News / Global Forwarding drags DHL Q1 numbers down, but 'we have the remedy'

Weak demand across Europe road freight ate into DHL’s freight forwarding division profits over the first three months of 2025, but its executive team are confident they can address the shortcomings in the near term.

A 3.2% revenue upturn, to €4.7bn ($5.3bn) was not sufficient to prevent the Global Forwarding division recording 23.2% year-on-year ebit decline, to €202m, compared with €263m last year.

Chief financial officer Melanie Kreis (pictured) told investors: “Our core industrial markets proved quite challenging over the period, but we are addressing this through improving our cost base, notably with a new TMS.

“While we are not pleased with our first-quarter forwarding performance, we are convinced that we are working on the right remedies.”

However, the air and ocean freight divisions fared better, reporting increases in profit per unit of 1% and 10%, respectively, year on year.

And the upturn on the air side came despite a volume dip of 3%, to 422,000 tonnes, while ocean freight volumes were relatively stable, up 1% compared with Q1 24, to 788,000 teu.

Ms Kreis added: “Global Forwarding saw relative stability in both volume and yields over the three months, but weekly volatility has increased, and this has made it far more difficult to offer forecasts.

“But we are a very asset-light, diversified business. Our priority remains supporting customers in this uncertain time, and we’re convinced that this will support our growth as well.”

If Global Forwarding’s first quarter was something of a let-down for the company, its largest division, Express, more than made up for it, recording a 5% ebit spike over the three months, to €662m, on the back of 2% revenue increase, to €6.1bn – despite a 7% drop in volumes on the same period last year.

“That volume drop had been expected,” said Ms Kreis, “but we managed to turn this into a year-on-year ebit increase, thanks to a combination of key drivers, namely our pricing mix, cost management, and good capacity utilisation.”

She added: “We managed capacity so successfully that we turned a decline into an increase, showing that Express is well placed to adapt.”

Similarly, the Supply Chain division recorded 5% growth in ebit, at €268m, with Ms Kreis claiming this was indicative of its “smooth operating performance” on the back of a modest increase in revenue, which was just short of €4.4bn.

Ms Kreis cautioned against misinterpreting Ecommerce’s ebit plummeting 9.2% year on year, to €52m, as revenue jumped 7.5%, to €1.75bn.

Noting “good top line growth even with the more cautious environment for spenders,” she said ebit development had been stunted by network investments and an associated increase in depreciation.

Read Loadstar Premium analysis on how DHL’s road transport business weighs on the group