Kuehne + Nagel International AG

Kuehne + Nagel reported Q2 recurring EBIT of CHF 381 million, up 6% year over year and 24% sequentially. Recurring group EPS rose 6% year over year, or 11% excluding currency headwinds. Sea Logistics EBIT was CHF 140 million, up 24% sequentially and down 6% year over year excluding currency effects, while Air Logistics EBIT was CHF 154 million, up 39% sequentially and 42% year over year excluding currency headwinds. Road Logistics EBIT was CHF 36 million, up 29% year over year on an organic basis, and Contract Logistics recurring EBIT was CHF 51 million, down 14% sequentially and 9% year over year excluding currency effects. Free cash flow in Q2 was CHF 116 million including CHF 40 million of disposal proceeds, and net working capital intensity improved to 5.5% from 6.0% at the end of Q1. Management raised full-year 2026 recurring EBIT guidance to CHF 1.35 billion to CHF 1.55 billion, up CHF 100 million on the low end and CHF 150 million on the high end, and said the target for the cost reduction program remains more than CHF 200 million of gross annualized savings, with more than CHF 120 million of impact in 2026.

Stefan Paul framed the quarter as evidence that volume growth, especially in Air Logistics, and disciplined cost control are improving profitability and market share. He said Sea Logistics is showing a solid yield trend, Air Logistics demand remains strong, and the company expects positive sea volume development in Q3 and Q4. He also stressed that the company is winning business across multiple units through cross-selling, particularly with tech customers and hyperscalers.

Markus Blanka-Graff highlighted that the cost reduction program delivered about CHF 50 million of savings in the first half and is still on track for more than CHF 200 million of annualized gross savings, with more than CHF 120 million of impact in 2026. He said Q2 free cash flow was CHF 116 million including CHF 40 million of disposal proceeds, while working capital increased by CHF 97 million in the quarter mainly due to air freight growth and freighter activity. He also noted net working capital intensity improved to 5.5%, back within the company’s guidance corridor, and reiterated the long-term preference for a small net cash position.

Analysts focused on whether contract logistics headwinds would continue and whether Q2 cost pressure would persist; management said start-up costs should continue into Q3, with the first positive P&L impact expected in Q4. On sea freight, management said the company still expects positive volume development in Q3 and Q4 and remains committed to a 1.5x GDP volume growth target, with Air Logistics still very strong. Questions on AI centered on whether savings would be retained in margins or passed through to customers; management said the first mover advantage should support growth, but acknowledged some benefits will eventually flow to customers and confirmed the CHF 100 million to CHF 150 million AI benefit is a gross EBIT amount at current cost assumptions.