The company’s Express division had a decline in revenues of 15.5%. It attributes 5.1% of that loss to lower fuel surcharges and foreign exchange. Operating income for Express was € 20 million on total revenues for the quarter of € 1,364 million.
“Mail performance was good but impacted by higher employee-related expenses, a disadvantageous product mix and price pressure,” claims Peter Bakker, TNT’s CEO. “With the Dutch mail market now fully open to competition, a further significant decrease of cost levels is required going forward.” Addressed mail within the Netherlands was down 4.7% year-over-year. Mail division operating income was € 149 million, some 23.2% lower than the same quarter in 2008.
Providing an overview, Bakker observes, “The global economic operating environment has remained challenging. Despite this environment, I am pleased with the quick response of our management teams around the world. Significant cost savings have already been achieved without any sacrifice in our service levels towards our customers. The first quarter 2009 results continued the trend we saw at the end of 2008 and the beginning of this year.”
In the company’s view, pressure on the global economy will continue through the remainder of the year. As a result, TNT revenues will be down in comparison to 2008. Volumes of addressed mail within the Netherlands are expected to continue to decline. The carrier has undertaken cost cutting measures with a target of € 400 million to be saved in 2009.
“Nothing has changed with respect to our previously indicated cautious stance towards 2009:,” continues Bakker. “We assume trading conditions of Q1 2009 to persist through the rest of the year, although recent stabilization in Express is a welcomed situation.”