Freight forwarder Kuehne+Nagel's operating profit fell 45% in the first quarter, but exceeded forecasts, the company said, as markets and supply chains recovered from pandemic-related disruptions.
Falling global consumer demand, soaring inflation and high inventories have dragged freight rates down from pandemic heights, denting earnings of Switzerland's Kuehne+Nagel and Denmark's DSV.
Operating Profit Declines
Kuehne+Nagel's operating profit fell to CHF 612 million (€621.7 million) in the quarter. This exceeded market consensus by 19%, Bernstein analyst Alex Irving said.
"Sea Logistics was the standout performer," Irving wrote in a note to clients, adding that the group's biggest division beat operating profit estimates by 42%.
"Air was softer, clearly going through a soft patch as supply chain normalisation progresses and less air is needed to circumvent ocean disruption," Irving added.
'Holding Its Own'
Chief executive Stefan Paul said the macroeconomic situation remained "extremely challenging" but Kuehne+Nagel managed to "hold its own in this environment and expand its market share worldwide".
Kuehne+Nagel, which operates in more than 100 countries, said that compared to its pre-pandemic performance and in the context of a normalised business environment, the quarterly figures represented a "record result".
Earlier this week, DSV, the world's third-largest freight forwarder, predicted a recovery in global trade volumes after the firm surpassed profit forecasts in the first quarter despite seeing lower volumes and freight rates.
Read More: Danish Logistics Firm DSV Eyes Recovery In Global Trade Volumes
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