Kuehne & Nagel International Ag · SIX:KNIN
Kuehne & Nagel International — Kuehne + Nagel International — FY2008 Earnings Presentation
54 slides from Kuehne & Nagel International's earnings presentation, Mar 3, 2009
Slide 1: Analyst Conference – Result 2008
Kuehne + Nagel International Analyst Conference – Result 2008 March 3, 2009 Zürich, Switzerland
Slide 2: Reinhard Lange, CEO; Gerard van Kesteren, CFO
Reinhard Lange, CEO Gerard van Kesteren, CFO Analyst Conference – Result 2008 Page 2
Slide 3: Agenda
Agenda • Welcome and Highlights 2008 Gerard van Kesteren • Operating Review 2008 Reinhard Lange • Financial Review 2008 Gerard van Kesteren • Update on Antitrust Investigation Reinhard Lange • Outlook 2009 / Action Plan Reinhard Lange / Gerard van Kesteren Analyst Conference – Result 2008 Page 3
Slide 4: Agenda: Welcome and Highlights 2008
Agenda • Welcome and Highlights 2008 Gerard van Kesteren • Operating Review 2008 Reinhard Lange • Financial Review 2008 Gerard van Kesteren • Update on Antitrust Investigation Reinhard Lange • Outlook 2009 / Action Plan Reinhard Lange / Gerard van Kesteren Analyst Conference – Result 2008 Page 4
Slide 5: Highlights 2008
Highlights 2008 • 1 Half Year Achieved strong growth in all Business Units. • 2 Half Year Drastic reduction of Volumes in all Business Units due to economic crisis. • Another year of record result. • Proposed dividend of CHF 2.30 (+ 21 %). Analyst Conference – Result 2008 Page 5
Slide 6: Highlights 2008: Strategy and Finance
Highlights 2008 Strategy • Continued expansion in European Road Network through acquisition of Alloin Group, France. Finance • Capex stable at last year level. • Tax rate 23%. • Net Working Capital 2.7% of turnover vs. 2.9% in 2007. • Cash & Cash equivalents of CHF 1’018 million. Analyst Conference
Slide 7: Overview Financials 2008
Overview Financials 2008 CHF million 2006 2007 2008 - Gross Profit 5'253 6'014 6'253 - EBITDA 857 1'019 1'020 - Net earnings 459 539 588 - Cash & Cash Equivalents 600 812 1'018 Per share (CHF) - EPS (basic) 3.91 4.54 4.96 - Dividend 1.50 1.90 2.30 - Extraordinary Dividend 2.50 Equity % Total Assets
Slide 8: Income Statement
Income Statement Excl. CHF million 2006 2007 2008 Variance Forex Invoiced turnover 18'194 20'975 21'599 3.0% 9.7% Gross profit 5'253 6'014 6'253 4.0% 11.3% Gross profit margin 28.9% 28.7% 29.0% Total expenses (4'396) (4'995) (5'233) EBITDA 857 1'019 1'020 0.1% 5.8% EBITDA margin 4.7% 4.9% 4.7% Depre
Slide 9: Segment Reporting by Business Unit
Segment Reporting by Business Unit Invoiced Turnover Excl. Gross profit Excl. EBITDA Excl. Volum e CHF millio n Variance Variance Variance 2007 2008 Forex 2007 2008 Forex 2007 2008 Forex ∆ - Seafreight 9'641 10'032 4.1% 11.1% 1'270 1'377 8.4% 14.9% 427 458 7.3% 12.5% +2% - Airfreight 3'719 3'859 3.8
Slide 10: Segment Reporting by Region
Segment Reporting by Region Invoiced Turnover Excl. Gross profit Excl. EBITDA Excl. CHF millio n Variance Variance Variance 2007 2008 Forex 2007 2008 Forex 2007 2008 Forex - Europe 14'128 14'216 0.6% 6.1% 4'532 4'708 3.9% 10.8% 638 626 (1.9%) 2.2% - America's 3'958 4'235 7.0% 15.5% 885 907 2.5% 11.3
Slide 11: EBITDA per Business Unit
EBITDA per Business Unit 2007 2008 Contract Contract Logistics Logistics 24% Road & Rail 21% Logistics 2% Road & Rail Logistics 3% Others Others 9% Airfreight 10% 22% Airfreight 21% Seafreight 43% Seafreight 45% Analyst Conference – Result 2008 Page 11
Slide 12: Shareholders Structure Kuehne + Nagel, December 31, 2008
Shareholders Structure Kuehne + Nagel December 31, 2008 Free float 42.6% Kuehne Treasury Holding shares 55.8% 1.6% Analyst Conference – Result 2008 Page 12
Slide 13: Agenda: Operating Review 2008
Agenda • Welcome and Highlights 2008 Gerard van Kesteren • Operating Review 2008 Reinhard Lange • Financial Review 2008 Gerard van Kesteren • Update on Antitrust Investigation Reinhard Lange • Outlook 2009 / Action Plan Reinhard Lange / Gerard van Kesteren Analyst Conference – Result 2008 Page 13
Slide 14: Financial Performance 2004 – 2008: Turnover and Gross Profit
Financial Performance 2004 – 2008 (in CHF million) Turnover Gross Profit 25'000 20'975 21'599 7'000 6'014 6'253 18'194 20'000 6'000 5'253 14'049 5'000 15'000 11'563 4'000 2'769 10'000 3'000 2'323 2'000 5'000 1'000 0 0 04 05 06 07 08 04 05 06 07 08 20 20 20 20 20 20 20 20 20 20 Analyst Conference – R
Slide 15: Financial Performance 2004 – 2008: EBITDA and Net Earnings
Financial Performance 2004 – 2008 (in CHF million) EBITDA Net Earnings 1'200 700 1'019 585 1'020 600 536 1'000 857 459 500 800 400 324 575 600 478 239 300 400 200 200 100 0 0 04 05 06 07 08 20 20 20 20 20 04 05 06 07 08 20 20 20 20 20 Analyst Conference – Result 2008 Page 15
Slide 16: Financial Performance 2004 – 2008 (in CHF million)
Financial Performance 2004 – 2008 (in CHF million) 1'200 1'019 1'020 EBITDA 1'000 857 800 575 600 478 585 536 Net Earnings 400 459 324 200 239 * 0 04 05 06 07 08 20 20 20 20 20 Analyst Conference – Result 2008 Page 16
Slide 17: Financial Performance 2008: EBITDA
Financial Performance 2008 (in CHF million) 458 EBITDA 500 450 400 350 300 221 216 250 200 150 82 100 23 20 50 - t ht il i cs te ce gh ig a ta n af rei f re &R g is t Es ura Se A ir Ro a d L o Re al In s ct n tr a Co Analyst Conference – Result 2008 Page 17
Slide 18: Seafreight
KUEHNE-+NAGEL (f) Seafreight
Slide 19: Performance Business Unit Seafreight 2006 - 2008
Performance Business Unit Seafreight 2006 - 2008 Excl. TEU's GP/ EBIT/ 2006 2007 2008 Variance Forex '000 TEU TEU CHF million Invoiced turnover 8'306 9'641 10'032 4.1% 11.1% 2006 2'275 501 152 Gross profit 1'139 1'270 1'377 8.4% 14.9% 2007 2'618 485 148 EBITDA 374 427 458 7.3% 12.5% 2008 2'670 516 1
Slide 20: Market Position Seafreight
Market Position Seafreight Market share 2007 based on revenue 2.0% 1.8% 1.6% 1.4% 1.2% 1.0% 0.8% 0.6% 0.4% 0.2% 0.0% UPS SCS DHL DB Schenker Kuehne+Nagel Panalpina Expeditors SDV Sinotrans DSV/ABX Agility Source: Company reports and Kuehne + Nagel estimates Analyst Conference – Result 2008 Page 20
Slide 21: Airfreight
KUEHNE-+NAGEL (f) Airfreight
Slide 22: Performance Business Unit Airfreight 2006 - 2008
Performance Business Unit Airfreight 2006 - 2008 Excl. TONs EBIT/ 2006 2007 2008 Variance Forex '000 GP/ kg kg CHF million Invoiced turnover 3'386 3'719 3'859 3.8% 10.4% 2006 720 0.83 0.21 Gross profit 599 698 726 4.0% 10.6% 2007 818 0.85 0.24 EBITDA 166 219 221 0.9% 6.9% 2008 835 0.87 0.24 EBIT 151
Slide 23: Market Position Airfreight
Market Position Airfreight Market share 2007 based on revenue 12% 10% 8% 6% 4% 2% 0% UPS SCS DHL DB Schenker Kuehne+Nagel KWE Panalpina Ceva Expeditors Sinotrans Agility Source: Company reports and Kuehne + Nagel estimates Analyst Conference – Result 2008 Page 23
Slide 24: Road & Rail Logistics
KUEHNE-+NAGEL (f) Road & Rail Logistics
Slide 25: Performance Business Unit Road & Rail Logistics 2006 - 2008
Performance Business Unit Road & Rail Logistics 2006 - 2008 2007/2008 2006 2007 2008 Forex Acquisitions Growth CHF million % Invoiced turnover 2'474 2'821 2'853 1.1% (3.8% ) 7.8% (2.9% ) Net Invoiced Turnover 2'213 2'523 2'693 6.7% (3.8% ) 8.3% 2.2% Gross profit 458 515 590 14.6% (4.1% ) 12.0% 6.6%
Slide 26: EBIT development
EBIT development CHF million 2008 2007 Variance Rail & Road Logistics Q3 (10) (4) (6) Q4 (7) *2 (58) *1 51 *1 Impairment intangibles: <55> *2 Redundancy and other provision: <6> Analyst Conference – Result 2008 Page 26
Slide 27: Acquisition of Alloin Group of companies
Acquisition of Alloin Group of companies Analyst Conference – Result 2008 Page 27
Slide 28: Acquisition of Alloin Group of companies
Acquisition of Alloin Group of companies • Effective January 1, 2009 Kuehne + Nagel acquired 100% of the shares of the Alloin Group, Lyon, France. • The purchase price amounts to EUR 156 million. • Kuehne + Nagel has financed the acquisition with existing cash. • Purchase price allocation will be fi
Slide 29: Company background / Strategic reasoning
Company back-ground / Strategic reasoning • The Alloin Group is among the top 10 groupage providers in France with excellent management and integrated operations. • Comprehensive groupage network in France (53 locations) with full control of the business. • Further expansion of groupage network in E
Slide 30: Company Overview / Groupage Network
Company Overview / Groupage Network Map Organisational Setup 7 Regions 53 Cross-docking terminals (including 5 international branches) 5 Contract Logistics Warehouses 4 Offices for Sea & Air Logistics Shipment Data 2007 20’000 Shipments per day 2’850 tons Groupage per day 450 daily shuttles Analyst
Slide 31: Position in European Road Logistics improves from Nr. 8 to Nr. 6
Kuehne+Nagel’s position in European Road Logistics improves from Nr. 8 to Nr. 6 2007 Analyst Conference – Result 2008 Page 31
Slide 32: Financials 2008 Provisional
Financials 2008 Prov. EUR million Invoiced turnover 300 Gross profit 220 EBITDA 40 EBITA 20 EBIT * 10 * Assumption € 10 million amortisation Intangibles as per PPA Analyst Conference – Result 2008 Page 32
Slide 33: Market Position Rail & Road Logistics
Market Position Rail & Road Logistics Market share 2007 based on revenue 3.5% 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% DHL N. Dentressangle DB Schenker Kuehne+Nagel Dachser Geodis Rhenus Ziegler DSV/ABX Logwin Source: Company reports and Kuehne + Nagel estimates Analyst Conference – Result 2008 Page 33
Slide 34: Contract Logistics
KUEHNE+NAGEL ak Ss _ — — —. a — Contract Logistics
Slide 35: Performance Business Unit Contract Logistics 2006 - 2008
Performance Business Unit Contract Logistics 2006 - 2008 2007/2008 2006 2007 2008 Forex Acquisitions Growth CHF million % Invoiced turnover 3'916 4'666 4'732 1.4% (7.7% ) 1.5% 7.6% Net Invoiced Turnover 3'800 4'480 4'599 2.7% (7.8% ) 1.2% 9.2% Gross profit 3'019 3'490 3'514 0.7% (8.3% ) 1.5% 7.5% EB
Slide 36: EBIT development
EBIT development CHF million 2008 2007 Variance Contract Logistics Q3 15 23 (8) Q4 (18) *1 27 *2 (45) *1 Impairment intangibles: <15> *2 Provision for onerous contracts and others: <16> Analyst Conference – Result 2008 Page 36
Slide 37: Market Position Contract Logistics
Market Position Contract Logistics Market share 2007 based on revenue 8% 7% 6% 5% 4% 3% 2% 1% 0% UPS SCS DHL N. Dentressangle DB Schenker Kuehne+Nagel Ceva Fiege Ryder Wincanton Agility Source: Company reports and Kuehne + Nagel estimates Analyst Conference – Result 2008 Page 37
Slide 38: Agenda: Financial Review 2008
Agenda • Welcome and Highlights 2008 Gerard van Kesteren • Operating Review 2008 Reinhard Lange • Financial Review 2008 Gerard van Kesteren • Update on Antitrust Investigation Reinhard Lange • Outlook 2009 / Action Plan Reinhard Lange / Gerard van Kesteren Analyst Conference – Result 2008 Page 38
Slide 39: Currency Development CHF
Currency Development CHF Dec Dec Impact Variance % 2007 2008 Net Earning Balance Sheet Euro 1.6673 1.5033 (9.8%) US Dollar 1.1551 1.0714 (7.2%) British Pound 2.2878 1.5660 (31.5%) Income Statement Euro 1.6420 1.5883 (3.3%) US Dollar 1.1987 1.0851 (9.5%) (5%) British Pound 2.3965 2.0024 (16.4%) Impac
Slide 40: Reconciliation (CHF Mio.)
Reconciliation (CHF Mio.) Organic 2007 Forex Acq. 2008 Growth Invoiced turnover 20'975 (1'550) 374 1'800 21'599 Gross profit 6'014 (489) 131 597 6'253 EBITDA 1'019 (62) (1) 64 1'020 EBIT 693 (45) (19) 107 736 EBT 708 700 Net earnings 539 534 Staff 51'075 - 1'158 1'590 53'823 Analyst Conference – Res
Slide 41: Amortisation & Impairment of Intangibles & Goodwill
Amortisation & Impairment of Intangibles & Goodwill (including software) Actual Actual of which Forecast In CHF '000 2007 2008 impairment 2009 Seafreight 16 24 - 23 Airfreight 8 12 - 10 Rail & Road Logistics 74 19 - 33 Contract Logistics 42 59 15 47 Real Estate 5 1 - - Insurance Broker 1 - - - TOTAL
Slide 42: Development of Working Capital
Development of Working Capital CHF Mio Dec 2006 Dec 2007 Dec 2008 Trade receivables 2'259 2'606 2'214 Work in progress 283 322 269 Subtotal 2'542 2'928 2'483 Trade payables (1'111) (1'329) (1'129) Accrued trade expenses (853) (980) (764) Net Working Capital 578 619 590 Turnover (annualised) 18'194 2
Slide 43: Working Capital Management
Working Capital Management • Current economic environment will lead to further pressure on working capital. • Approx. 60 % trade receivables insured in 2008 versus 45 % in 2007. • Credit Insurance Policy covering 80 % of approved credit limit, focussing mainly on small and medium exposures. Analyst
Slide 44: Capital Expenditure in fixed assets
Capital Expenditure in fixed assets CHF Mio 2006 2007 2008 Forecast 2009 - Europe 189 150 198 165 - Americas 38 28 23 40 - Asia Pacific 15 33 8 15 - Middle East/Central Asia and Africa 5 20 16 5 Total fixed assets 246 231 245 225 Sea & Air Logistics 18 37 16 35 Road & Rail Logistics 24 20 9 40 Contr
Slide 45: Return on Capital Employed
Return on Capital Employed CHF Mio Capital ROCE in % EBIT Em ployed * 2007 2008 2007 2008 2007 2008 - Seafreight 388 414 125 99 > 100 % - Airfreight 197 198 128 28 > 100 % - Road & Rail (54) (10) 19 44 - - - Contract Logistics 105 54 566 541 19% 10% - Other 57 80 940 822 6% 10% TOTAL 693 736 1'778 1
Slide 46: Corporation Tax
Corporation Tax CHF Mio 2006 2007 2008 - Earnings before Tax 603 708 764 - Tax charge 143 169 176 - Effective Tax Rate 24% 24% 23% Effective Tax Rate for 2009 23% Analyst Conference – Result 2008 Page 46
Slide 47: Agenda: Update on Antitrust Investigation
Agenda • Welcome and Highlights 2008 Gerard van Kesteren • Operating Review 2008 Reinhard Lange • Financial Review 2008 Gerard van Kesteren • Update on Antitrust Investigation Reinhard Lange • Outlook 2009 / Action Plan Reinhard Lange / Gerard van Kesteren Analyst Conference – Result 2008 Page 47
Slide 48: Update on Antitrust Investigation
Update on Antitrust Investigation • October 10, 2007, various KN organizations have been inspected. • Class action lawsuits were filed in the USA. • Full co-operation with respective authorities. • No decisions have been received from the respective authorities. • No provision (see note 39 / 44 of A
Slide 49: Agenda: Outlook 2009 / Action Plan
Agenda • Welcome and Highlights 2008 Gerard van Kesteren • Operating Review 2008 Reinhard Lange • Financial Review 2008 Gerard van Kesteren • Update on Antitrust Investigation Reinhard Lange • Outlook 2009 / Action Plan Reinhard Lange / Gerard van Kesteren Analyst Conference – Result 2008 Page 49
Slide 50: Outlook 2009
Outlook 2009 • No qualified outlook possible. • However, further reduction in volumes expected in all business units especially in first semester. Analyst Conference – Result 2008 Page 50
Slide 51: Action Plan
Action Plan Cost Reduction • Reduce Manpower of operational staff in line with Volume reduction. • Reduce Overhead by 10 % versus Actual 2008. Optimize Cash Position • Freeze Capex. • Safeguard Accounts Receivables. Increase investment in future growth • Intensify Sales / Additional 400 Sales
Slide 52: Corporate Timetable 2009
Corporate Timetable 2009 03.03.2009 Press Conference / Analyst Conference result 2008 20.04.2009* Announcement First Quarter 2009 Result 13.05.2009 Annual General Meeting 2008 18.05.2009 Dividend distribution 2008 20.07.2009* Announcement Half-Year 2009 Result 20.10.2009* Announcement Nine Months 20
Slide 53: Thank you for your attention.
Thank you for your attention.
Slide 54: Disclaimer
Disclaimer Investing in the shares of Kuehne + Nagel International Ltd. involves risks. Prospective investors are strongly requested to consult their investment advisors and tax advisors prior to investing in shares of Kuehne + Nagel International Ltd. This document contains forward-looking statemen
Kuehne + Nagel International — FY2008 Earnings Presentation on 6ix