Strong Q1 for all divisions at Deutsche Post DHL Group

posted on 9th May 2018 by Justin Burns

Deutsche Post DHL Group continued its positive business performance in the first quarter (Q1) of 2018 recording operating profit of €4.15 billion with all divisions contributing to the strong showing.

Reported Group revenue was €14.7 billion and with this almost on the level of the prior year (2017: €14.9 billion). The slight decline was mainly attributable to negative currency effects and the sale of the subsidiary Williams Lea Tag.

On an organic basis – after adjusting for currency and portfolio effects – Deutsche Post DHL Group increased Group revenue by a substantial 6.4 per cent. Operating profit (EBIT) rose by 2.3 per cent to €905 million.

DHL said the international Express business continued to see particularly dynamic growth during Q1 along with the Global Forwarding, Freight division and Post- eCommerce – Parcel sector.

Revenue in the Post – eCommerce – Parcel division increased by 1.7 per cent to €4.6 billion in the first quarter. The division’s positive performance was primarily attributable to growth in revenue in the eCommerce – Parcel business unit.

In Q1, the Express  division again continued the very good revenue and earnings performance sustained over several years. Revenue rose by 4.9 per cent on the prior year to €3.8 billion. Adjusted for currency effects, the increase was 13.2 per cent.

This dynamic performance was once again driven by strong growth in the international time-definite (TDI) delivery business, where daily volumes rose by 9.6 per cent compared with the prior-year period.

Sustained growth in volumes DHL said will enable the division to “utilise its unique global express network even more efficiently”. The division succeeded in growing operating profit by 16.4 per cent to €461 million on the back of strict yield management and continuous improvements in the network. The operating margin improved to 12.2 per cent, up substantially from the 11 per cent reported a year earlier.

The Global Forwarding, Freight division continued its turnaround in Q1. Revenue increased by 1.3 per cent to €3.6 billion, adjusted for negative currency effects the improvement was even 7.2 per cent.

The integrator said the division was increasingly able to pass on higher freight market rates to its customers. At the same time, the additional measures introduced to raise profitability are proving effective. The division’s EBIT therefore increased by a considerable 75 per cent to €70 million.

Deutsche Post DHL Group chief executive officer, Frank Appel said: “Overall, we had a good start to the year, although we still have a lot of work ahead of us during the remainder of the year.

“Global e-commerce continues to boom, meaning that the most important growth driver for our businesses is still intact. We remain confident that we will achieve our ambitious goals for 2018 and beyond.”

After an overall good Q1 the company continues to project an increase in operating profit to around €4.15 billion for full-year 2018.