Deutsche Post World Net hits the ground running in 2002

Revenue rises by 13% to €9.7 billion in Q1/2002
New majority holding in DHL boosts foreign revenue to almost 40% of consolidated revenue

Deutsche Post World Net has kicked off 2002 with 13.1% growth in revenue to €9.7 billion in Q1/2002. The key reason for the rise in revenue as against the prior year period was the acquisition of a majority holding in DHL International, the global market leader for cross-border courier and express services. In line with our corporate strategy, the share of foreign revenue rose from 31% to more than 39%.

In Q1/2002, profit from operating activities (EBITA) was down 6.5% year-on-year at €785 million. This was due to the effect of the economic downturn, a trend that Deutsche Post World Net, like many other companies, was unable to escape at a global level. As expected, the net profit for the period fell to €417 million as a result of the composite tax rate in particular, which is now around 40%. Equity rose from €5.4 billion (December 31, 2001) to over €5.8 billion (+9.2%). The quality of the company's balance sheet is shown by increased equity, a continuing high equity ratio, a healthy cash flow and the other sound financial and balance sheet ratios.

Dr. Klaus Zumwinkel, Chairman of the Board of Management of Deutsche Post World Net, is quietly optimistic about business developments in Q1/2002: "Despite weaker sales and revenues as a result of the economy, we managed to increase profits in the logistics and financial services divisions. This shows that we have made sustained progress on costs. In the express division, we have taken a major step towards our goal of becoming the number one global player. Thanks to the consolidation of DHL International we have almost doubled our revenue in this division. In the mail division, revenue fell slightly and profits dropped in line with expectations. The Group as a whole also developed as we expected it to in Q1/2002 – revenue rose although there was a slight drop in quarterly earnings. We also recorded a sustained strong cash flow and continuing excellent financial and balance sheet ratios. Business developments for the rest of the Group as a whole will depend on how quickly the economy recovers in Europe, Asia and the US."

In the period under review, the Mail Corporate Division recorded a slight drop in revenue, which was down 2.1% to around €3 billion. The Mail Communication Business Division experienced a drop in demand from private customers. One reason behind this was the conversion to the euro, which led to the increased use of DM?denominated stamps acquired in the past. DM stamps will still be valid until June 30, 2002, after which only euro stamps will be valid. Profit from operating activities (EBITA) fell by 9.2% to €675 million. Deutsche Post World Net succeeded in cutting costs significantly in the Mail Corporate Division by gradually outsourcing transport services and streamlining the management structures in its branches.

In Q1/2002, the Express Corporate Division experienced a 95.4% boost in revenue from the first-time consolidation of DHL International to over €3 billion. Profit from operating activities (EBITA) of €33 million (previous year: €88 million) includes DHL International's expected losses and a positive contribution of €91 million from the other business divisions. The Euro Express Business Division recorded a slight increase in revenue, which rose to just under €1.6 billion.

Revenue for the Logistics Corporate Division fell by 7% from around €2.3 billion to around €2,2 billion. While the Solutions Business Unit was able to generate a growth in revenue of 3.5%, revenue in the Intercontinental Business Unit fell by 15.5% as a result of the difficult market situation in the wake of September 11. Despite falling revenue, we succeeded in increasing the profit from operating activities (EBITA) by 3.2% to €32 million thanks to good cost management.

Revenue in the Financial Services Corporate Division fell by 4.7% to €1.9 billion – primarily as a result of lower interest rates. However, profit from operating activities (EBITA) improved by 5.6% to €131 million.

Zumwinkel emphasized the strategic importance of the integration of DHL International with Deutsche Post World Net: "By acquiring a majority holding in DHL International, we have made a logical strategic addition to our international network, which now covers more than 220 countries, and come a good deal closer to our goal of being the number one global player in the logistics market. With more than 60,000 employees and annual revenue of around €6 billion , DHL International is a new major pillar within Deutsche Post World Net. The company is being integrated with the Group as the Worldwide Express Business Division."

Press contact:

Deutsche Post World Net
Pressestelle
Dr. Martin Dopychai
Norbert Schäfer
53250 Bonn
Phone: +49 (228) 1 82-99 88
Fax: +49 (228) 1 82-98 22
e-Mail: [email protected]