Status Report

Investments and Depreciation

 

Property, plant and equipment

The Group continues to operate an asset-light business model and invests only into strategically important locations with high demand for state of the art or industry-specific logistics space.

In 2019, the Kuehne+Nagel Group invested a total of CHF 320 million (2018: CHF 315 million) in fixed assets. Investments in properties and buildings amounted to CHF 86 million (2018: CHF 64 million), of which the most substantial amount into a new large-scale pharma logistics facility in Moehlin, Switzerland, into the construction of a new office building in Bremen, Germany, and into the extension of the Logistics Hub in Haiger, Germany. CHF 234 million (2018: CHF 251 million) were invested in other fixed assets, operating and office equipment. Depreciation of property, plant and equipment for the year 2019 amounted to CHF 206 million (2018: CHF 192 million). Refer to note 26 of the Consolidated Financial Statements for further details.

All capital expenditure in 2019 was financed through operational cash flow.

In 2019, the following major investments were made in properties and buildings:

Location CHF million Centres
Bremen, Germany 12 Construction of a new building and logistics facilities
Haiger, Germany 16 Expansion and construction of logistics facilities
Auckland, New Zealand 10 Construction o an airfreight perishable facility
Moehlin, Switzerland 9 Construction of a large-scale pharma logistics facility
Geel, Belgium 4 Expansion of a logistics facility
Others 35  
Total Group86  

The allocation of investments in other fixed assets, operating and office equipment by category is as follows:

CHF million 2019 2018
Operating equipment 80 81
Vehicles 26 28
Leasehold improvements 70 86
IT hardware 43 39
Office furniture and equipment 15 17
Total Group234 251

The allocation by region is as follows:

CHF million 2019 2018
EMEA 146 153
Americas 52 70
Asia-Pacific 36 28
Total Group234 251

The allocation by business unit is as follows:

CHF million 2019 2018
Seafreight 20 28
Airfreight 22 23
Overland 31 36
Contract Logistics 161 164
Total Group234 251

Right-of-use assets

A total of CHF 688 million was invested in right-of-use assets. The allocation of investments in right-of-use assets is as follows:

CHF million 2019
Buildings 599
Operating equipment 36
Vehicles 53
Total Group688

The allocation by region is as follows:

CHF million 2019
EMEA 422
Americas 195
Asia-Pacific 71
Total Group688

The allocation by business unit is as follows:

CHF million 2019
Seafreight 19
Airfreight 21
Overland 35
Contract Logistics 613
Total Group688

Depreciation of right-of-use assets amounted to CHF 497 million. Refer to note 27 of the Consolidated Financial Statements for further details.


Acquisitions

Effective January 1, 2019, the Group acquired 51 per cent of the shares of KN-Sincero Logistics Co. Ltd. (formerly Shanghai Ruichun Logistics Co., Ltd.), China, a new company established to conduct the business of the partnership with Sincero, a Chinese automotive logistics group, to focus on contract logistics business for the automotive sector. With more than 800 employees, it operates close to 120,000 sqm of logistics space in Central, Southern and Western China and generates annual revenues of approximately CHF 60 million.

Effective July 1, 2019, the Group acquired the business of Worldwide Perishables Canada Co., specialised in seafood logistics. With a strong footprint on the East Coast, the business will strengthen the existing Kuehne+Nagel perishables network in Canada.

Effective September 10, 2019, the Group acquired 100 per cent of the shares of Joebstl Group, a medium-sized logistics group of companies headquartered in Wundschuh, Austria. The Joebstl Group offers international and domestic groupage, and full-truckload and less-than-truckload services mainly in Eastern Europe to customers in Austria and Slovenia.

Other intangibles of CHF 26 million recognised on the acquisitions represent contractual and non-contractual customer lists.

Goodwill of CHF 75 million arose on the acquisitions and represents management expertise and workforce which do not meet the definition of an intangible asset to be recognised separately.