April 28, 2015: TNT today reported first-quarter revenues of €1,622 million, up 1.3% year-on-year, and an operating loss of €11 million. Adjusted for disposals and foreign exchange, TNT's revenues declined 1.5%.
The drop in fuel surcharges and a trading day effect lowered first-quarter revenues by 2.1% and 1.5%, respectively. The underlying revenue growth, after correcting for all these factors, was 2.1%.
Reported operating income includes €12 million of restructuring and other charges, in line with guidance. Adjusted operating income decreased to €1 million, reflecting costs related to the execution of the Outlook strategy (€20 million), lower volumes from international accounts and pricing pressures, particularly in Western Europe.
Investments increased to €78 million (4.8% of revenues) in the first quarter, compared with €26 million (1.6% of revenues) the year before. Most capital expenditures went to sorting equipment, hubs, depots, vehicles and IT. Service performance, measured by on time delivery, continued to improve in all segments.
Tex Gunning, TNT's Chief Executive Officer, said: "Good progress is being made with the execution of the Outlook strategy. Service performance and revenues from SMEs further improved, supported by ongoing investments in infrastructure and IT. During the FedEx offer process, we will continue to focus on our customers and operational efficiency. The first quarter results were impacted by transition costs associated with the Outlook strategy. Our guidance is unchanged: we expect 2015 to be a challenging year of transition, followed by year-on-year improvements from 2016 onwards.