DHL Global Forwarding reports record airfreight revenues

DHL Global Forwarding reported record airfreight revenues last year but performance weakened as the year progressed.

The world’s second-largest airfreight forwarder saw airfreight revenues increase 18.7% year on year in 2022 to €10.4bn while air gross profits improved 48.5% to €2bn. These improvements came despite a 9.3% decline in volumes to 1.9m tonnes.

Performance across the air business also deteriorated as the year progressed: in the fourth quarter, air revenues were down 22.8% year on year to €2.2bn, gross profits were up by the lesser amount of 10.8% to €421m and volumes dropped by 20% to 449,000 tonnes.

“The global forwarding market was volatile in 2022,” parent Deutsche Post DHL said in its annual report. “Market tailwind continued at the beginning of the year.

“Market volume slowed down over the course of the year in line with the development of the macro environment, which was influenced by factors such as the war in Ukraine, pandemic-related lockdowns in Asia and high inflation.

“Additionally, with the recovering capacity in the air and ocean freight markets, the prices showed a quick decline in the second half of the year.”

A shift back to ocean freight – which was plagued by disruption in 2021 – also had an impact on volumes, the company said.

Declines were seen primarily on the trade lanes between China and the US as well as between China and Europe.

Meanwhile, revenues were largely boosted by higher freight rates, although these weakened as the year progressed.

“In the fourth quarter of 2022, lower volumes and rates caused air freight revenue to decrease by 22.8 %, whilst gross profit was up 10.8 %.”

The overall Global Forwarding division’s performance largely reflected airfreight, with record revenues but a downward trend as the year progressed.

Revenues for the year were up 32.3% to €30.2bn and earnings before interest and tax (ebit) increased 77.4% to €2.3bn.

The overall DP DHL business saw revenues increase 15.5% year on year to €94.4bn, ebit was up 5.7% to €8.4bn and net profit increased 5.4% to €5.7bn.

“The jump in revenue resulted entirely from the international business of the DHL divisions, despite the fact that global trade and e-commerce normalized in 2022 as expected with slowing momentum in the final quarter,” DP DHL said. “Consequently, shipment volumes were slightly below the all-time high of 2021.”

It added: “The company also benefited from the increasing demand for resilient supply chains in contract logistics and, particularly in the first half of the year, from high freight rates in the forwarding business.”