In the first six months of 2005, Deutsche Post World Net increased its profit from operatingactivities (EBIT) by 10.6 percent to about 1.7 billion euros. At 21.5 billion euros, revenue rose
slightly compared with the first six months of 2004. First-half net income amounted to 939 millioneuros compared with 721 million euros in the same period a year earlier. Earnings per shareincreased from 65 euro cents to 84 euro cents. In the second quarter, net income grew by 76 percentfrom 275 million euros in the year-earlier quarter to 484 million euros, or 43 euro cents pershare. “Our development in the first six months shows that we are on the right track,” saidChairman and Chief Executive Officer Klaus Zumwinkel. “I can confirm once again that we will reachour earnings target of 3.6 billion euros for this year.”A lower tax rate of 19.3 percent and the discontinuation of goodwill amortization underInternational Financial Reporting Standards IFRS were among the main contributing factors to theprofit increase in the first half of 2005. In the first half of 2004, EBIT had still been impactedby goodwill amortization in the amount of 188 million euros. For the full year 2005, overall netprofit will rise by over 500 million euros. “We want to include our shareholders in this positivedevelopment through our dividend payout for 2005. For the current business year, we plan to pay adividend that is at least one third higher than in 2004,” said Chief Financial Officer Edgar Ernst.Based on yesterday’s share price, this corresponds to a dividend yield after taxes of 3.3percent.
Measures implemented under the STAR value creation program contributed 261 million euros toearnings during the first six months, compared to 178 million euros in the prior-year period. Sinceits launch in November 2002, the program has generated an accumulated 1.123 billion euros, a figurethat is expected to rise to at least 1.4 billion euros by year-end.
MAIL Corporate Division
In the first six months of 2005, revenue in the MAIL Division rose by 1 percent to 6.4billion euros, with increasing international volumes compensating for the anticipated revenuedeclines in Germany. The international mail business today contributes 16 percent to divisionalrevenue, compared to 12 percent in 2004. Profit from operating activities (EBIT) in MAIL declinedby 5.2 percent to 1.1 billion euros.
EXPRESS Corporate Division
In the first half of 2005, revenue in the EXPRESS Division increased by 1.8 percent to 8.8billion euros, making EXPRESS the Group’s strongest revenue driver and accounting for 40 percent ofoverall revenue. EBIT rose from 10 million euros to 163 million euros, largely attributable to theabsence of goodwill amortization. The company made considerable progress in the Americas region inthe first half of 2005, including improvement in delivery quality to 97 percent in the USA. “Ourcustomers are recognizing the better service quality in the USA, a fact reflected in rising revenueand improved profits,” said Zumwinkel. As previously communicated, the Group anticipates theAmericas region to incur a loss of as much as 300 million euros for the full year, with break-evenexpected in the fourth quarter of 2006. Return on sales for the Express business outside theAmericas region was 5.5 percent, with a return on sales of 1.9 percent for the division as awhole.
LOGISTICS Corporate Division
Revenue in the LOGISTICS Division (airfreight, ocean freight and contractlogistics) increased by 11.8 percent to around 3.6 billion euros in the first half of 2005. This isattributable to the positive organic growth of the two business divisions DHL Danzas Air &Ocean and DHL Solutions and the acquisition of KarstadtQuelle AG’s department store logistics onApril 1, 2005. EBIT almost doubled to 122 million euros from 66 million euros in the prior-yearperiod.
FINANCIAL SERVICES Corporate Division
The FINANCIAL SERVICES Division includes Postbank, the Pension Service and the retailoutlets. Postbank presented its results separately on July 27, 2005. In the first six months of2005, the division generated 3.5 billion euros in revenue, 3 percent less than in the prior-yearperiod, caused by continued low interest rate level. EBIT rose by 15.2 percent to 379 millioneuros.
Outlook
The company confirmed its expectation of reaching an operating profit of at least 3.6 billioneuros for 2005 overall. For MAIL, the Group as before expects EBIT for the year to stabilize ataround 2 billion euros. Operating earnings for EXPRESS, including the Americas region, are expectedto double over the prior-year figure of 367 million euros. The company is confident that LOGISTICSwill continue to grow and exceed the prior-year earnings of 281 million euros by 5 to 10 percent.In FINANCIAL SERVICES, the Group anticipates a 5 to 10 percent increase in earnings for the fullyear, compared to the 2004 figure of 692 million euros.
