Deutsche Post (DP) reports a 23.4% increase in revenue for Q2 compared to the same period last year. Operating income (Ebit) grew 12.2% to 2.3 billion euros, leaving a bottom-line profit of around 1.5 billion euros. The main driver was Global Forwarding Freight - currently the Group's top-selling unit. Thanks to sustained global demand for transport services, coupled with high freight rates, the business unit more than doubled its operating profit in the second quarter to 746 million euros.
Supply Chain achieved an Ebit of 244 million euros (+23.2%), while Express reports a 17.5% increase in sales to almost 7 billion euros, though profits fell 6.5% year-on-year with an EBIT of 1.1 billion euros. According to Deutsche Post, temporary lockdowns in China hampered an even better result in Express.
Freight takes pole position
Air freight volumes’ southward journey was also affected by modal shifts back towards ocean freight products, as customers recognized the improved schedule reliability in sailing. Ocean freight volumes grew by 11.3%, partly driven by DP’s integration of the acquired beverage logistics company, Hillebrand, at the beginning of the second quarter.
Overall, Deutsche Post remains on a growth track thanks to its flourishing business and spurred particularly by its freight activities. They more than made up for declines in the German parcel business following record sales during the corona crisis. “We had a very good second quarter - despite the current challenges,” commented CFO, Melanie Kreis. Risks “relating to the development of energy prices, inflation, and interest rates, do not currently play a major role in our earnings development,” she stressed. Higher fuel prices, for example, were passed on to customers by the Group.
“Solid rock in uncertain times”
Deutsche Post DHL Group CEO, Frank Appel, knew who to thank for the good quarterly results: the many employees of the company: “Thanks to the outstanding efforts of our staff, we provide our customers with reliable logistics solutions also in volatile times. This strength is reflected in the excellent earnings performance and will continue to pay off in the future,” the executive forecast. He went on to say: “Based on our strong international footprint coupled with the most modern infrastructure, we are able to offer reliable solutions in an increasingly complex environment across all sectors. We remain solid as a rock in uncertain times.”
New round of consolidation
The business results tabled by Deutsche Post, are in line with outstanding figures recently presented by Kuehne+Nagel, DSV, and DB Schenker. (See: DSV, K+N and Schenker enjoy cargo bonanza in 1H, 2022 - CargoForwarder Global.)
Despite all the differences in detail, they prove that the logistics industry is currently flying on cloud nine. No market analysis is needed to predict that this will trigger a new round of mergers and acquisitions, leading to the further consolidation in the transport industry, as the coffers of the enterprises are filled to the brim thanks to enormous profits. Companies such as the Austrian logistics player, cargo-partner, which is up for sale (See: https://www.cargoforwarder.eu/2022/07/10/agent-cargo-partner-is-for-sale/ ), will therefore not have to wait long for lucrative offers from investors willing to buy, or may already have received them.
The major shipping companies have also long since evolved into multimodal transport service providers. As exemplified by Danish giant, A. P. Moeller-Maersk or its French peer, CMA CGM. Their aim is to offer the market holistic and seamless logistics solutions from the shipper’s doorstep to the consignee's reception desk – and these include air freight options.
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