Deutsche Post performance criticised
Major institutional investors are accusing German national postal services provider Deutsche Post of poor operating results, poor profit growth and a lack of clarity. Klaus Kaldemorgen, head of German investment fund DWS Investment, which holds a 1.8 per cent stake in the company, fears that Deutsche Post could face being broken up if it does not improve profitability quickly, as the individual divisions of the company could be worth more than the company as a whole.
Mr Kaldemorgen has said that the forecast of only a 3 per cent increase for 2007 indicates the slowness of Deutsche Post’s restructuring and integration of different areas and regions, and doubts that the company will attain its mid-term target of 5.2bn euros in 2009. Michael Gierse, head of German investment fund Union Management, which holds a 1.6 per cent stake in Deutsche Post, has criticised the company for its profit growth not being in line with turnover growth, and for operating margins not only having dropped considerably in 2006 but for falling below the margins attained in 2004 and 2003. This is being attributed to problems in German parcel business and US business, the figures of which are no longer released. Mr Gierse has also queried the annual 500m euros registered for legal, consultancy and auditing fees; a representative for Deutsche Post has said that these figures arise from major takeovers in the past.
