Kuehne + Nagel International AG has accepted the resignation of CEO Reinhard Lange for health reasons, effective May 7.
Monday's announcement of Lange's departure came as the Swiss freight forwarder released lower earnings results for 2012.
The company's net profit fell 18.6 percent from 2011 to 493 million Swiss francs ($522.6 million). Operating profit fell 12.5 percent to 856 million Swiss francs, including a 65 million franc penalty paid to the European Commission for allegedly colluding with air carriers and other forwarders on surcharges in violation of anti-trust laws. The company is appealing the EC's decision before the European Court of Justice.
K + N said Chairman Karl Gernandt is leading a management team to search for a new CEO.
Gernandt said the company is streamlining the organization's management structure to be able to react more quickly and efficiently changing market dynamics and growth opportunities.
The world's second largest third-party logistics provider in terms of revenue enjoyed increased freight volumes last year, but blamed slow growth in China, reduced trade demand because of the ongoing financial crisis in Europe, transport overcapacity, and extreme rate volatility for cutting into its margins.
The company achieved a 6 percent gain in volume to 3.5 million TEUs even though the overall container market only grew 2 percent. Business was strongest from Asia to North and South America and to the Middle East, while Asia-Europe trade volume decreased slightly compared to 2011.
In a declining airfreight market, K + N was able to increase its tonnage by 2 percent, with strong growth in intra-Asia trade and exports from Asia to North and South America. The company said expansion of its perishable logistics services and new pharmaceutical and healthcare services helped boost its air cargo volumes.
Trucking revenue grew 7.4 percent in 2012, but volume slowed in the second half of the year due to the deterioration of Europe's economy, especially in Southern Europe, K + N said. One of the company's highlights was the opening of a European hub in Bad Hersfeld, Germany.
K + N said results were disappointing for contract logistics and the division is now focusing on controlled, profitable growth and expansion of activities for multinational customers. The company closed about 30 facilities to reduce costs. Operating profits decreased 6.2 percent due to one-off start up and restructuring costs and its margin fell from 3.9 percent to 3.5 percent for warehousing.
Lange's career at K + N spanned more than 40 years, during which he held senior management positions in the Asia-Pacific region, Germany and Canada. In 1999, he was elevated to the company's corporate office and helped K + N become the largest provider of international ocean freight services in the world. - Eric Kulisch