TNT reports 3Q14 results, announces €185 million investment in core European road network [Integrator]
-Reported operating income €47m negative (3Q13: €3m positive), impacted by restructuring provisions and provision of €50m for French competition case, reported revenues €1,646m (-2.0%)
- Adjusted operating income up 28.2% to €50m (3Q13: €39m), adjusted revenues down 3.0% year-on-year, but up 2.7% if restated for disposal of China Domestic and Dutch fashion business
- Period end net cash €414m (2Q14: €395m)
- Four-year €185m investment in core European road network as part of Outlook programme
Commenting on this quarter’s developments, Tex Gunning, CEO said:
‘In our recent trading statement, we highlighted the challenging trading conditions in Europe. Visibility on these trading conditions remains limited. Despite this, this quarter saw another improvement in our adjusted operating income, with every segment making a positive contribution apart from Europe Other & Americas where performance was broadly flat. Supporting this was the progress made in rolling out Outlook, including ongoing Deliver!-related cost savings, which were €28m during the quarter.
The Outlook strategy focuses on improving performance and productivity across the company, including increasing automation in TNT’s hubs and depots, launching new marketing campaigns and continuing to focus on providing our customers with a market leading service.
Central to the Outlook strategy in the next three to five years is the investment programme in TNT’s businesses.
The new €185m investment in TNT’s European road network that we announce today will improve efficiency and service quality and strengthen TNT’s position as the preferred road delivery service in terms of quality, speed, coverage and value.
Our management board is focused on creating a sustainable future for TNT. We are looking forward to giving a full update on our progress and plans for the business during the Capital Markets Day on 18 February 2015.’
- Deliver!-related savings of €28m in 3Q14 and expected to be around €120m for the full year 2014.
- 3Q14 restructuring-related charges and restructuring-related implementation costs €46m (mainly France and unallocated), full-year expectations of approximately €185m
- Ongoing investments in Australia (new hubs), Italy (depot modernisation), UK and Liege EuroHub
- €185m investment announced in international European road network to increase productivity and improve service
- Launch of marketing campaign and new brand to boost visibility and drive sales from SME customers
- New segment reporting to be implemented at 4Q14, with full reconciliation. The new segments will be International Europe, Domestics, International AMEA. Expected non-cash goodwill impairment of €32m as a result of the new reporting structure
- Full update on guidance during Capital Markets Day on 18 February 2015
- Combined Europe Main and Europe Other & Americas operating results stabilising, even though visibility remains limited
- Asia Middle East & Africa and Brazil Domestic operating results to be significantly better than prior year, Pacific to show better operating results than last year
- Additional investments in marketing and brand of approximately €20m in 4Q
- Unallocated around €(30)m
- Forecasted €70-80m in capex in 4Q
Posted at 23:36