Kuehne + Nagel caps strong first half with major cold-chain acquisitions
Swiss logistics company Kuehne + Nagel is riding the resurgence of airfreight and expanding its volumes across modes, as the company adds thousands of employees and expands its position in the perishables logistics sector with acquisitions in the United States and Kenya.
Kuehne + Nagel’s logistics business is booming, especially on the airfreight side, where volumes were up 18 percent for the first half of 2017, compared with the previous year, with net turnover at the Switzerland-based logistics provider up by 8.2 percent to US$9.25 billion. Posting numbers like that pushed up operating expenses, largely from hiring 9,000 employees since last April, depressing operating results (EBITDA), which only rose 1.3 percent, year-over-year, to $554 million.
K+N credited “strong demand for industry-specific airfreight solutions” as underpinning air cargo demand, noting that there was particular growth in the pharma, aerospace and perishables industries. The company added an additional 540,000 square meters of warehousing and logistics space over the first half of 2017, as well.
Airfreight EBIT was $154 million, up 2.7 percent, y-o-y. The pace accelerated in Q2, with the company carrying 66,000 tonnes by air.
Across other modes, results were also “suitably impressive,” in the words of the company’s chief financial officer, Markus Blanka-Graff. Seafreight, for instance, seems to be turning a corner as well, and with a 7.7 percent, y-o-y, increase in volumes, K+N outpaced the market in the first half of 2017, handling more than 151,000 twenty-foot-equivalent units (TEUs) – more than in the previous year’s period.
Looking ahead, K+N is adding locations to its global cold-chain network. “The business potential in the steadily growing global perishable sector is huge,” said the forwarder’s board member Yngve Ruud.
The two acquisitions – Los Angeles-based Commodity Forwarders and Trillvane Ltd, one of the largest perishables specialists in Kenya – add more than 150,000 tonnes of perishables capacity to Kuehne’s network.
Commodity Forwarders has an extensive footprint in airfreight forwarding, and its acquisition makes Kuehne + Nagel the number-two airfreight forwarder in the U.S.