TNT said third-quarter earnings before interest and tax (EBIT) rose to 246 million euros ($298.6 million) from 241 million a year earlier, falling short of the 252 million euros average forecast in a Reuters poll of 12 analysts.
Revenue rose 8.6 percent to 3.23 billion euros, broadly in line with analysts' expectations of 3.29 billion euros, buoyed by the express division, which competes with Deutsche Post's DHL as well as FedEx and UPS.
TNT also announced a strategic partnership with Japan Post, Japan's internal mail delivery group, with the aim of establishing a joint express operation between Japan and the rest of the world by the second quarter of 2006. By 2007, the two firms also plan joint logistics activities.
"As soon as the privatisation of Japan Post is finalised, we will see what we can do next," Chief Executive Peter Bakker told a news conference. "This alliance has the potential to achieve a leading position in the Asia-Pacific express market."
Analysts said the results of TNT's mail division, whose operating profit rose 2.1 percent, where in line with expectations, and the express division had again posted good results with a 37-percent rise in EBIT.
TNT shares gained 0.6 percent to 19.51 euros by 1049 GMT. The shares have fallen about 3 percent this year, underperforming German rival Deutsche Post by about 10 percent.
Results in TNT's logistics division, which manages supply chains, were hurt by 8 million euros in restructuring costs for its French business, part of a 140 million euros pretax charge the firm expects to take for the sale of loss-making French logistics activities.
TNT said it expected to take most of the charge in the fourth quarter. TNT announced earlier this month that it had received offers for most the French activities it plans to sell.
"In the rest of Logistics, partly resulting from an unexpected law change in Italy, margin pressure remained, although we did see some positive signs in business development," Bakker said.
WestLB analyst Tue Ostergaard said the margin pressure reflected a general trend in the logistics market.
The logistics division generated 34 percent of TNT's third-quarter revenue, but only 5 percent of operating profit.
TNT said it was too early to give details on the expected financial impact of an investigation into tax irregularities at subsidiaries that the group revealed last month.
Net profit increased to 148 million euros from 147 million a year ago. Analysts had forecast 151 million. TNT's express division improved its operating margin to 7.8 percent from 6.2 percent a year ago, looking on track for its operating margin target of 10 percent in 2007.
TNT said it expected the division to deliver an operating margin of 9 percent for the full year, compared with a previous guidance of 8.5 to 9 percent.