In 2016, Kuehne + Nagel expanded its global leading position in the business unit Seafreight where it exceeded the 4 million TEUs mark for the first time in container traffic. The Group extended with more than 1 million tons in Airfreight its global Number 2 position, reported on significant growth and profitability improvement in Overland and gained substantial business by large-scale projects for high-profile customers in Contract Logistics.
Kuehne + Nagel has specialised in complex end-to-end supply chain management solutions, which are managed via the global network of Logistics Control Towers and performed in cooperation with all Kuehne + Nagel business units. This one-stop offering not only increases transparency and efficiency in the supply chain but also optimises information flows between the participating partners. This allows Kuehne + Nagel to help its customers to improve customer service, a decisive factor in what is a highly competitive and volatile market environment.
With estimated 2.3 per cent global growth (2015: 2.7 per cent), 2016 marked another challenging year for the world economy. Developed economies continue to struggle with subdued growth and increasing political and economic uncertainty. Growth for these countries in 2016 is estimated to have fallen to 1.6 per cent versus 2.1 per cent in 2015.
In emerging markets growth declined further from 3.5 per cent in 2015 to 3.4 per cent in 2016 due to weak investment, low external demand, and little productivity growth. (Based on: World Bank, Global Economic Prospects, January 2017)
In 2016 the international logistics industry was confronted with world trade volume growth further slowing down and reaching the lowest level since the global financial crisis 2007/2008. The estimated world trade volume growth fell to 1.9 per cent versus 2.7 per cent in 2015.
Developed economies’ world trade volume growth reduced from 4.0 per cent in 2015 to estimated 2.0 per cent in 2016, whereas it increased in emerging markets from 0.3 per cent in 2015 to 1.9 per cent in 2016. (Based on: IMF, World Economic Outlook Update, January 25, 2017)
In addition, the market environment in 2016 was characterised by highly volatile freight rates as a result of the continued imbalance of capacity and demand of carriers and a fierce wave of consolidation in the shipping industry.
Above mentioned market characteristics in 2016 led to a decrease in turnover of the Kuehne + Nagel Group. However, the Group was able to increase gross profit by 4.8 per cent and improved its profitability significantly by reaching an EBIT growth of 8.8 per cent in 2016 (excluding negative currency impact of 0.8 per cent). In addition, with 5.6 per cent the Group achieved its target of 5.0 per cent EBIT in per cent of net turnover.