News / DHL pulls out of race for DB Schenker as it reports full-year 2023 numbers

DSV is now the remaining 3PL in the bidding for DB Schenker, after DHL said this morning it was not interested in buying its compatriot and, in its earnings call last week, Kuehne + Nagel also said it was not bidding.

DHL, reporting its full-year 2023 results today, said it had a “continued focus on strategic bolt-on acquisitions; hence [the] conscious decision against participation in the Schenker process”.

The firm said it had projected free cash flow to be about €2.75bn ($3bn) in 2024, “including a €250m blanket budget for M&A expenses” – taking it well out of the running for the €15bn investment buying Schenker would entail.

In the earnings call, CEO Tobias Meyer said that DHL would need to see “very substantial upside in M&A”, and Schenker did not represent “the value generation we are looking for”.

DHL’s 2023 results, meanwhile, reflected the “weak global economic environment”. Group revenue was €81.8bn, down 13% year on year, with ebit of €6.3bn, down 25%, but meeting its forecast. Consolidated net profit fell more than 30%, to €3.7bn.

But Mr Meyer said: “Our high profitability allows us to continuously invest in our network, sustainability, digitalisation and our e-commerce capabilities, and to further improve quality for our customers.

“Major uncertainty factors, such as volatility in demand and geopolitical crises, will remain with us in 2024. However, we are very well positioned for the opportunities and challenges.”

He added: “We are continuing to invest in our logistics network – particularly in our e-commerce capabilities, but also in the decarbonisation and digitalisation of our operations.”

DHL said its profitability was, in part, due to its diverse portfolio. While Express and Global Forwarding “faced headwinds”, Supply Chain grew and eCommerce benefited from growth in the sector.

Global Forwarding, Freight revenue fell 36%, to €19.3bn, while ebit fell nearly 40 to €1.4bn. It said: “Market volumes were down compared with the previous year, due to weak demand, but stabilised over the course of the year.

“As expected, air and ocean freight rates continued to normalise. In the European road freight market, the cyclical decline in demand continued. Costs remained at a high level, due partly to increased diesel and vehicle prices as well as staff costs.”

You can read a more detailed analysis of DHL’s stance on DB Schenker, and its results, here.