Kühne & Nagel, the world's largest sea-freight company, has filed the best annual results in its history, thanks to its core business.

Net profit for 2005 at the Swiss-based company improved by 32.3 per cent to SFr315 million ($239.1 million), while turnover grew by just over a fifth to SFr14.5 billion.

Shareholders can expect a dividend of SFr5.50 per share, a quarter more than in 2004, according to a company statement on Monday.

The Swiss logistics and transport company said it increased its sea and airfreight volumes at more than twice the market rate, which generated nearly 80 per cent of total group turnover.

The volume of freight shipped by sea went up by nearly a fifth, whereas airfreight rose by 9.4 per cent. The latter increase was in spite of high fuel surcharges, the company said.

The expansion of Kühne & Nagel's overland operations forged ahead in 2005, following the acquisition of a number of German firms, according to the statement. This move strengthened road activities and enlarged the network and increased order volumes.

However, the company noted that "high integration and restructuring costs led to [an] expected drop in the operational result" of the Rail & Road Logistics unit.

Acquisition strategy

The operational result of Contract Logistics increased by nearly 20 per cent last year thanks to additional business in Europe, Canada and the United States.

The company said the unit's challenge in the coming year is the integration of ACR Logistics, the French firm which Kühne & Nagel acquired in 2005.

Its target for the current year includes outperforming the market on sea and airfreight business, while continuing its acquisition strategy to boost its overland operations.

"Given our strong presence in all key markets worldwide, we are well positioned to continue benefiting from globalisation and growing trade flows," said Klaus-Michael Kühne, chairman of the board.

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