DHL Express should increase its operating profit excluding special effects by 50% to more than EUR500 million in 2007 after turning around its loss-making US business last year, Deutsche Post World
Net executives told the annual results press conference today.In 2006, DHL Express made an operating profit of EUR 325 million on turnover up 2.2% to EUR17,195 million. This included EUR 50 million of investment costs for the new Leipzig hub, andreduced losses of “several hundred million euros” in its US business. In 2005, DHL Express had anoperating loss of EUR 23 million.
CFO Edgar Ernst said that for DHL Express in 2007, “we expect an EBIT of at least EUR 400million. Adjusted for extraordinary costs of EUR 100 million for the new hub in Leipzig, we willachieve an EBIT of more than EUR 500 million, which is an increase of over 50% compared to 2006.”
Chairman Klaus Zuminkel reiterated that DHL Express expects to break even in the USA in 2009,making an operating profit of at least EUR 1 billion in that year. The loss-making French businesswould remain in the red this year, he added.
Meanwhile, Deutsche Post World Net is expecting to generate “high double-digit million euro”savings from the transfer of its German domestic parcel business from DHL Express into the DeutschePost mail division. The integration of the 13 parcel branch offices and 33 parcel sorting centresinto the mail sorting network will be carried out within the next few weeks, Zumwinkel said.
In all, DPWN expects synergy effects worth a “high double-digit million euro” sum each yearfrom the integration, with savings in the areas of overheads and IT in particular. But Zumwinkeldeclined to give a figure for the potential job losses resulting from the restructuring.
“To make the Germany parcel business even more profitable, we are also working to improvecustomer service,” he pointed out. One project is to improve complaints handling and to providebetter and faster information about the location of parcels.
