08.05.2018
Deutsche Post AG DE0005552004
Deutsche Post AG: Deutsche Post DHL Group confirms earnings targets for 2018
DGAP-Media / 08.05.2018 / 07:00
Deutsche Post DHL Group confirms earnings targets for 2018
- First-quarter Group revenue at prior-year level, 6.4% organic growth
- Operating profit increases to EUR 905 million
- 2018 Forecast confirmed: EBIT set to increase to approximately EUR 4.15
billion, with more than EUR 5 billion targeted for 2020
- CEO Frank Appel: "Overall we had a good start into the year, although we
still have a lot of work ahead of us for the remainder of 2018"
Bonn/London, May 8, 2018: Deutsche Post DHL Group, the world's leading mail
and logistics company, continued its positive business performance of
previous years also in the first quarter of 2018. Reported Group revenue was
EUR 14.7 billion and with this almost on the level of the prior year (2017:
EUR 14.9 billion). The slight decline was mainly attributable to negative
currency effects and the sale of the subsidiary Williams Lea Tag. On an
organic basis - after adjusting for currency and portfolio effects -
Deutsche Post DHL Group increased Group revenue by a substantial 6.4%.
Operating profit (EBIT) rose by 2.3% to EUR 905 million. This figure
includes a positive EBIT effect of EUR 44 million resulting from the
transition to the new IFRS 16 accounting standard, which has been applied
since the beginning of the year as previously announced. In addition, EBIT
includes a positive effect of 108 million EUR resulting from pension
revaluations. These positive EBIT-effects were offset by negative one-offs
of EUR 50 million in the Supply Chain division. The international Express
business continued to see particularly dynamic growth during the first
quarter.
"Overall, we had a good start to the year, although we still have a lot of
work ahead of us during the remainder of the year. Global e-commerce
continues to boom, meaning that the most important growth driver for our
businesses is still intact. We remain confident that we will achieve our
ambitious goals for 2018 and beyond," said Frank Appel, CEO of Deutsche Post
DHL Group.
Outlook: Medium- and long-term earnings targets confirmed
After an overall good first quarter, the company continues to project an
increase in operating profit to around EUR 4.15 billion for full-year 2018.
The improvement includes approximately EUR 150 million expected as a result
of the transition to IFRS 16. The Post - eCommerce - Parcel (PeP) division
is expected to generate EBIT of around EUR 1.5 billion. An EBIT of around
EUR 3.0 billion is anticipated from the DHL divisions. As announced before,
the company plans to increase EBIT to more than EUR 5 billion by the 2020.
Continued high investments in sustainable growth
To achieve the above targets, Deutsche Post DHL Group again made targeted
investments during the first quarter to further strengthen its foundation
for long-term profitable growth. The company invested a total of EUR 327
million across all four divisions between January and March (2017: EUR 334
million). Investments focused among others on expanding the domestic and
international parcel infrastructure, stepping up production of the
StreetScooter electric vehicles and modernizing and expanding the hubs and
aircraft fleet used by DHL Express. For full-year 2018, the Group continues
to project an increase of capital expenditure to approximately EUR 2.5
billion (2017: EUR 2.3 billion). In addition, the Group will recognize
around EUR 200 million for the debt-financed intercontinental fleet renewal
at Express.
First quarter sees customary seasonal cash outflow
The Group's free cash flow came to a negative EUR 679 million in the first
quarter (2017: EUR -430 million). The significant cash outflow in the first
quarter reflects the usual seasonal trend for Deutsche Post DHL Group. At
the beginning of each year the company's cash flow is regularly impacted by
the annual prepayment made to the Federal Post and Telecommunications Agency
for civil servant pensions. The contribution for 2018 was EUR 462 million.
The year-on-year reduction in free cash flow was due to higher capital
expenditure and cash outflows from working capital, among other factors.
All in all, Deutsche Post DHL Group generated consolidated net profit of EUR
600 million after non-controlling interests in the first quarter of 2018
(2017: EUR 633 million). The decline results from the transition to IFRS 16.
Basic earnings per share thus amounted to EUR 0.49 (2017: EUR 0.52).
PeP: German and international parcel business continues to grow
Revenue in the Post - eCommerce - Parcel division increased by 1.7% to EUR
4.6 billion in the first quarter. The division's positive performance was
primarily attributable to growth in revenue in the eCommerce - Parcel
business unit.
Revenue increased by 6.3% at Parcel Germany, 9.9% at Parcel Europe and 2.6%
at eCommerce, where - after adjusting for currency effects - revenue even
rose by 16.8%. This trend is another reflection of the Group's successful
positioning as a market and innovation leader in the dynamically growing
e-commerce market, both in Germany and, to an increasing extent,
internationally. The company is further expanding its stance by introducing
offers such as its new global e-commerce fulfillment solution for worldwide
order management.
In the Post business unit, revenue decreased by 1.5% year on year to EUR 2.5
billion. The slight decrease was mainly due to the known structural volume
declines.
In the PeP division, operating profit fell by 9.9% compared with the
prior-year period to EUR 383 million in the first quarter. The decrease
primarily reflects higher costs and capital expenditure, which are partly
related to the growth of the business. In Germany, staff and transport costs
both increased, while StreetScooter production and the international parcel
business were expanded. The division's EBIT includes a positive effect of
108 million Euro from pension revaluations.
Express: Success story continues
In the first quarter, the Express division again continued the very good
revenue and earnings performance sustained over several years. Revenue rose
by 4.9% on the prior year to EUR 3.8 billion. Adjusted for currency effects,
the increase was 13.2%. This dynamic performance was once again driven by
strong growth in the international time-definite (TDI) delivery business,
where daily volumes rose by 9.6% compared with the prior-year period.
Sustained growth in volumes will enable the division to utilize its unique
global express network even more efficiently. The division succeeded in
growing operating profit by 16.4% to EUR 461 million on the back of strict
yield management and continuous improvements in the network. The operating
margin improved to 12.2%, up substantially from the 11.0% reported a year
earlier.
Global Forwarding, Freight: Significant improvement in profitability
The Global Forwarding, Freight division continued its turnaround in the
first quarter. Revenue increased by 1.3% to EUR 3.6 billion, adjusted for
negative currency effects the improvement was even 7.2%.
The division was increasingly able to pass on higher freight market rates to
its customers. At the same time, the additional measures introduced to raise
profitability are proving effective. The division's EBIT therefore increased
by a considerable 75.0% to EUR 70 million.
Supply Chain: Revenue and earnings impacted by one-time effects
Revenue in the Supply Chain division came in at EUR 3.1 billion in the first
quarter (2017: EUR 3.5 billion). In addition to negative currency effects,
the revenue decline mainly reflects the sale of UK subsidiary Williams Lea
Tag in the fourth quarter of 2017. After adjusting for those factors, the
division's revenue increased by 3.8%. DHL Supply Chain continued to generate
new business, concluding additional contracts in a total volume of EUR 175
million with both new and existing customers during the first quarter.
Operating profit declined to EUR 55 million (2017: EUR 99 million). The
decrease seen here was also largely due to one-time effects. In addition to
the deconsolidation of Williams Lea Tag, the operating profit reflects
negative one-off effects of EUR 50 million from customer contracts.
- End -
Note to editors: An interview with CFO Melanie Kreis is available at
www.dpdhl.com. The Group's Capital Markets Day in London will be streamed
from 10 a.m. on our website.
Media contact
Deutsche Post DHL Group
Media Relations
Christina Neuffer
Phone.: +49 228 182-9944 [IMAGE]
E-mail: [email protected]
On the Internet: www.dpdhl.com/press
Follow us: www.twitter.com/DeutschePostDHL
Deutsche Post DHL Group is the world's leading mail and logistics company.
The Group connects people and markets and is an enabler of global trade. It
aspires to be the first choice for customers, employees and investors
worldwide. The Group contributes to the world through responsible business
practice, corporate citizenship and environmental activities. By the year
2050, Deutsche Post DHL Group aims to achieve zero emissions logistics.
Deutsche Post DHL Group is home to two strong brands: Deutsche Post is
Europe's leading postal service provider. DHL offers a comprehensive range
of international express, freight transport, and supply chain management
services, as well as e-commerce logistics solutions. Deutsche Post DHL Group
employs approximately 520,000 people in over 220 countries and territories
worldwide. The Group generated revenues of more than 60 billion Euros in
2017.
Die Post für Deutschland. The logistics company for the world.
Group financial highlights for the first quarter of 2018
in EUR millions Q1 Q1 Change
2017 2018 in %
Revenue 14,883 14,749 -0.9
- of which international 10,309 10,051 -2.5
Profit from operating activities (EBIT) 885 905 2.3
Consolidated net profit1) 633 600 -5.2
Basic earnings per share (in EUR) 0.52 0.49 -5.8
Diluted earnings per share (in EUR) 0.51 0.48 -5.9
Divisional revenues in the first quarter of 2018
in EUR millions Q1 Share of total Q1 Share of total Chang-
2017 revenues in % 2018 revenues in % e in
%
Post - 4,545 30.5 4,622 31.3 1.7
eCommerce -
Parcel
Express 3,595 24.2 3,772 25.6 4.9
Global 3,546 23.8 3,591 24.3 1.3
Forwarding,
Freight
Supply Chain 3,523 23.7 3,124 21.2 -11.3
Corporate -326 n.a. -360 n.a. -10.4
Center/Other
and
consolidation
Group 14,883 100.0 14,749 100.0 -0.9
Divisional EBIT in the first quarter of 2018
in EUR millions Q1 Q1 Change
2017 2018 in %
Post - eCommerce - Parcel 425 383 -9.9
DHL 534 586 9.7
- Express 396 461 16.4
- Global Forwarding, Freight 40 70 75.0
- Supply Chain 99 55 -44.4
Corporate Center/Other and -75 -64 14.7
consolidation
Group 885 905 2.3
1) After non-controlling interests
End of Media Release
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Issuer: Deutsche Post AG
Key word(s): Enterprise
08.05.2018 Dissemination of a Press Release, transmitted by DGAP - a service
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Language: English
Company: Deutsche Post AG
Charles-de-Gaulle-Straße 20
53113 Bonn
Germany
Phone: +49 (0)228 182 - 63 100
Fax: +49 (0)228 182 - 63 199
E-mail: [email protected]
Internet: www.dpdhl.com
ISIN: DE0005552004
WKN: 555200
Indices: DAX
Listed: Regulated Market in Berlin, Dusseldorf, Frankfurt (Prime
Standard), Hamburg, Hanover, Munich, Stuttgart; Regulated
Unofficial Market in Tradegate Exchange
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