UPDATE 1-TNT Express to see impact of cost cuts in second half
AMSTERDAM, April 29 (Reuters) - Dutch delivery group TNT Express, the target of a failed $7 billion takeover by United Parcel Service, said the impact of cost-cutting measures would show up in the second half.
The collapse of the UPS bid forced TNT Express to come up with job cuts, divestments and other measures last month to turn around its performance as a standalone delivery firm.
It said it would cut 4,000 jobs, or about 6 percent of the workforce, over the next three years and create cost savings of 220 million euros a year by 2015 by improving efficiency.
It is also looking for a buyer for its troubled Brazilian unit, where it said it expects to reduce losses further, after agreeing to sell its Chinese domestic business last month.
Bernard Bot, interim chief executive, said trading conditions this year would continue to be difficult, especially in Europe, and that the restructuring measures would start to deliver results in the second half.
First-quarter adjusted earnings before interest and tax (EBIT) from continuing operations fell 16 percent to 38 million euros ($49.5 million), while revenue fell 4.5 percent to 1.67 billion euros.
Analysts in a poll commissioned by Reuters had expected underlying EBIT of 30.9 million euros on revenue of 1.804 billion euros.
TNT Express shares plunged in price after UPS withdrew its takeover offer and are down a third since the start of the year.
But its shares trade at a hefty premium to those of its peers by some measures, with a forward price to earnings-per-share multiple of 21.7 against 13 on average for its peer group, according to StarMine Smart Estimates.
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