05-05-2009 After a year of performance and anticipation, Heppner is embarking upon 2009 with caution but confidence

At a time when the global economic crisis is weakening transport companies, Heppner, the leading independent transport and logistics company in France, presents a positive 2008 earnings statement with a 3.3% rise in turnover compared to 2007, a two-fold increase in operating profit (+120% YOY) and an appreciable improvement in net earnings (+31.8% YOY) despite the effects of this crisis that started to take its toll in mid 2008. 

Back in 2007 Heppner announced its strategic direction leading up to 2010. In 2008 it stayed the course, never loosing site of its objectives, by successfully carrying out a preemptive strategy to develop its competences and project itself into the future with determination. Capitalizing on its strong points – complementary vocations (allowing to propose a comprehensive offer), diversity of client portfolio as well as a low debt load and a healthy cash flow – Heppner is mobilizing to consolidate its position among the principal players in transport and logistics.
 
With the presentation of its revised transport plan, its repackaged and restructured new comprehensive offer of services and its sustainable development policy all announced early 2009, Heppner is tacking 2009 indeed with caution, but also with confidence thanks to its solid footing and capacity to resist the economic turbulence rocking the market. 

2008 key figures in progression 

• Consolidated turnover of 550 million euros (+ 3.3 %), of which: 
France transport:  €287m (52.2 % of turnover)
 - Groupage:     €212m (+3.8%)
 - Full and part loads:    €75m  (0 %)  
International transport:    €200m (36.3 % of turnover)
 - Europe ground:    €141m (+5.2 %)
 - Freight forwarding:     €59m (-0.3 %)  
Logistics:         €63m (11.5% of turnover) + 8.2 % 

• Operating profit 4.8 million euros, compared to 2.2 million euros in 2007
• Net income 3.1 million euros, compared to 2.3 million euros in 2007
• Cash flow 9.6 million euros
• Debt ratio of shareholders’ equity 15%
• Total employees 3,300
• Direct and indirect investments of around 12.2 million euros

Within an adverse economic context, the consolidation of Transport activities in France continues  

Considering France Transport to be the real foundation underpinning the development of high value-added activities, both for International transport and logistics, in 2008 Heppner investigated new ways how to optimize its network.
 
France Groupage: measures that paid off… 
Heppner posted an increase of 3.8%, which constitutes an impressive performance given the recession in the transport market at the end of 2008. The reorganization measures Heppner undertook at the end of the integration phase of its network (XP France, Sodimaine…) allowed to lay the groundwork in order to optimize productivity, while providing the stamina needed to confront the first side effects of the crisis. The overhaul of the transport plan in early 2009 is one of the most spectacular consequences. Heppner is pursuing these efforts and setting in motion all possible means to increase the profitability of this activity, a victim of the economic context as witnessed by both the decrease in volumes and strong deflationary pressure on prices. 

Full and part loads: positive results in 2008 
Despite the slowdown in demand and the surplus of transport capacity in the market, Heppner finished 2008 with the same turnover as in 2007. This activity thus remains an important source of value creation and profitability for the company. 

International transport and Logistics confirm their roles and contribution as the principal growth drivers 

International: in clear progression
In International transport, Europe ground posted strong growth of +9.7% in the first half of 2008, finishing at +5.2% at fiscal year end. Freight forwarding posted flat growth, explained by the collapse of freight rates but achieved an 11.1% increase in gross margin. 

International transport’s contribution to the consolidated turnover rose again in 2008 to reach 36.3%. 

Heppner solidified its foothold in Southern Europe, in particular with the signing of two new alliances in Greece and in Turkey, thus pursing the realignment of activity already begun in 2007. Meanwhile, the group continued to bolster its Europe ground transport teams inside the network, specifically at the Rouen, Rungis, Saint Etienne, Forbach and Grenoble agencies. 

One of the pillars of « System Alliance Europe », Heppner greatly contributed to optimizing the network and actively participated in projects (setting up gateways, joint clearing systems) aimed at consolidating the leadership position acquired by this network in Europe even further. 

In freight forwarding, Heppner deployed commercial delegates to countries holding promising market potential (North America, South Africa, Asia and Oceania…). Today Heppner is reaping the first real fruits of this endeavor. At the same time, much effort was put into restructuring the offer to reinforce the efficiency of the teams specialized in freight forwarding located throughout the French territory. 

This measure to reinforce competences reflects Heppner’s desire to bring value added to its offer and spur the development of its international activity. 

Logistics: consolidation of the client portfolio 
This activity posted an 8.2% increase in 2008. 

2008 was the year to consolidate the client portfolio Heppner built up in 2007 after opening six new sites in the large logistics activity clusters at Châtres (77), Gonesse (95), Tigery (91), Houplines (Lille region), Toussieu (Lyon region) and Le Havre. Today Heppner is in measure to provide its clients with 180,000 sq m of logistics warehousing space. 

In terms of construction, Heppner invested €10mn in the building of a new 17,000 sq m logistics site at Grenay (Lyon) scheduled be open next May. It is a SEVESO classified site, compliant with the most recent and strict environmental norms. 

More than ever quality remains at the heart of the strategy 

In light of the upheavals that have impacted all players in the transport and logistics sector, Heppner is making every effort to maintain a high level of quality and to render performance more transparent for its clients.  At a time when many companies have lost their bearings, Heppner considers quality to be a key component for reassuring clients. It is what differentiates Heppner from the others and builds loyalty. 

Large-scale projects to better anticipate and cope with the future 

Looking resolutely toward the future, in 2008 Heppner continued to develop many projects, some of which were implemented early 2009.  

At the top of the list is the restructuring and repackaging of its offer, in order to both enrich it and make it clearer to comprehend. The commercial tools and supports, all of which were entirely updated (new structure of the offer, new rates list, etc), have been available to existing and prospective clients since the beginning of April 2009. 

Heppner also took steps to obtain the “Authorized Economic Operator” status. The application for the full grade (customs and security/safety AEO) was submitted early April 2009. 

"Despite the current economic context making it unquestionably difficult to predict what the future holds in store, we are confident and serene about our future, comforted by the quality of our offer, the complementary aspect of our vocations, our solid financial balance sheet, our corporate culture and our capacity to anticipate. Our human values, our teams and respective competences, remain our indisputable assets. The measures that we took in 2008 and formalized in 2009 (notably our new transport plan and the rollout of our new comprehensive offer of services) should enable us to weather this critical period safely while at the same time continue to guarantee our clients an optimal and quality service,” commented Jean Schmitt, CEO and Gilles Moutel, Managing Director of Heppner.