TNT Express NV made an official statement today, which revealed a third-quarter loss at a time when the company is taking restructuring measures. The performance of the company over the quarter was also affected by investigations over alleged anti-competitive practices in France, which led to extra expenses to cover the €50-million charge.
The Chief Financial Officer of the company, Maarten De Vries, said in a conference call, cited by Bloomberg: “We are losing market share, we have a competitive challenge. We need to catch up. We must improve our service quality, out IT, our brand, our efficiency and productivity.”
TNT Express revealed that its operating loss over the third fiscal quarter is estimated to €55 million ($69.7 million). In comparison, the company posted a €6-million net profit over the same quarter a year ago. TNT also said that it had to bear restructuring expenses, which amounted to €46 million. Its revenue fell by 2% from €1.68 billion during the third quarter a year earlier to reach €1.65 billion in the third fiscal quarter this year. TNT also projected that its full-year restructuring expenses were to amount to €185 million. At the same time, the company intends to eliminate 4 000 jobs.
As reported by the Wall Street Journal, the Chief Executive Officer, Tex Gunning, commented on the companys results over the quarter: “In our recent trading statement, we highlighted the challenging trading conditions in Europe.”
The company has been trying to consolidate its positions and stabilize its earnings by concentrating on its overland network located in Europe. TNT has been in negotiations with United Parcel Service Inc. in 2013, but the U.S.-based company dropped its €5.16-billion offer, aiming the acquisition of TNT, after the deal faced the opposition of the European Union regulatory authorities.
In September this year TNT dropped its plans to increase its adjusted operating profit as a percentage of sales to 8% in 2015.
TNT Express NV lost 7.21% to trade at €4.48 per share by 10:03 GMT, marking a one-year decrease of 34.13%. The company is valued at €2.65 billion. According to the Financial Times, the 17 analysts offering 1- month price targets for TNT Express NV have a median target of €6.00, with a high estimate of €9.00 and a low estimate of €4.50. The median estimate represents a 24.30% increase from the last price of €4.83.
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