contribution from the organic business by CHF 44 million, whereas acquired business volumes had a negative impact of CHF 5 million, after accounting for the amortisation of intangible assets of CHF 8 million; the exchange rate development had a positive impact of CHF 11 million. The EBIT margin to net turnover for the Group decreased slightly to 4.8 per cent compared to 5.0 per cent in 2017. EBIT in per cent of gross profit (conversion rate), an important KPI for the Group, decreased from 13.3 per cent in 2017 to 12.8 per cent in 2018.

In 2018, the region EMEA contributed CHF 545 million (55.2 per cent) to the Group’s EBIT, followed by Asia-Pacific with CHF 232 million (23.5 per cent), and the Americas with CHF 210 million (21.3 per cent).

Earnings for the year 2018 increased by CHF 32 million to CHF 772 million compared to the previous year’s CHF 740 million, whereby the margin decreased to 3.7 per cent (in per cent of net turnover) compared to the previous year’s 4.0 per cent.

Earnings for the year were positively impacted by the tax reform in the USA and the Group expects a positive impact on the effective tax rate based on the above for 2018.