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FRANKFURT—Kuehne & Nagel International AG, the world’s
biggest sea-freight forwarder, said first-quarter profit
surged 28 percent as the company handled more air and
ocean shipments and boosted sales of warehouse
management services.
Net
income climbed to 130.3 million Swiss francs ($108
million), or 1.1 francs a share, from 101.6 million
francs, or 86 centimes, a year earlier, the Schindellegi,
Switzerland-based company said Tuesday. Sales rose 14
percent to 4.87 billion francs.
Profit
was “modestly better than our estimate,’’ buoyed by
“surprisingly strong’’ airfreight demand, Chris Combe, a
London-based analyst with Jefferies International Ltd.
with a “buy’’ rating on Kuehne & Nagel’s shares, wrote
in a note to investors.
Kuehne &
Nagel makes most of its profit arranging shipment of
goods by sea and has increased sales as exports and
imports grow. The International Monetary Fund expects
world trade volume to gain 7 percent this year. Kuehne &
Nagel’s purchase of Paris-based ACR in 2005 expanded
warehouse and distribution management services for
companies such as Carrefour SA, Europe’s biggest
retailer.
Shares
of Kuehne & Nagel in
Zurich
rose 60 centimes, or 0.6 percent, to a record 107.5
francs. The stock has gained 21 percent this year,
valuing the company at 12.8 billion francs.
“The
market is very positive,’’ chief financial officer
Gerard Van Kesteren said in a telephone interview.
Expansion in the road-delivery business and the ACR
acquisition “helped us to obtain more business because
we now offer integrated service.’’
The
company plans to maintain its profit margin this year as
it grows at twice the market average of about 7.5
percent to 8 percent in sea freight and airfreight, Van
Kesteren reiterated.
Kuehne &
Nagel handled about 19 percent more sea freight and 10
percent more airfreight last year.
The
contract logistics unit will post revenue gains of about
10 percent, higher than the expected market growth of 6
percent to 7 percent, and the overland division’s sales
will grow “at least 10 percent,’’ he said.
The
sea-freight unit handled 14 percent more cargo last
quarter and increased revenue by 11 percent to 2.23
billion francs. The company arranged 13 percent more air
shipments.
Sales
grew 20 percent to 1.1 billion francs in the contract
logistics business, where Kuehne & Nagel manages more
than 65 million square feet of warehouse space and aims
to expand in
Asia, Latin America and eastern Europe.
“Contract logistics activities are becoming a growth
driver,’’ the company said.
Kuehne &
Nagel plans more acquisitions this year to add to
overland operations in Europe, where the company is
expanding from
Germany, chief executive officer Klaus Herms said in an
interview. That division boosted revenue by 21 percent
last quarter to 679 million francs.
“Parts
of the expansion won’t be achieved organically,’’ Herms
said. “One acquisition or the other will have to be
targeted. We have several hundred million Swiss francs
set aside’’ for purchases. --Bloomberg
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