TNT Express received a 200-million-euro ($267 million) termination fee from UPS this month, a reminder of the failed merger deal for the European integrator.
Fourth-quarter results presented further disappointment for TNT, showing a 0.5-percent, year-over-year, decline in revenue to 1.86 billion euros, coupled with an operating income loss of 71 million euros. TNT’s overall loss for the quarter stood at 148 million euros, a 14.5-percent year-over-year improvement.
The weak economy in Europe remained one of the major challenges for TNT Express, according to Interim Chief Executive Officer Bernard Bot. This is a trend that has been seen in previous quarters, but Bot seems hopeful that European activity will improve.
“Our market position in Europe however remains strong, with healthy volume growth and positive customer churn,” he said in a statement. “Asia-Pacific showed solid year-on-year improvements, with positive results for the quarter and the year as a whole.”
Changes are coming for TNT Express in Asia, with the company exploring divestment opportunities in China as well as Brazil. The financial outcome of TNT’s cessation of Chinese domestic activities will be reported during the first quarter. Both moves will be outlined in a company strategy update to be released in March.
For the coming year in broad terms, TNT officials expect continued challenges in Europe and the Middle East and Africa, while little to no growth is expected in the Americas or Asia.
TNT’s strategic plan is expected to bring cost-saving ideas to the integrator, which has already been slashing through some of its businesses. Officials announced that 50 million euros in savings has been realized from a May 2011 cost-savings program and that two-thirds of its 100-million-euro goal for an additional savings program has been achieved. - Jon Ross