DP DHL group Q1 revenue dips but freight forwarding turnaround continues

Deutsche Post DHL (DP-DHL) Group saw a slight dip in first quarter 2018 revenues to €14.7bn from €14.9 bn in prior year, mainly attributable to negative currency effects and the sale of UK supply chain subsidiary Williams Lea Tag.
On an organic basis – after adjusting for currency and portfolio effects – DP-DHL increased group first quarter revenue by 6.4%. Operating profit (EBIT) rose by 2.3% to €905m.
The Global Forwarding, Freight division continued its turnaround in the first quarter. Revenue increased by 1.3% to €3.6bn, adjusted for negative currency effects the improvement was even 7.2%.
Said DP-DHL: "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% to €70m."
Revenue in the Post-eCommerce-Parcel division increased by 1.7% to €4.6bn in the first quarter. The division’s positive performance was primarily attributable to growth in revenue in the eCommerce-Parcel business unit.
In the first quarter, the Express division "again continued the very good revenue and earnings performance sustained over several years," said DP-DHL.
Express revenue rose by 4.9% on the prior year to €3.8bn. Adjusted for currency effects, the increase was 13.2%. This 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.
The Supply Chain division saw first quarter revenue of €3.1bn in the first quarter, down from €3.5bn in the same period 2017. 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%. Operating profit declined to €55m (2017: €99m). 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.
Frank Appel, chief executive of DP-DHL Group, said: “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.” 
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