It pointed to what it said were “deteriorating trading conditions in TNT’s European Express business [which] have significantly worsened in September.” It added that, based on the volume patterns in the first two weeks of October, TNT expects this pressure to continue in the fourth quarter.
“Within a context of severe global volatility in financial markets, the recessionary trend in the economy in Europe has accelerated, causing the volumes in the premium International Express (air) product to decrease around 10 per cent.” The Economy Express volumes (road) have continued to grow, TNT noted, albeit well below levels of 2007.
In the Express Emerging markets, the growth and margins continue to develop in line with TNT’s outlook, it said in the statement. Likewise TNT’s Mail business is also developing according to the group’s outlook, producing a robust operating income and cash fl ow for 2008.
TNT was able to refinance its capital requirements in August, ahead of the deepening of the financial crisis in September/October. Combined with the strong cash fl ow, this puts TNT on a solid fi nancial footing going forward, it said.
TNT said it will present an updated outlook for 2008 in its Q3 publication on 27 October. “The margins in the Express ‘International & Domestic’ line of business are currently expected to develop around a solid 9 per cent for the full year, with somewhat lower revenue growth. No changes in other lines of the outlook are currently foreseen.”
The company in 2007 reported �11 billion in revenues and an operating income of €1,192 million. TNT is publicly listed on the stock exchange of Amsterdam and is viewed as a key merger and acquisition target following reports that FedEx and DHL were interested.
