Deutsche Post DHL: e-commerce boosts Q3 performance

10/11/2020

Deutsche Post DHL reported Q3 ’20 results today.

Key points:

– Continued growth trajectory: Group revenue increases by 4.4% to EUR 16.2 billion; organic revenue growth even stronger at 9.0%

– Operating profit (EBIT) climbs nearly 50% to EUR 1.4 billion; Group’s preliminary figures and raised 2020 EBIT guidance confirmed, free cash flow expectation further increased

– Particularly dynamic development in Parcel, Express and eCommerce Solutions business

– CEO Frank Appel: “We had a successful third quarter thanks to our 550,000 employees and to our outstanding portfolio of e-commerce logistics solutions benefitting both small and large customers globally.”

Deutsche Post DHL Group saw strong growth in the third quarter of 2020. In an economic climate dominated by COVID-19, the Group grew its revenue by 4.4% to EUR 16.2 billion.

Organic revenue – after adjusting for portfolio and currency effects – was up by even 9.0%. With its broad range of logistics services, Deutsche Post DHL Group has benefitted from the surge in global e-commerce activities.

The Group’s Post & Parcel Germany and DHL eCommerce Solutions divisions reported especially pronounced growth in shipment volumes.

Volumes also surged in the time-definite international Express business across all regions, which allowed the Group to utilize its network very well. Deutsche Post DHL Group increased operating profit (EBIT) by approximately 50% compared with the prior year to EUR 1.4 billion. With this, the Group confirmed its preliminary figures issued in October.

The EBIT margin rose from 6.1% to 8.5%. The free cash flow increased by more than EUR 750 million to around EUR 1.3 billion compared with the prior year…

To read the full release, please click here – it also contains an update on its core logistics units, DHL GFF and DHL SC. More here:

– Global Forwarding, Freight: Efficient response to a changed market environment

Despite ongoing capacity shortage in the international transport markets, the Global Forwarding, Freight division increased third-quarter revenue to around EUR 3.8 billion (2019: EUR 3.7 billion). Operating profit rose by 25.0 percent to EUR 155 million, including one-time special bonus expenses of EUR 13 million. The positive year-on-year margin development in the airfreight business had a notable effect on earnings and compensated declining volumes. In addition to the continued lack of cargo capacity on international passenger flights, the division was confronted with a further shortage of ocean freight capacity.

– Supply Chain: Increasing customer activity led to higher revenue and earnings in the course of the quarter

Customer activity in contract logistics picked up over the course of the third quarter as the division increasingly recovered from the weak, pandemic-related momentum of the previous quarter. At around EUR 3.1 billion, however, revenue was still below the previous year’s level (2019: EUR 3.4 billion). Operating profit for the Supply Chain division came to EUR 111 million in the third quarter, including one-time special bonus expenses of EUR 52 million. Adjusted for the bonuses, earnings were nearly at the previous year’s level of EUR 162 million. The division achieved this good performance in a volatile market environment thanks to its high cost discipline and its flexibility in finding new solutions for customers.

All the relevant, supporting material for investors can be found here.

Stock down 1.7% in early trade, below €40, then -3.9%, -5.9% versus DAX up 0.2%, down a bit, then steady at -0.1%/-0.3% (@ 12 noon GMT).