UPDATE 2-Kuehne & Nagel confident to outperform market

* Company posts Q1 net profit of 131 mln Sfr, beats poll

* Sees no major impact from volcano eruption

* Sees sea freight volumes growing 12 pct in 2010

* Shares flat, outperforming weaker market, competitors

(Releads, adds details, background)

By Catherine Bosley

ZURICH, April 19 (BestGrowthStock) – Logistics group Kuehne & Nagel
(KNIN.VX: ) aims to outperform the market this year as the sector
recovers thanks to a pick-up in global trade, the group said on

The Swiss group reported a first-quarter net profit of 131
million Swiss francs ($124.3 million), more than analysts had

Chief Financial Officer Gerard van Kesteren said he expected
air traffic to improve this week, after the eruption of an
Icelandic volcano grounded planes across Europe, with logistics
companies then facing the challenge of drawing down backlogs.

“We are confident of offering those services for the
customer without any (major) impact on the profit and loss
account,” he said.

Shares in the company traded flat at 114.10 Swiss francs by
0833 GMT, outperforming a weaker Swiss mid-cap index (.SSMI: ) and
a 0.17 percent drop in Swiss rival Panalpina (PWTN.S: ).

“The effect of the volcano won’t be huge,” Helvea analyst
Chris Burger said. “It only affects Europe and air freight….If
it’s not flowers or something similar, it will just remain in
warehouses and will be transported a week later.”

Air industry body IATA, however, warned the economic impact
of the volcano on airlines would be more severe than the impact
of the attacks in the United States on Sept. 11, 2001.

Along with Panalpina and Deutsche Bahn’s Schenker [DBN.UL],
Kuehne & Nagel spent much of last year grappling with a fall in
transport demand due to the global recession.

But Kuehne & Nagel CFO van Kesteren said the group was
raising its outlook and expected its sea freight volumes to grow
12 percent in 2010 and its air freight volumes to rise 15
percent, after both areas saw significant improvement in the
first three months of the year.

Sea freight accounts for about 60 percent of the firm’s
profitability, the CFO said, adding he expected Kuehne & Nagel
to gain market share from shipping companies and smaller
competitors in coming years so as to enable it to outperform the

Kuehne trades at 20 times forecast 2011 earnings, while
Panalpina trades at 21 times.
(Editing by Sharon Lindores)
($1=1.054 Swiss Franc)

UPDATE 2-Kuehne & Nagel confident to outperform market