DHL Global Forwarding, Freight with improved gross profit margin
Deutsche Post DHL Group, the world’s leading mail and logistics company, continued to grow in the financial year 2018. Group revenue was up by 1.8% to EUR 61.6 billion. After adjusting for currency effects and portfolio changes, the revenue increase was even greater at 6.0%. All four Group divisions contributed to the positive trend.
Growth was driven by the ongoing boom in e-commerce as well as sustained growth in international trade flows. The Group’s operating profit (EBIT) came to EUR 3.2 billion and thus reached the adjusted earnings target communicated in June 2018.
“2018 was a challenging year for Deutsche Post DHL Group, which we closed with a successful Christmas business. Despite rising geopolitical uncertainties, global trade continued to register growth. This benefitted our DHL divisions in particular,” says Frank Appel, CEO of Deutsche Post DHL Group.
The Global Forwarding, Freight division can look back on a successful year in 2018. The division increased revenue by 3.4% to EUR 15.0 billion despite focusing on only high-margin business. Adjusted for negative currency effects, revenue improved by an even more substantial 6.7%.
Gross profit, which is an important performance indicator for Global Forwarding, Freight, also performed strongly with an increase of 3.9% over the prior year to EUR 3.6 billion. The division registered gross profit margin improvements in both air and ocean freight. Road and rail transport in Europe also showed a positive development.
As in the first nine months, the division succeeded in translating its upward trend in gross profit into a significant EBIT increase. Operating profit surged 48.8% to reach EUR 442 million in the full year 2018, thus demonstrating that the initiatives to improve cost efficiency are taking effect.
Revenue in the Supply Chain division came in at EUR 13.4 billion in the past financial year (2017: EUR 14.2 billion). In addition to negative currency effects, the revenue decline mainly reflects the sale of the subsidiary Williams Lea Tag. After adjusting for those factors, revenue for the division increased by 4.3%. DHL Supply Chain continued to generate additional new business, closing additional contracts worth EUR 1.3 billion with both new and existing customers in financial year 2018.