DHL Express has outgrown rivals UPS and TNT Express so far this year, according to the companies’results for Q3 and the first nine months of 2012, CEP-Research analysis shows.
DHL, with high single-digit revenue growth, double-digit profits growth and a higher profitmargin, appears to be benefiting from strong growth in Asia and the Americas and a solidperformance in Europe. UPS is generating low growth this year and improving profits slightly, butits International business is lagging behind the performance in its home US market. TNT’s revenuesand profits have fallen back due to weaker business in Europe, comparison of the results shows.
However, direct comparisons of the three integrators are only partially possible due todifferences in reporting. Moreover, FedEx’s performance is difficult to compare directly with itsthree rivals due to its June – May financial year, with its most recent quarter covering June toAugust 2012.
UPS, which breaks its express and parcels activities into ‘US Domestic’ and ‘International’,had flat worldwide package revenues of $10.8 billion in the third quarter and slightly lowerunderlying operating profits of $1.5 billion, but maintained its market-leading profit margin ofnearly 14 per cent. Its volumes were 2.9 per cent higher, on an average daily basis. Over the firstnine months, UPS’ worldwide package revenues were up 2.2 per cent at $32.85 billion with volumes3.3 per cent higher. Adjusted package profits were 3.5 per cent higher at $4.5 billion, leaving theprofit margin at about 13.7 per cent.
DHL Express increased its worldwide revenues by 9 per cent to €3.2 billion in Q3, improvedits operating profit by 6.9 per cent to €231 million and had an operating profit margin of 7.3 percent. In its core time-definite international (TDI) express business, DHL Express volumes increasedby 8.7 per cent per working day. Over the first nine months, DHL Express worldwide revenues grew by9.8 per cent to €9.4 billion, its operating profit improved by 23.4 per cent to €829 million andthe profit margin rose to 8.8 per cent.
TNT Express, which generates the bulk of its revenues in Europe, reported a 1.9 per cent fallin adjusted Q3 revenues to €1.7 billion with operating profits down 11.6 per cent to €38 million,representing a 2.2 per cent margin. Over the first nine months, adjusted revenues fell 1.5 per centto €5.3 billion, operating profits declined 15.6 per cent to €141 million and the profit marginslipped to 2.7 per cent.
Regional comparisons of the three companies are only possible to a certain extent. Both DHLand TNT publish regional figures but UPS, for whom Europe and Asia are the two major regions forinternational business, does not.
UPS Q3 International Package revenues, covering US exports and imports and all marketsoutside the US, were 3.7 per cent lower at $2.9 billion and volumes declined 1.2 per cent butoperating profits improved 7.7 per cent to $449 million. The company reported a recovery in Asiaexports and slower growth in Europe. From January-September, UPS International Package revenuesdropped 1.9 per cent to $8.9 billion on flat volumes and operating profits were 4.7 per cent lowerat $1.3 billion.
In Europe, DHL revenues grew 2.9 per cent to €1.35 billion in the third quarter and by 4.7per cent to €4.1 billion in the first nine months, with daily TDI volumes up 9 per cent betweenJanuary and September.
In comparison, TNT’s adjusted revenues in Europe were flat at €1.1 billion and its regionaloperating profit declined 22 per cent to €56 million but volumes increased by 7.1 per cent. Overthe first nine months, TNT had flat revenues of €3.67 billion, increased volumes by 4 per cent butsaw operating profits decline 27 per cent to €209 million.
In Asia Pacific, DHL revenues increased by 13.9 per cent to just over €1 billion in the thirdquarter. Over the first nine months, revenues rose by 16.8 per cent to €3.2 billion and TDI volumeswere 9.7 per cent higher on a daily basis.
TNT’s Asia revenues dropped by 12.2 per cent to €404 million in the third quarter and volumeswere 8.8 per cent but the region moved into the black with a small €3 million profit. Over thefirst nine months, revenues were down 9.4 per cent at €1.2 billion, volumes were 9.3 per cent lowerbut the previous year’s €28 million loss was turned into a €6 million profit.
In the Americas, DHL Q3 revenues soared by 28.7 per cent to €588 million. Over the first ninemonths, revenues rose by nearly 20 per cent to €1.7 billion, driven by the US, Mexico and SouthAmerica. Daily volumes grew by 8.6 per cent in the region over the nine months, including a 12.7per cent rise in US shipments.
TNT, whose business in the region largely comprises operations in Brazil, increased Q3revenues by 5.2 per cent to €122 million on flat volumes and reduced losses to €23 million. Overthe first nine months, revenues increased by 5.2 per cent to €362 million, volumes dropped by 1.9per cent and the regional loss was reduced to €70 million.
