DPWN sees profits fall in first quarter
Deutsche Post World Net has released details of its performance in the first quarter of 2004. Overall revenues rose by 7.8% to €10.5bn compared with €9.8bn in the same quarter in 2003. However operating profits fell by 2.2% to €930m from €951m. The company put this down to falling business revenues in its Mail division and costs of integration in its Express division.
Revenues from the Mail division were largely unchanged over the year before at €3.3bn with operating profits falling by 6.1% to €749m. During the quarter the company expanded its international mail operations by acquiring UK operator Speedmail and winning a licence to operate in the UK market. It also acquired two mail companies in the US.
Express
Revenues leapt in the Express division by 25.6% to €4.3bn with operating profits rising by 17.1% to €41m. The increase in revenues was largely driven by the acquisition of Airborne Express in the US. The integration process associated with this acquisition had a negative impact on profits of €49m and the Americas region as a whole made a loss of €147m. In the rest of the world the operating margin was 5.9%.
Logistics
Sales and profits grew strongly in the Logistics division. Revenue increased by 10.8% to €1.5bn and operating profit increased by 43.9% to €59m. Within the division revenue for Solutions (contract logistics) increased by 1.9% to €427m. The high tech/electronics and the consumer goods sectors grew most strongly although there were falls for automotive, textiles and pharma/healthcare. DHL Danzas Air & Ocean, the group’s forwarding business, recorded strong growth of 14.9% to €1,120m largely as a result of growth in air and sea freight volumes.
Deutsche Post’s STAR integration programme continued to deliver results with management claiming that it contributed €81m to earnings in the first quarter. In total the programme has created savings of €504m since the programme’s introduction with the ultimate goal of achieving €700m by the end of 2004.
