TNT Express has revised its targets for 2011 to reflect a challenging trading environment.
In a third quarter business update, it said that for Europe & MEA revenue the target is to achieve muted growth, with an underlying operating margin of 8-9 per cent. It said that while trading was relatively resilient in EMEA, with overall steady volume development, worsening product mix negatively impacted the third quarter operating performance. Cost control and efficiency gains helped mitigate revenue pressure.
Asia Pacific’s second half operating result should continue the first half trend. The focus would be on optimising intercontinental capacity exposure. Asia Pacific profitability suffered from continuing weak Asia-Europe demand, leading to sub-optimal capacity utilisation in a soft pricing environment.
On the Americas, it said the continuing negative performance was being addressed through a full range of corrective measures. And TNT said it expected other networks to perform somewhat below the prior year.
It is looking for annualised cost savings of some 50m euros, with expected related charges and write-offs of 45-65m euros. The company has not changed its medium-term aims.