MEXICO CITY: April 15, 2019. Panalpina has expanded its pioneering Logistics Manufacturing Services (LMS) offering to include the installation of hardware and software for mobile network antennas.
The company says the move is prompted by the exponential growth of the telecoms infrastructure market with the advent of 5G technology and the subsequent need to upgrade network components.
“Conversations with a number of customers showed us that they had to deal with multiple suppliers and multiple installers for mobile network antennas,” said Mike Wilson, Panalpina global head of Logistics and Manufacturing.
“It was a real headache for them and virtually every time they wanted to replace or upgrade a site, the installation had to be postponed because of missing parts, equipment, team members or even due to the site not being prepared. Our research showed that on average 2.8 visits had to be made to a site before the installation could be successfully completed.”
As Panalpina was already delivering most of the components to the sites, it worked out how to consolidate and deliver them all together. The next step was to overcome the lack of installation coordination by creating a team of fully qualified telecoms personnel in Mexico.
Krasimir Banchev, global head of Installations Services Management at Panalpina added: “It was an intense few months. Our team had to go through various trainings, pass exams and get the right certification. We also had to develop the right commercial and legal frameworks that are very different to traditional 3PL arrangements.”
According to Wilson the move is a natural addition to its LMS offering where it manufactures and configures network equipment. “We started this in Mexico for two core reasons,” he explained. “Firstly, because we have such good customer relationships there. Secondly, because we have an amazing talent pool in Mexico.”
Panalpina has reported a 3.0 percent drop in 2019 Q1 gross profit to CHF358.1 million, while total operating expenses declined to CHF290.0 million. EBIT and consolidated profit increased year-on-year by 15 percent and 16 percent respectively. EBIT reached CHF28.1 million compared to CHF24.4 million a year before and the EBIT-to-gross-profit margin stood at 7.9 percent, up from 6.6 percent in 2018.
The Q1 consolidated profit increased from CHF16.6 million to CHF19.2 million. Good news for the proposed DSV/Panalpina share swap.
