Corporate | 3 August 2010 07:00
Deutsche Post AG / Half Year Results
03.08.2010 07:00
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Deutsche Post DHL growth accelerates in the second quarter - full year
earnings guidance increased
- Underlying EBIT climbs 95.7 percent to EUR 503 million -consolidated
net profit EUR 81 million
- Consolidated revenue rises 15.6 percent - double-digit growth in all
DHL divisions; MAIL revenue stable
- Increased guidance for fiscal year 2010: underlying EBIT expected to
total between EUR 1.9 billion and EUR 2.1 billion
- CEO Frank Appel: 'We are reaping the fruits of our strategic
initiatives and efficiency-enhancing measures'
Bonn, August 3, 2010: Deutsche Post DHL, the world's leading postal and
logistics group, generated double-digit revenue growth in the second
quarter of this fiscal year, strongly accelerating the growth rate compared
to the first quarter. At the same time, the Group nearly doubled its
underlying operating profit versus the same period last year. The DHL
divisions were the driving forces behind the increase in consolidated
revenue, which climbed 15.6 percent to EUR 12.8 billion compared with the
second quarter of 2009. This development reflects both the company's
success in acquiring business with new customers and the marked rise in
transport volume being fueled by the continuing economic recovery as well
as favorable currency effects in all DHL divisions. In addition, the
efficiency measures implemented in 2008 and 2009 have resulted in higher
margins and increased profitability of all divisions. Underlying EBIT at
the Group totaled EUR 503 million, 95.7 percent above the previous year's
level. Despite significant non-recurring expenses of EUR 250 million, which
were mainly related to the sale of the domestic Express business in France,
the Group's consolidated net profit still increased 22.7 percent to EUR 81
million in the second quarter of 2010.
'As an enabler of global trade, we benefited significantly from the
recovery of the world economy in the second quarter. This was particularly
true at the DHL divisions, which have become the sustainable driver of the
Group's profit growth,' said Deutsche Post DHL CEO Frank Appel. 'We are now
reaping the fruits of our succesfully implemented strategic initiatives and
efficiency-enhancing measures as well as the portfolio restructuring that
we have largely completed.' Second quarter 2010
In the second quarter, reported EBIT climbed to EUR 253 million, compared
with EUR 109 million in the previous year. This result includes
non-recurring expenses totaling EUR 250 million largely related to the sale
of the domestic Express business in France that was completed in June. At
minus EUR 142 million, the Group's net financial result was considerably
lower than the previous year's level of minus EUR 8 million. This change
was, however, solely the result of changes in the valuation of financial
instruments related to the sale of Postbank: While the previous year's
figure included positive effects totaling EUR 123 million, the updated
valuation had a negative impact of EUR 22 million in the second quarter of
2010. As a result of the operating improvements, the consolidated net
profit after minorities nevertheless rose by 22.7 percent to EUR 81 million
compared with the previous year. This reflects an improvement in earnings
per share to EUR 0.07 (2009: EUR 0.06).
Capital expenditure and cash flow
The Group's capital expenditures increased by 20.7 percent to EUR 286
million in the second quarter of 2010 (2009: EUR 237 million). This figure
includes investments made in new technologies by the MAIL division,
including state-of-the-art letter-sorting equipment as well as the
company's new E-Postbrief product. In the second quarter, operating cash
flow totaled EUR 365 million, well above the previous year's level of EUR
46 million. This positive development was driven by the improvement in
operating profit and the significant drop in restructuring expenses in the
EXPRESS division compared with the previous year. Free cash flow reached
EUR 217 million in the second quarter. During the first six months of each
year, the Group's liquidity is regularly impacted by the annual payment
made to the Bundes-Pensions-Service für Post und Telekommunikation, a
special pension fund for the company's civil servants, as well as the
dividend payment. Despite these recurring expenses, which totaled EUR 1.3
billion this year, and a restructuring cash-out of more than EUR 600
million, Deutsche Post DHL still had a solid liquidity position after the
first six months of the year. At the end of the second quarter, net
liquidity amounted to EUR 535 million, a decrease of EUR 1.2 billion
compared with the 2009 year-end level.
First half 2010
In the first half of 2010, revenue climbed 9.9 percent to EUR 24.8 billion.
The strong rise in underlying EBIT of 87.9 percent to almost EUR 1.1
billion was the direct result of growth in volumes and revenues as well as
the Group's increased efficiency. The rise of reported EBIT to EUR 765
million can additionally be attributed to the significant reduction in
non-recurring expenses. The Group's consolidated net profit after
minorities increased to EUR 1.8 billion, 81.0 percent above the level of
the same period last year (2009: EUR 1 billion). In addition to the
operating improvements, this development also reflects positive effects
from the first-time measurement of the forward related to the Postbank sale
from the first quarter that totaled around EUR 1.4 billion. In the first
six months of the previous year, income from the valuation of financial
instruments related to the Postbank sale totaled EUR 879 million. After the
first half of 2010, earnings per share totaled EUR 1.51, well above the
previous year's level of EUR 0.84. Operating cash flow amounted to EUR 270
million in the first six months of this year compared with a cash outflow
of EUR 229 million in 2009.
Guidance: Full-year underlying EBIT projection increased
For the entire year of 2010, the Group continues to expect a moderate
recovery in global transport volumes. As a result of the positive results
achieved during the first half of 2010 as well as the better-than-expected
development especially in the DHL divisions, the company has raised its
earnings guidance for fiscal year 2010. The Board of Management now
projects underlying EBIT to total between EUR 1.9 billion and EUR 2.1
billion. Deutsche Post DHL had previously expected an amount in the range
of EUR 1.6 billion to EUR 1.9 billion. While earnings in the MAIL division
are still expected to total between EUR 1.0 billion and EUR 1.2 billion,
the projected contribution by the DHL divisions is now expected to be
around EUR 1.3 billion (previous guidance: between EUR 1.0 billion and EUR
1.1 billion). As a result, for the first time DHL will make a bigger
contribution to the Group's earnings than the MAIL division. Corporate
Center/Other expenditures are still forecast at around EUR 400 million,
slightly higher than in the previous year. The Group also continues to
expect that consolidated net profit will improve in 2010 in line with the
operating business. Furthermore, the company anticipates that the positive
earnings trend will sustain in 2011.
'As the second quarter's results and the increased guidance for the entire
year demonstrate once again, Deutsche Post DHL is strategically well
positioned and is well prepared for the future,' Appel said. 'By pressing
forward with the implementation of our Strategy 2015, we will be able to
unlock the Group's full potential step by step over the coming years.'
MAIL division: successful parcel business
At EUR 3.2 billion, second-quarter revenue in the MAIL division was
virtually unchanged from the previous year's level (2009: EUR 3.2 billion).
The continuing trend of the physical letter being increasingly replaced by
electronic media as well as the loss of the Quelle business in Germany led
to a revenue decrease. These developments were compensated by the effects
of an additional working day and above all the positive performance of the
Parcel business in Germany. Against the backdrop of rapidly rising internet
retailing, revenue climbed significantly once again. Further strict cost
discipline and increased earnings in the parcel business more than offset
the stable revenue development as well as wage increases. As a result,
underlying EBIT increased by 42.1 percent to EUR 243 million during the
second quarter compared to EUR 171 million in the previous year's period.
EXPRESS division: accelerated growth
In the EXPRESS division, volumes continued to rise in the second quarter,
propelled by the economic recovery. As a result, international revenues
recorded double-digit growth and were able to more than offset decreases in
day-definite domestic products resulting mostly from the sale of the
domestic Express business in the United Kingdom. Overall, the pace of
growth for the EXPRESS division accelerated rapidly in the second quarter.
Revenue climbed by 19.2 percent to reach EUR 2.9 billion (2009: EUR 2.4
billion). Higher income from fuel surcharges also contributed to this
positive development. The division's earnings also improved significantly
in the reporting period. Underlying EBIT more than tripled, climbing from
EUR 65 million in the previous year's quarter to EUR 198 million in the
second quarter of 2010. In addition to increased revenue, the positive
development mainly reflects the completed restructuring program in the
United States, the withdrawal from the domestic Express business in the UK
and significant cost cuts achieved around the world.
GLOBAL FORWARDING, FREIGHT division: double-digit growth in air and ocean
freight
In the GLOBAL FORWARDING, FREIGHT division, the trend of rising volumes
observed since the second half of 2009 continued in the second quarter of
2010. Particularly in air freight, but also in ocean freight, transport
volumes climbed sharply compared with the previous year's quarter.
Considerable double-digit growth rates were generated in both categories.
Together with higher freight rates, this development led to a steep revenue
increase to EUR 3.6 billion in the second quarter of the current fiscal
year, an increase of 35.6 percent compared with the previous year's level
of EUR 2.7 billion. Higher prices for transport services weighed on the
division's margins in the second quarter. At the same time, however, the
division was increasingly able to pass on the higher prices for scarce
capacities that resulted from the strong increase in demand to its
customers. Supported also by continuing strict cost management, underlying
EBIT rose by 29.1 percent, climbing from EUR 79 million in the second
quarter of 2009 to EUR 102 million from April to June of this year.
SUPPLY CHAIN division: successful business with new and existing customers
Despite the loss of the Quelle business, revenue of the SUPPLY CHAIN
division rose significantly in the second quarter of 2010. While revenue
was still down slightly in the first quarter, it reached EUR 3.4 billion in
the second quarter of 2010, representing an increase of 10.7 percent
compared to 2009. New business wins and an increase in volume among
contracts with existing customers produced strong growth, particularly in
the Asia-Pacific region. In the second quarter, additional contracts with
new and existing customers worth around EUR 260 million were concluded. The
contract-renewal rate continued to be above 90 percent. As a result of
margin improvements, the direct result of efficiency-enhancing programs,
underlying EBIT climbed strongly to EUR 72 million (2009: EUR 16 million).
- End -
Note to newsrooms: You will find an interview with CEO Frank Appel and
additional background information at www.dp-dhl.com. Deutsche Post DHL's
half-year press conference will be broadcast on the internet starting at 10
a.m. at www.dp-dhl.com.
Contact for media queries:
Deutsche Post DHL
Media Relations
Sebastian Steffen
Tel.: +49 (0)228 182-9944
www.dp-dhl.com/press
Deutsche Post DHL is the world's leading postal and logistics services
group.
The Deutsche Post and DHL corporate brands offer a one-of-a-kind portfolio
of logistics (DHL) and communication (Deutsche Post) services. The Group
provides its customers with both easy to use standardized products as well
as innovative and tailored solutions ranging from dialog marketing to
industrial supply chains. About 500,000 employees in more than 220
countries and territories form a global network focused on service, quality
and sustainability. With programs in the areas of climate protection,
disaster relief and education, the Group is committed to social
responsibility. In 2009, Deutsche Post DHL revenues exceeded EUR 46
billion.
The postal service for Germany. The logistics company for the world.
For additional information, visit www.dp-dhl.com
Group financial highlights for the second quarter of 2010
2nd 2nd Changein
in millions of euros quarter2009 quarter2010 %
Revenue 11,070 12,795 15.6%
- of which international revenue 7,249 8,850 22.1%
Reported EBIT 109 253 >100%
Underlying EBIT 257 503 95.7%
Consolidated net profit after minorities
(incl. Postbank) 66 81 22.7%
Basic earnings per share (incl.
Postbank, in euros) 0.06 0.07 16.7%
Diluted earnings per share (incl.
Postbank in euros) 0.06 0.07 16.7%
Divisional revenue in the second quarter of 20101)
2nd Share of 2nd Share of
quarter total quarter total Chang
in millions of euros 2009 revenue 2010 revenue ein %
MAIL 3,209 29.0% 3,206 25.1% -0.1%
EXPRESS 2,407 21.7% 2,868 22.4% 19.2%
GLOBAL FORWARDING,
FREIGHT 2,663 24.1% 3,611 28.2% 35.6%
SUPPLY CHAIN 3,061 27.7% 3,387 26.5% 10.7%
Corporate Center /
Other
andconsolidation -270 n/a -277 n/a -2.6%
Revenue from
continuing
operations 11,070 100% 12,795 100% 15.6%
Divisional EBIT in the second quarter of 2010
2nd 2nd Changein
in millions of euros quarter2009 quarter2010 %
MAIL 150 241 60.7%
EXPRESS -51 -30 41.2%
GLOBAL FORWARDING, FREIGHT 68 99 45.6%
SUPPLY CHAIN 16 55 >100%
Corporate Center / Other and
consolidation -74 -112 -51.4%
EBIT from continuing operations 109 253 >100%
Divisional underlying EBIT in the second quarter of 2010
2nd 2nd Changein
in millions of euros quarter2009 quarter2010 %
MAIL 171 243 42.1%
EXPRESS 65 198 >100%
GLOBAL FORWARDING, FREIGHT 79 102 29.1%
SUPPLY CHAIN 16 72 >100%
Corporate Center / Other and
consolidation -74 -112 -51.4%
Underlying EBIT from continuing
operations 257 503 95.7%
1) Prior-period amounts adjusted
Group financial highlights in the first half of 2010
1st half of 1st half of Changein
in millions of euros 2009 2010 %
Revenue 22,575 24,811 9.9%
- of which international revenue 14,590 16,774 15.0%
Reported EBIT 136 765 >100%
Underlying EBIT 569 1,069 87.9%
Consolidated net profit after
minorities (incl. Postbank) 1,010 1,828 81.0%
Basic earnings per share (incl.
Postbank, in euros) 0.84 1.51 79.8%
Diluted earnings per share (incl.
Postbank in euros) 0.84 1.51 79.8%
Divisional revenue in the first half of 20101)
Share of Share of Chan
in millions of 1st half total 1st half total gein
euros of 2009 revenue of 2010 revenue %
MAIL 6,695 29.7% 6,652 26.8% -0.6%
EXPRESS 4,810 21.3% 5,488 22.1% 14.1%
GLOBAL FORWARDING,
FREIGHT 5,410 24.0% 6,728 27.1% 24.4%
SUPPLY CHAIN 6,206 27.5% 6,517 26.3% 5.0%
Corporate Center /
Other
andconsolidation -546 n/a -574 n/a -5.1%
Revenue from
continuing
operations 22,575 100% 24,811 100% 9.9%
Divisional EBIT in the first half of 2010
1st half of 1st half of Changein
in millions of euros 2009 2010 %
MAIL 557 629 12.9%
EXPRESS -443 80 n/a
GLOBAL FORWARDING, FREIGHT 113 152 34.5%
SUPPLY CHAIN 50 112 >100%
Corporate Center / Other and
consolidation -141 -208 -47.5%
EBIT from continuing operations 136 765 >100%
Divisional underlying EBIT in the first half of 2010
1st half of 1st half of Changein
in millions of euros 2009 2010 %
MAIL 578 633 9.5%
EXPRESS -55 352 n/a
GLOBAL FORWARDING, FREIGHT 129 156 20.9%
SUPPLY CHAIN 58 136 >100%
Corporate Center / Other
and
consolidation -141 -208 -47.5%
Underlying EBIT from continuing
operations 569 1,069 87.9%
1) Prior-period amounts adjusted
03.08.2010 Ad hoc announcement, Financial News and Press Release distributed by DGAP.
Media archive at www.dgap-medientreff.de and www.dgap.de
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Language: English
Company: Deutsche Post AG
Charles-de-Gaulle-Straße 20
53113 Bonn
Deutschland
Phone: +49 (0)228 182 - 63 100
Fax: +49 (0)228 182 - 63 199
E-mail: ir@deutschepost.de
Internet: www.dp-dhl.de
ISIN: DE0005552004
WKN: 555200
Indices: DAX
Listed: Regulierter Markt in Berlin, Frankfurt (Prime Standard),
Düsseldorf, Hannover, München, Hamburg, Stuttgart;
Terminbörse EUREX
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