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Contract logistics drags down profit at Ceva

Hoofddorp, Netherlands:  Ceva Logistics, non-asset based supply chain management companies, reported improved third quarter revenue up 5.1% to €1.84bn (2011: €1.75bn) but profits were down due to weak contract logistics performance.

Marvin Schlanger, cief executive, says: “Weak economic conditions continued to weigh on customer sentiment in the third quarter.

“With no real prospect of a significant and sustained market recovery in the short term, we continue to focus our efforts on cost control to maintain our efficiency and on new business development to secure our future revenues and ensure we are ready to take advantage of any improvements in global markets.”

“This was a disappointing quarter in terms of our profit performance. We are addressing the decline in profitability with a comprehensive plan to reduce overhead costs and improve contract performance. We are targeting a net benefit of approximately €100m from these actions.”

In the third quarter group revenue increased 5.1% to €1.84 billion (2011: €1.75bn). Ebitda declined to €70m, primarily because of weakness in contract logistics in Southern Europe, Middle East and Africa.

Schlanger took over as CEO after John Pattullo retired on 12 October. Pattullo continues to serve on CEVA’s board of directors.