In 2023, Kuehne+Nagel reported a significant decrease in turnover, from CHF 43,034 million in 2022 to CHF 26,649 million, a 38.1% drop. This decline was primarily attributed to the normalisation of supply chains and a reduction in freight rates, coupled with overcapacity in sea and air freight markets.
Despite these challenges, the company handled 4 million TEUs and 2 million tons of volume respectively. The company’s net turnover stood at CHF 23,849 million, representing a 39.5% decrease from the previous year, while gross profit fell by 20.9% to CHF 8,787 million. EBIT dropped by 49.4% to CHF 1,903 million, and earnings decreased by 47.9% to CHF 1,464 million.
Nevertheless, the reduction in turnover and profits has not prevented Kuehne+Nagel from making strategic investments aimed at strengthening its market position and ensuring future growth.
The company’s 2023 financial results highlight several key areas of investment and strategic focus. First, the Roadmap 2026 strategy, introduced in March 2023, emphasises enhancing digital platforms and leveraging technology to improve logistics solutions. This includes significant investments in IT infrastructure and innovative technologies to streamline operations and enhance customer experiences.
Moreover, Kuehne+Nagel says it remains committed to sustainability and is aiming for a leading market position in emission transparency and providing access to low-carbon maritime fuels. The company has set targets to decarbonize its operations, including increasing the proportion of low-emission vehicles in its fleet.
During the investor call, CEO Stefan Powell and CFO Markus Blanke provided further clarity on the company’s performance and strategic direction.
Powell highlighted a notable improvement in Q2 2024 earnings before interest and tax (EBIT), achieving CHF 402 million, up from CHF 376 million in Q1 2024. This improvement was driven by a seasonal volume uplift and ongoing yield management.
Powell also addressed the cost-saving measures, indicating that the restructuring efforts initiated in early 2023 had yielded positive results, though inflationary pressures had offset some of these gains. The company estimates a net positive annualised EBIT effect of up to CHF 100 million from these cost savings by early 2025.
Kuehne+Nagel’s capital expenditures for 2023 amounted to CHF 306 million, a 28% increase from 2022. These investments were primarily directed towards operational and office equipment, property enhancements, and IT infrastructure. Notable investments included a forest conservation project in Wisconsin, USA, and office space in Buenos Aires, Argentina.
Additionally, Kuehne+Nagel entered into significant transactions aimed at bolstering its service offerings and market reach. In November 2023, the company agreed to acquire 100% of the shares of Farrow Group Inc., a Canadian customs broker, for CHF 166 million. This acquisition is expected to enhance Kuehne+Nagel’s value-added services and align with its Roadmap 2026 growth ambitions.
“Despite a demanding economic and political climate in 2023, we – Kuehne+Nagel International AG – continued to perform well. We remain the ultimate partner that can be relied on for outstanding logistics solutions even, or indeed in, challenging times. We quickly plan alternative transport routes for our customers if geopolitical events make a connection seem inopportune, for example,” said Joerg Wolle, Chairman of the Board of Directors of Kuehne+Nagel International AG, commenting on the results.