K+N wins long term contract with Spirit Pub Company

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The Spirit Pub Company has hired Kuehne +Nagel for a major long term contract to provide a 24 hour, six day per week service after the 3PL invested over £5 million in its facilities.

Under the contract Kuehne + Nagel will make some 125,000 deliveries per year, using 60 vehicles and employing some 300 people. It will run the operations from its two distribution centres in Trafford Park and Greenford, which provide a total of some 200,000 sq ft of warehousing space.

Kuehne + Nagel believes this development will make it the market leading 3PL in the food service business.

It has three multi-temperature distribution centres including a specialised food service facility in Wellingborough which it developed for its contract with Whitbread which it won in 2008. That contract covers logistics for Premier Inn, restaurants such as Beefeater, and all Costa Coffee shops.

The Spirit Pub Company has more than 800 managed pubs and 500 leased pubs, employing some 17,000 staff. It was demerged in September 2011 from Punch Taverns.

* The Kuehne + Nagel group has reported a rise in net earnings in local currency of 12.2 per cent for 2011. However, the strength of the Swiss Franc, meant turnover decreased by 3.3 per cent to CHF 19.6bn  (£13.5bn). On a currency adjusted basis there was an increase of 9.3 per cent). EBITDA at CHF 978m (£676m) was 2.6 per cent below the previous year’s level. On a currency adjusted basis the increase was 9.6 per cent.

The  group said that while transport and logistics volumes developed very positively in the first half of 2011, growth steadily slowed during the second half. Cautious consumer and investment behaviour in the USA and in large parts of Europe, the interruption of supply chains following the disasters in Japan and the significant rise in commodity prices affected the logistics business.

The group said that in contract logistics, 2011 was characterised by strongly divergent regional developments. While Germany and the Netherlands achieved excellent results, the business in some Southern and Western European countries was negatively affected by the softening consumer demand.

“This applies particularly to France, where the difficult development of results called for extensive restructuring measures. These will continue to have some impact in the current fiscal year. Good progress was made in the expansion of contract logistics activities in Asia and South America.”

In sea freight, K+N handled more than 3 million TEU for the first time in 2011. With a volume increase of 11 per cent, the company reckons it grew twice as fast as the international container market. Kuehne + Nagel achieved double-digit growth rates, particularly in the Asian and non-European trades. In the trans-Pacific lanes, Kuehne + Nagel expanded its volume by more than 15 per cent despite market contraction.

In airfreight, tonnage increase of 13 per cent exceeded expectations, particularly in view of the market’s cargo volumes, which were 0.7 per cent below the previous year’s figure. Kuehne + Nagel’s performance was due to the targeted expansion – accelerated by acquisitions – in the perishables logistics segment, and the intensified sales of industry-specific airfreight solutions.

European groupage activities were boosted by the acquisition of RH Freight Group in 2011, resulting in an above-market volume growth of ten per cent. The takeover of the German Drude Logistik, Bad Hersfeld, was of high strategic importance, the group said.

Reinhard Lange, chief executive of Kuehne + Nagel said: “The investments made in the year 2011 are geared to achieve sustainable and profitable growth and a further successful development of earnings. We are well positioned around the globe and therefore confident to reach our targets in the current business year again: Profitable growth above-market average in all business units. We are facing up to the uncertain economic development by consistent cost management, process optimisation and increased productivity.”

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