by Christopher Freeburn | March 25, 2013 10:23 am
Struggling shipper TNT Express (PINK:TNTEY) announced on Monday that it would shed jobs and overseas business in order to trim costs. Investors weren’t impressed, sending TNT Express shares down more than 4% in over-then-counter trading on Monday morning.
The Dutch company lowered earnings guidance for its European operations, whose results have been dented by the continent’s weak economy. It said that it will lay off 4,000 workers. The payroll cuts, combined with a contraction of its international air fleet, is expected to save $286 million, the Wall Street Journal noted.
By 2015, the company hopes to achieve an operating profit margin of 8% at its European business. That’s down from previous targets of between 10% and 11%. Last year, TNT’s operating profit margin in Europe was 6.1%.
TNT Express is selling its loss-making business units in China and Brazil. The company faces intense international competition from global rivals FedEx (NYSE:FDX), UPS (NYSE:UPS) and Deutsche Post.
In January, the European Union rejected a bid by UPS to acquire TNT Express, ruling that the purchase would constrain competition in the shipping market.
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