German Deutsche Post to strengthen logistics division
German postal services company Deutsche Post AG seeks for acquisitions in the Asian and American region in line with the strategy to strengthen its logistics business, Frank Appel, member of the management board, said on April 12, 2005.
Deutsche Post’s DHL Danzas Air & Ocean unit in the Asia-Pacific region and German logistics company DHL Solutions are the two subsidies to profit the most from the expansion strategy. Deutsche Post aims to be market leader in air and marine cargo freight as well as to be among the top 3 in contract logistics.
The group’s logistics business reported a 15.4 pct year-on-year increase in sales to 6.8 bln euro ($8.79 bln) in 2004. Danzas generated some 4.9 bln euro ($6.33 bln) of them while DHL Solutions sales accounted for 1.8 bln euro ($2.33 bln). The earnings before interest and tax (EBIT) rose to 281 mln euro ($363.1 mln), compared to 206 mln euro ($266.2 mln) in 2003.
DHL already holds the lead in air freight but stands behind German rival Kuehne&Nagel when it comes to marine cargo. The company is the fourth largest player on the contract logistics market with little more than 1.0 pct market share. This market is dominated by UK company Exel with some 2.7 pct. Exel is seen as a suitable takeover target for rivals UPS, Fedex and Deutsche Post.
According to Appel, DHL plans to grow organically and acquire companies in Asia and America.
International express delivery provider DHL Express Wordwide currently builds a package centre in Bremen, northern Germany, which will require some 100 mln euro ($129.2 mln) investments and will create 400 new jobs. DHL Express generated a 17.7 bln euro ($22.87 bln) turnover in 2004 with 367 mln euro ($474.2 mln) earnings before interest, tax and amortisation (EBITA).
