Deutsche Post DHL profits surpass €2bn in 2013
Deutsche Post DHL said today that its profits climbed “sharply” in 2013 to more than EUR 2bn. As a result, the company is proposing to raise the expected dividend by 14% compared to 2012, to EUR 0.80 per share.
The German postal and logistics giant reported its full year results today revealing that revenues actually declined slightly, by less than a point to EUR 55.1bn.
Adjusted for currency movement and a range of one-off costs, revenue would have risen by nearly 3%.
Results for the year were helped by higher postal rates and rising parcel volumes within Germany, as well as strong growth in the DHL Express and Supply Chain businesses.
Net profit for the year reached EUR 2.1bn, up more than EUR 450m compared to 2012.
Deutsche Post DHL chief executive Frank Appel said today that his company had taken a “significant” step forward in 2013.
He said: “We built upon our existing strengths, affirmed our strong market position and significantly improved the company in all aspects of our Strategy 2015. We will nevertheless continue to work hard to reach our 2015 goals given the continued sluggish global economic environment.”
Deutsche Post said it expected its pre-tax earnings to grow from the EUR 2.86bn recorded in 2013 to between EUR 2.9bn and EUR 3.1bn in 2014 despite the “sluggish” global economy. Company forecasts suggested a generally stable mail division with growth generated by the DHL divisions.
With some cost-cutting at headquarters, the company is anticipating continued growth into 2015, with EBIT set to rise to between EUR 3.35bn and EUR 3.55bn in that year.
Proposals to pay out a 14% bigger dividend as a result of Deutsche Post’s profit jump would mean paying out EUR 967m to shareholders, the company said today, or 49% of net profits.
Results
Deutsche Post DHL’s fourth quarter saw a slight dip in revenues compared to the year before’s final quarter, although adjusted revenues grew more than 4% year-on-year. The quarter was the most profitable of the year for the company, however, with operating earnings up 7% year-on-year in the group, to EUR 885m, led by a double-digit earnings growth at DHL.
Among the divisions, the Mail division saw its revenues grow by 3.4% in 2013, to EUR 14.5bn. Deutsche Post revealed that its digital mail service E-Post contributed about EUR 100m to this. The rest of the growth came from higher postal rates and “robust” performance in the German parcels business thanks to e-commerce. Operating earnings in the Mail division grew 17% to EUR 1.2bn, although growth levels were affected by one-off financial impacts like the VAT charge imposed in 2012.
The DHL Express division saw its revenue decrease slightly in 2013 to EUR 12.7bn, following the company’s sale of domestic businesses in Australia, New Zealand and Romania. Adjusted for these effects, revenue would have risen by more than 4%. Pre-tax earnings in the express division rose by more than 2% to EUR 1.1bn, though again comparisons are distorted by one-off impacts.
DHL Global Forwarding and Supply Chain saw revenues down 5.3% to EUR 14.8bn, and adjusting for currency the decrease would still have been more than 2%. The company reported weakening demand from several large customers in the technology, engineering and manufacturing sectors, and lower demand in the Americas and European regions. There was increased demand for services in the intra-Asian and north-south routes, and a small rise in revenues from road transport in continental Europe. Pre-tax earnings fell 6% to EUR 483m.
DHL Supply Chain saw its revenues falling slightly to EUR 14.3bn in 2013, though adjusted revenues taking account of the disposal of three subsidiaries would have seen growth of nearly 6%. The division saw strong growth in the Asia-Pacific region and in life sciences, healthcare, automotive, consumer and technology sectors. Pre-tax earnings climbed by 5.3% to EUR 441m.
