Kuehne & Nagel to Pay Special Dividend on 20% Earnings Jump

Kuehne & Nagel International AG (KNIN), the world’s biggest sea-freight forwarder, raised its dividend by 10 percent and suggest a special payout to shareholders after operating profit rose 20 percent.

Kuehne will pay shareholders 3.85 Swiss francs a share, compared with 3.50 francs a year earlier, and proposed an extraordinary dividend of 2 francs a share, the company said in a statement today. Earnings before interest and taxes rose 20 percent last year to 761 million francs ($865 million), Schindellegi, Switzerland-based Kuehne & Nagel said. The average analyst estimate collected by Bloomberg was for 763.8 million francs.

“In 2013, we fully concentrated on profitable growth,” Chief Executive Officer Detlef Trefzger said in the statement. “Through organizational adjustments, streamlined cost structures and a clear focus on margin improvements we achieved the goals we had set ourselves.”

Subdued economic activity is weighing on shipping companies as countries sharing the euro struggle in the aftermath of the longest recession since the currency was introduced, and growth in China and India slows. Kuehne’s contract-logistics unit closed 40 unprofitable locations to focus on profitable regions, and the company is trying to turn around its road- and rail-logistics business.

Net invoiced turnover rose 0.8 percent to 20.9 billion francs. Sea-freight volumes rose 3 percent, with air freight volumes increasing 3.8 percent.

Kuehne & Nagel forecast that its sea-freight volumes will rise 50 percent faster than the market this year, which it expects to advance 2 percent to 4 percent. The global air-freight market will increase by 1 percent to 3 percent.

DSV A/S (DSV), on Feb 6 said industrywide sea freight volumes grew 2 percent to 3 percent last year, and forecast growth may be as high as 5 percent this year. A.P. Moeller-Maersk A/S’s container-shipping line, the world’s largest, on Feb. 27 forecast global demand for seaborne container transportation to increase by 4 percent to 5 percent this year, while excess capacity will likely continue to depress freight rates.

To contact the reporter on this story: Richard Weiss in Frankfurt at rweiss5@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

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