DHL Group's Q2 earnings slump as freight volumes slide
Reuters
Published Aug 01, 2023 06:42
Updated Aug 01, 2023 09:57
BERLIN (Reuters) -German logistics and mail group DHL reported a slide in quarterly revenue and earnings on Tuesday due to a slump in freight volumes and prices, and warned of economic uncertainty ahead.
Shares in DHL dropped 4% to 44.85 euros by 0807 GMT after the group said revenue fell by just over 16% to 20.1 billion euros ($22.07 billion) in April-June, missing an analysts' consensus forecast of 21.7 billion euros.
The Bonn-based group, which recently changed its name from Deutsche Post (ETR:DHLn) DHL and saw Tobias Meyer take over as CEO in May, saw the sharpest revenue decline at its freight and freight forwarding business, which accounts for around a quarter of DHL's revenue. It slid around 41% from a year earlier, the group said.
Falling global consumer demand, soaring inflation and high inventories have dragged freight rates down from their pandemic highs, denting the earnings of freight forwarders such as DHL, Kuehne+Nagel and Denmark's DSV.
"We all knew that a normalisation would come after the unusual year 2022. The normalisation is here now," DHL's finance chief Melanie Kreis told journalists during a conference call.
At the same time, e-commerce volumes in Europe returned to growth, and earnings at DHL's Supply Chain business came in better than expected.
DHL's group operating profit (EBIT) dropped by 27% to 1.69 billion euros in the second quarter, a tad above analysts' consensus for 1.65 billion published on DHL's website.
The group raised the lower end of its 2023 profit guidance range. It now sees its annual EBIT between 6.2 billion and 7 billion euros, having previously forecast a figure between 6 and 7 billion.
"In the medium term, we are convinced that we will return to EBIT growth and will generate more than 8 billion euros in a normalized economic environment," Kreis said, affirming DHL's medium-term earnings outlook.
($1 = 0.9109 euros)
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Written By: Reuters
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