(Updates with statement from CEO in third paragraph, share price in fourth.)
Aug. 1 (Bloomberg) -- TNT Express NV, Europe’s second- largest express delivery service, reported an 85 percent drop in second-quarter profit on losses in Brazil and Asia.
Net income fell to 4 million euros ($5.8 million) from 26 million euros a year earlier, the Hoofddorp, Netherlands-based company said in a statement today. Earnings before interest and taxes excluding one-off items and currency fluctuations declined 8.1 percent to 79 million euros, beating the 77 million-euro average estimate of 8 analysts surveyed by Bloomberg.
“Demand from Asia to Europe has been volatile, and we are optimizing our capacity accordingly,” Chief Executive Officer Marie-Christine Lombard said in the statement. “The turnaround in Brazil is on track,” though the short term will be “challenging.”
TNT Express rose as much as 55 cents, or 7.8 percent, and was up 3.6 percent at 7.31 euros at 9:11 a.m. in Amsterdam, valuing the company at 3.96 billion euros.
The express company has been coping with losses in Brazil and took a non-cash charge of 120 million euros related to restructuring its operations there in the first quarter. The company said today that it is sticking to its goal to turn around the unit by the second half of 2012.
On May 25, shareholders of TNT, which has been renamed PostNL NV, approved the spinoff of the express business, which competes with larger rival DHL, a division of Deutsche Post AG. The Dutch postal company has pledged to retain a 29.9 percent holding of TNT Express for at least six months unless the new company’s board receives and agrees to a takeover offer.
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