TNT Profit Falls as Dutch Mail Business Loses Market Share

[TrueBlueTerrier]

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May 2 (Bloomberg) -- TNT NV, the Dutch mail carrier that’s spinning off its express division, said first-quarter profit fell 14 percent as the former monopoly lost market share.

Net income dropped to 123 million euros ($182 million) from 143 million euros a year earlier, the Hoofddorp, Netherlands- based company said in a statement. TNT restated the year-earlier figures to include only businesses it plans to retain. Sales rose 4.3 percent to 1.11 billion euros on that basis.

The mail business “performed in line with expectations,” Chief Executive Officer Peter Bakker said in the statement. “The necessary steps towards the separation of the mail and express businesses have now been completed.”

TNT, which had a legal monopoly on letter delivery in its home country until 2009, aims to eliminate 11,000 jobs as customers turn increasingly to domestic competitors or e-mail. The company reiterated today that it was bracing for an 8 percent to 10 percent full-year decline of its Dutch addressed mail volumes.

TNT fell to its lowest price since July 2009, dropping as much as 1.21 euros, or 7.3 percent, to 15.42 euros. The stock, which has declined 19 percent this year, was down 3.8 percent at 10:15 a.m. in Amsterdam, valuing the company at 6.1 billion euros.

Operating profit from the mail unit dropped 35 percent to 125 million euros as the volume of addressed mail fell 8.6 percent in the quarter, TNT said.

Express Loss

TNT began separating its two main businesses last year. The Dutch mail operations will be renamed PostNL after completion of their split from TNT Express, Europe’s second-largest express- delivery service after Deutsche Post AG’s DHL division.

The express unit, presented as discontinued operations, posted a loss of 79 million euros, compared with an operating profit of 59 million euros a year earlier, burdened by a non- cash charge of 120 million euros related to restructuring in Brazil. The unit’s sales rose 6.6 percent to 1.8 billion euros.

TNT installed new management at express operations in Brazil in March to end losses after a drop in delivery volume. The company aims to turn around the Brazilian unit by no later than the second half of 2012, TNT said today.

The express business may be sold within six months if a public offer for the the shares TNT doesn’t own wins boardroom support, the company said in an April 11 prospectus. Otherwise, TNT has pledged to keep its remaining 29.9 percent stake in the spun-off unit for at least that period.

Shares in the express unit are due to start trading in Amsterdam after TNT shareholders approve the separation. The company’s investors will meet on May 25.

[Judgee]

Hmmm what goes around comes around as they say!

[maisymoo04]

and it will get worse when we have our say on how much we charge haha made up join the club tnt