Creating End-To-End Solutions
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Creating end-to-end solutions INTEGRATED MANAGEMENT REPORT 2017 panalpina.com About Panalpina CONTENTS The year in review The Panalpina Group is one of the world’s Key figures 1 leading providers of supply chain solutions. Highlights 2 The company combines its core products – Panalpina at a glance 4 Interview with the Chairman, 6 Air Freight, Ocean Freight, and Logistics CEO and CFO Our history 10 and Manufacturing – to deliver globally Our brand 11 integrated, tailor-made end-to-end solutions Vision, mission and values 12 for eleven core industries. Drawing on Products and industries 13 Five-year review 14 in-depth industry know-how and customized Information for investors 16 IT systems, Panalpina manages the needs Strategic overview Panalpina strategy 18 of its customers’ supply chains, no matter Delivery on our strategy 19 how demanding they might be. Energy and Integrated business model 20 Impacts and governance 21 Project Solutions is a specialized service of material topics for the energy and capital projects industry. Managing material topics 23 Stakeholders 28 Risk management 29 An integrated view The Panalpina Group operates a global of the business network with 500 offices in around Products 30 Regions 34 70 countries, and it works with partner Customers 38 companies in another 100 countries. Industry verticals 39 Panalpina employs approximately Information technology 43 Security 44 14,000 people worldwide who deliver People and sustainability a comprehensive service to the highest People and HR 45 Health and safety 48 quality standards – wherever and whenever. Community 50 Ethics and compliance 51 Quality 52 Environment 54 Corporate governance report 58 Compensation report 67 GRI standards 73 content index Panalpina Integrated Management Report 2017 ThePanalpina year in Integrated review Management Report 2017 panalpina.com 11 Key figures Net forwarding revenue Gross profit by product Gross profit by region Million CHF Million CHF Million CHF Air Freight • Europe • AirAir Freight • 639 Air Freight Europe530.3 530 2,919.82,920 Ocean639.4 Freight •A Americasmericas429 427 • OceanOcean Freight • Ocean Freight A428.9PAC 349 Logistics 2,074.22,074 427.2 •MEAC APAC • Logistics • 331 Logistics 348.8 90 Logistics 538.7539 331.1 • MEAC 89.7 Tons air freight transported (in ‘000) TEUs ocean freight transported (in ‘000) 2013 825 2013 1,495 2014 858 2014 1,607 5,533 2015 836 2015 1,594 NFR in million CHF 2016 921 2016 1,488 2017 996 2017 1,520 5% 7% 9% Reduction in total greenhouse gas emissions Reduction in total energy use Reduction in paper use compared to 2016 compared to 2016 compared to 2016 Panalpina Integrated Management Report 2017 The year in review panalpina.com 2 Highlights Panalpina expands Perishables Network Panalpina launched the global Perishables Network with a focus on 15 key countries and an ambitious plan to double that number by 2020. The network expanded through acquisitions of four companies specializing in perishables logistics—Air Connection in Kenya, Interfresh in the Netherlands, Cool Chain Group in Germany, and Adelantex and AD Handling in Belgium— strengthening Panalpina’s ability to offer complete, end-to-end solutions for customers in both origin and destination countries. Read more on page 41 (Perishables) Innovative customer portal is piloted in Air Freight Panalpina successfully piloted its new, fully automated online quotation and booking platform for ad hoc cargo with selected Air Freight customers. This new centralized digital platform will provide customers with a fast, simple and reliable online interface that enables informed decision-making by giving access to easy and instantaneous quotation and booking of ad hoc shipments globally. Read more at http://panalpina.mynewsdesk.com/news/panalpina- announces-launch-of-highly-innovative-and-industry-shaping- customer-portal-261148 Panalpina introduces Panprojects Carrier solution for heavy-lift cargo With this new carrier model Panalpina can oversee multimodal heavy-lift moves from fabrication to installation sites under one single contract that clearly governs all modes of transport. For customers like EPC (engineering, procurement and construction) companies and oil and gas majors, this offering with its unique legal framework reduces to an absolute minimum the commercial, technical and contractual risks that are inherent to the multimodal transport of project cargo. Read more at http://panalpina.mynewsdesk.com/pressreleases/multimodal- heavy-lift-moves-panalpina-offers-hassle-free-carrier-solution-2121044 Panalpina Integrated Management Report 2017 The year in review panalpina.com 3 Highlights continued EcoVadis awards Panalpina with gold rating for sustainability Panalpina received the highest rating from EcoVadis, an independent platform that invites companies to assess the environmental and social performance of their business partners. Panalpina was also recognized as being in the top 1% of those in the industry, and the top 2% of all 30,000 companies being assessed by EcoVadis on corporate social responsibility requirements. Read more on page 56 (Environment) SAP TM implemented in Germany Germany became the first large country where Panalpina implemented the new transportation management system, SAP TM, which will improve the company’s productivity and agility. With this successful rollout in Air and Ocean Freight, Panalpina demonstrated that the system is stable and scalable. Read more on page 43 (Information Technology) Panalpina strengthens Global Supply Chain Solutions offering Panalpina centralized its Supply Chain Solutions offering with plans to expand the existing team of experts and further invest in technology and infrastructure. Panalpina’s customers from across multiple industries will benefit from solutions that manage their supply chains from end to end and offer greater flexibility, customization, and visibility. Read more at http://panalpina.mynewsdesk.com/pressreleases/panalpina- centralizes-and-expands-global-supply-chain-solutions-offering-2330637 Panalpina Integrated Management Report 2017 The year in review panalpina.com 4 Panalpina at a glance Headquartered in Basel, Switzerland, Panalpina is organized into four regions covering six continents. CORPORATE EUROPE ASIA PACIFIC 449 4,574 3,897 AMERICAS MIDDLE EAST, AFRICA AND CIS 3,870 1,261 Panalpina Integrated Management Report 2017 The year in review panalpina.com 5 Panalpina at a glance continued OPERATIONAL HIGHLIGHTS Panalpina’s employees represent 120 nationalities, working in close collaboration in global teams to develop and implement end-to-end solutions that benefit their customers’ supply chains. Reduced consumption 18 bronze and 4 silver of electricity, heating LogEx certificates and paper awarded in 2017 Read more on page 57 Read more on page 32 Employees participated ERP Single Client in 400 activities for implemented in Global Sustainable 47 countries Action Week Read more on page 19 70 Read more on page 50 countries 500 2 30,000 m warehouse Fifth consecutive yearly offices worldwide under construction charter flight to an African in Singapore country for UNICEF 14,000 Read more on page 35 Read more on page 50 full-time equivalents (FTEs) worldwide 72% facilities covered by JDA unified warehouse management system 30 GDP certified warehouses specializing in pharmaceutical products 1st logistics company to join European Remanufacturing Council Panalpina Integrated Management Report 2017 The year in review panalpina.com 6 Interview with the Chairman, CEO and CFO Interview with Peter Ulber, Chairman of the Board of Directors; Stefan Karlen, President and Chief Executive Officer; and Robert Erni, Chief Financial Officer Panalpina will reach a major 995,900 milestone in 2018 by demonstrating tons air freight transported that the CHF 200 million investment in a new technology platform is headed 1,520,500 for success. TEUs ocean freight transported This will position the company among the top players to shape the future of our industry. Peter Ulber Chairman of the Board of Directors What were the highlights of 2017 for Panalpina? Peter Ulber: Our strategy is to place Panalpina amongst the top global logistics providers, and be in a position where we have every option to play an active role in the further anticipated consolidation of the logistics industry. We have achieved organizational stability, maintained financial strength and now built a scalable IT landscape to be even more competitive. Panalpina will reach a major milestone in 2018 by demonstrating that the CHF 200 million investment in a new technology platform is headed for success. This will position the company among the top players to shape the future of our industry. Panalpina Integrated Management Report 2017 The year in review panalpina.com 7 Interview with the Chairman, CEO and CFO continued In 2017, Air Freight reached new heights We rolled out our new transportation by transporting close to one million tons, management system for Air Freight the highest in our company’s history. and Ocean Freight in Germany, Stefan Karlen demonstrating that it can be implemented President and Chief Executive Officer successfully in a large country. Robert Erni Chief Financial Officer Stefan Karlen: In 2017, Air Freight reached new heights by Digitalization is one of the primary drivers in our industry, and transporting close to one million tons, the highest in our we see that as an opportunity to offer better, more transparent company’s history. Both profitability and EBIT for Air Freight services