DHL Q12024 revenue flat at €20.3bn, operating profit down at €1.3bn

DHL Group reported revenue of €20.3 billion for the first quarter of 2024 (Q12023: €20.9 billion) as there was no significant upturn in the global economy.

"As anticipated, the operating profit (EBIT) of €1.3 billion was below the previous year’s level (Q12023: €1.6 billion) but exceeded the same period of the pre-pandemic year 2019 (Q12019: €1.2 billion)," says an official release.

Tobias Meyer, CEO, DHL Group says: "We are in an unusually long phase of low momentum in global trade. In this environment, we continue to focus on consistent capacity and cost management. However, we also see further growth potential. The demand for omnishoring and e-commerce solutions remains high and our customers are becoming increasingly aware of sustainable logistics – we can clearly see this in the demand for GoGreen Plus. With our portfolio, we are ideally positioned to benefit from an upturn in global trade. Despite all the challenges, 2024 is a year of opportunities."

Express earnings down 30%
At Express, the expected continued weak demand led to a slight decline in shipment volumes, the update added. "The division is countering the sluggish market environment with productivity improvements, network optimisations and effective yield and cost management."

While revenue declined four percent to €6 billion, EBIT was down 30% at €632 million.

Global Forwarding, Freight: Lower freight rates hit revenue
The decline in revenue at Global Forwarding, Freight was primarily due to lower freight rates, the update added. "The division once again recorded volume growth in air and ocean freight compared to the weak prior-year period. Air freight volumes rose by 5.1 percent with the improvement primarily attributable to trade routes between Asia and Europe. Ocean freight volumes increased 6.6 percent compared to the same quarter of the previous year, with the volume of trade routes from Asia increasing."

While revenue slipped 15 percent to €4.6 billion, EBIT was down 32 percent at €263 million.

Air freight revenue was down 16 percent at €1.4 billion but volume increased five percent to 435,000 tonnes with growth primarily on trade lanes between Asia and Europe.

Supply Chain: stable revenue and earnings growth
The Supply chain division recorded revenue growth in all regions and across various sectors, supported by new business wins, contract renewals and growing e-commerce business, the update added. "Additional contracts with a volume of €3.5 billion were concluded in the first quarter of 2024. The annualised contract renewal rate remained at a consistently high level."

Revenue was up five percent at €4.3 billion and EBIT increased 13 percent to €256 million.

E-commerce: Revenue at new high
The e-commerce division maintained its revenue growth trend, up eight percent at €1.6 billion. The EBIT development, down 26 percent at €60 million, in the first quarter reflects higher costs due in part to the ongoing investments in the expansion of the networks, the update added.

Confirms 2024 outlook
DHL Group has confirmed its forecast for 2024, and expects EBIT to be between €6-6.6 billion and free cash flow, excluding acquisitions and divestments, of around €3 billion.

In its medium-term forecast for 2026, DHL continues to expect operating profit of between €7.5 billion and €8.5 billion, the update added.

(Video Credit: DHL)