Irish Freight & Logistics Monthly – May ’11

Exports grow by 9.4% in first quarter
The Irish Exporters Association has reported export growth of 9.4% for the first quarter of this year, a stronger than anticipated rate. The IEA revised its full-year growth estimates to €14.8 billion (9.1%), but warned of a ‘risky international trading climate’. It revised its full-year forecasts for merchandise and service export growth to 10% and 8.0%, respectively.

Export growth was boosted by merchandise sales, which increased by almost €2.19 billion (10.5%) in the first three months of this year compared with the same period last year. Services exports also rose, by €1.33 billion, in the same period. In a statement, IEA chief executive john Whelan said that growth in merchandise exports was driven by 19% growth in the pharmaceutical sector and 17% growth in the agri-food sector.

He said that severe weather in competitor countries, diversion of agri-crops to bio-fuels and ‘the extraordinary growth in Asia’ all contributed to the agri-food growth. Mr Whelan also pointed out that merger and acquisition activity last year led to rapid growth in output from the sector.

The IEA expects Irish exports growth to exceed the global average this year. Mr Whelan warned that the euro’s exchange rate with sterling and the US dollar was very important for Irish exporters. Any further significant weakening of either of those currencies could make life difficult for a large number of Irish exporters, he said.

Phoenix International Awarded AEO Status

Phoenix International Freight Services Ltd has been awarded Authorised Economic Operator (AEO) status in Ireland. This EU accreditation enables Phoenix to give its customers the satisfaction of knowing that their business is being handled by an organisation trusted by Irish Revenue & Customs (Dublin and Shannon offices) and HM Revenue & Customs (Belfast office).

AEO status is an internationally recognised quality mark indicating that a firm’s role in the international supply chain is secure and that its customs controls are efficient and compliant. Authorized Economic Operator shipments are subject to fewer physical and documentary examinations. In those instances where shipments are called for control the process will be prioritised in relation to the examination and clearance of the goods.

Phoenix achieved the highest possible status – AEOF – which includes customs simplifications and security. For further information on AEO follow the below URL link: htttp://www.revenue.ie/en/customs/businesses/economic/aeo-faq.html

Kuehne + Nagel Airfreight Soars

In the first three months of 2011 Kuehne + Nagel’s airfreight business saw a 21 per cent increase in volume, outpacing a market expansion of between six and seven per cent. Volumes were given a boost following acquisitions in South America. The company is raising its guidance for airfreight shipping volume for this year to 18 per cent from 12 per
cent, due in part to the January acquisition of Translogo, a Colombia based shipper of perishables.

Double-digit growth was also achieved in the first quarter in worldwide exports for the automotive industry. Due to the above-market average volume growth and increased productivity revenue-to-gross profit margin improved from 28.7 to 32.3 per cent. The operational result rose by 28.6 per cent to CHF 63 million (US$70 million).

Hapag-Lloyd sails into the red in Q1

Hapag-Lloyd dropped into the red in the first quarter and warned it will pursue rate increases. Over the first three months of the year, the German-carrier saw revenue jump by 16.5% year on year to reach €1.4 billion (US$1.9bn), but after deduction of interest payments and taxes, it reported a loss €22.1 million.

Earnings before interest and taxes totalled €12.3 million, compared with €18.4 million in the first three months of 2009. It said the jump in revenue was down to increased freight rates, which were 10% higher than in the first quarter of 2010, at an average of $1,563 per teu. The loss was caused by increased fuel costs – the average bunker price in the first quarter rose from $454 per tonne to $509 per tonne – and more competition.

Chairman Michael Behrendt said: “Given the prevailing conditions, we achieved a good result in the first quarter. “Nevertheless, the rise in the oil price, the weak US-dollar and growing competition are making business more difficult. “Our aim must be to see that the additional external challenges are covered by appropriate rate increases.”

Hapag-Lloyd also revealed it had rejected some contracts on Far East trade lanes as it felt they were of “lower price quality”. As a result, volumes on these trade lanes dropped from 284,000teu in the first three months of 2009 to 260,000teu during the same period of 2010.

Overall, volumes during the period increased by 2% to hit 1.2 million teu. Its Atlantic volumes more or less reached the previous year’s level with a volume of 273,000, in the trades with Latin America, volumes increased by 6.5% to reach 265,000teu, its transpacific services reported a positive trend, with volume during the period rising from 238,000teu to 266,000teu and Australasia saw volume increase by 6.1% to 134,000teu.

Strong start to 2011 for DFDS

DFDS’s transport and logistics activities “greatly improved” in the first quarter of the year, which helped the ferry operator post strong results for the period. The company recorded revenue growth of 67% to Dkr2.6 billion (US$494 million), driven by the acquisition of Norfolkline and growth on Baltic Sea and North Sea services.

CEO Niels Smedegaard said: “We have seen a mixed picture, with strong growth in the Baltics and lower growth on the North Sea. Results in the transport and logistics area have greatly improved.”

“Overall, the first quarter has got us off to a good start for the rest of the year.”

Operating profit for the quarter increased 76% to Dkr183 million, while pre-tax profit in the first quarter improved by Dkr69 million year on year to Dkr7 million. DFDS is aiming for a pre-tax profit of Dkr550 million for the full year.

Good start to the year by Ceva

Ceva Logistics reported continuing strong revenues in the first quarter, following record turnover last year, and has announced the launch of a new division, Supply Chain Solutions. The operator recorded Q1 revenue of €1.68 billion (US$2.42bn), up 13.3% year on year, with ebitda continuing to show improvement, at €71 million for the quarter – up 36.5% year on year.

CEO John Pattullo said: “I’m delighted with our strong performance. “These results prove the benefits of the structural changes we made in 2010 and position us well for continued growth and development.”

Ceva saw strong results in both air and sea freight, with increased volumes, particularly on transatlantic lanes, and margins improved year on year. Upbeat results came from Ceva’s operations around the world, particularly in Asia-Pacific. The region was driven by strong performance in automotive, consumer and technology, said Ceva. During Q1, it achieved more than €528 million of new business, with a record performance in March.

Ceva also announced the launch of its new division, Supply Chain Solutions, and its latest service, Smart End to End. The company said the Supply Chain Solutions team would use the experience and expertise within the group to strengthen its global team and upgrade Ceva’s end-to-end solutions.

‘Warehouse Training Solutions’ Move To New Facility

Warehouse Training Solutions, the RTITB accredited training provider specialising in Lift Trucks, Manual Handling, Health and Safety and Logistics has recently relocated its training centre to Finglas, in North Dublin.

Martin Buckley, one of the three Business Partners, explained that the move coincides with the launch of the company’s new website, as well as the addition of new specialties in the training curriculum. Martin believes the new training centre will enable Warehouse Training Solutions to further reinforce the company’s reputation as the leading specialist in Lift Trucks, Health and Safety and Logistics training for both the public and private sector.

The company – which prides itself on the high quality training standards and customer service excellence – has now expanded its training portfolio to include the CILT accredited Logistics programme. For a full list of courses available please see www.warehousetraining.ie

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