DHL boosts Deutsche Post but profits fall 22%
Deutsche Post, the German postal and logistics group, reported a 22 per cent drop in net profit for the first quarter, but gathered global strength from last year’s acquisition of express postal group, DHL International.
The group, which earlier in the month announced that it planned to buy back shares in an attempt to boost its falling share price, said it had been unable to escape the grip of the ongoing economic downturn during the first quarter ended March 31.
Net profits dropped from E539m ($485.8m) to E417m for the period, with earnings per share down 23 per cent at E0.37 from E0.48 previously.
Group sales for the quarter rose by 13 per cent to E9.70bn up from E8.58bn, as the acquisition of DHL saw the company’s share of foreign revenue rise from 31 per cent to more than 39 per cent.
Profit from operating activities (EBITA) was down 6.5 per cent year on year at E785m.
Dr Klaus Zumwinkel, chairman of the board of management of Deutsche Post World Net, said: “Despite weaker sales and revenues as a result of the economy, we managed to increase profits in the logistics and financial services divisions”.
However he sounded a note of caution on prospects for the full year. “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,” he said.
The group’s mail operations reported a drop in revenue of 2.1 per cent to E3bn, which it attributed to the conversion to the euro.
Sales in its Express division were positively impacted by the addition of DHL and rose to E2.98bn from E1.49bn previously.
The logistics division reported a 7 per cent drop in sales to around E2.2bn as its intercontinental operations foundered under market conditions in the wake of the September 11 terrorist attacks.
The group’s financial services division also saw a 4.7 per cent fall in sales to E1.9bn, mainly as a result of lower interest rates.
Shares in Tuesday morning trading rose slightly to E14.99 from E15.09, but were still well down from the year’s high of E17.48.
