Deutsche Post DHL Raises Forecast After Record Quarterly Results

The world’s leading logistics company Deutsche Post DHL Group has today published preliminary results for the second quarter of 2021. At the same time, the outlook for the current financial year and for 2023 has been raised, and a new Corona special bonus1 for around 550,000 employees worldwide has been decided.

(Bonn) The preliminary operating result (EBIT) for the second quarter of 2021 was increased to a record level of around 2.075 billion euros, more than doubling compared to the previous year (Q2 2020: 912 million euros). In light of the excellent business development, the company has raised its EBIT forecast for 2021 to more than 7.0 billion euros (previously: more than 6.7 billion euros). The medium-term earnings outlook for 2023 is now set at more than 7.4 billion euros (previously: more than 7.0 billion euros).
“The second quarter has once again proven that global trade is continuing to recover and that the e-commerce boom is here to stay – we are benefiting greatly from both developments. All divisions are operating at full speed worldwide and achieving double-digit EBIT growth rates. Our thanks go to our employees, who are doing fantastic work worldwide and have earned another Corona bonus,” said Frank Appel, CEO of Deutsche Post DHL Group.

Recognition for the Tireless Efforts of Employees

As recognition for their tireless efforts during the pandemic, the company has decided to pay employees worldwide another Corona special bonus of 300 euros¹. This one-time payment is aimed at around 550,000 colleagues in all business areas and countries. Excluded are executives. The resulting costs of around 200 million euros will be recorded in the third quarter of 2021 and are already included in the updated earnings forecast for 2021.

All Divisions Achieve Significant Earnings Jump

All divisions were able to significantly exceed the previous year’s results. The utilization of networks remained consistently high in the second quarter of 2021. B2C shipment volumes were above the previous year’s level across all networks, while the recovery of the B2B business continued. At the same time, the capacity situation in the air and sea freight markets remained strained.
Express: The Express division achieved an EBIT of around 1.170 billion euros in the second quarter of 2021, compared to 565 million euros in the second quarter of the previous year.
Global Forwarding, Freight: The EBIT of Global Forwarding, Freight amounted to around 315 million euros in the second quarter of 2021, significantly above the 190 million euros in the same quarter of the previous year.
Supply Chain: The EBIT of Supply Chain was around 195 million euros in the second quarter of 2021, significantly above the 33 million euros of the previous year’s quarter, which was marked by initial pandemic effects.
eCommerce Solutions: In the eCommerce Solutions segment, EBIT in the second quarter of 2021 was around 115 million euros, significantly up from the previous year’s result of 1 million euros.
Post & Paket Deutschland: Post & Paket Deutschland achieved an EBIT of around 315 million euros in the second quarter of 2021, compared to 264 million euros in the same quarter of the previous year.
The ongoing positive business development is underscored by the continued strong development of cash flow. In the second quarter of 2021, the company was able to increase free cash flow to more than 800 million euros (Q2 2020: 605 million euros). For the first half of 2021, free cash flow thus exceeded 2.0 billion euros (H1 2020: 196 million euros).

Investments of 3.9 Billion Euros

The group EBIT for 2021 is expected to be more than 7.0 billion euros, given the strong earnings dynamics (previously: more than 6.7 billion euros). This includes an additional personnel expense of around 200 million euros for the approved Corona special bonus. For the entire year 2021, the group now forecasts free cash flow of more than 3.2 billion euros (previously: more than 3.0 billion euros). Gross investments in 2021 are expected to be around 3.9 billion euros (previously: around 3.8 billion euros). The group tax rate for the entire year 2021 is now expected to be at the upper end of the previous forecast of 26-28 percent at around 28 percent.

Outlook

The medium-term outlook for group EBIT in 2023 has been raised to more than 7.4 billion euros (previously: more than 7.0 billion euros). The forecast of around 9.0 billion euros for cumulative free cash flow in the years 2021 to 2023 remains unchanged. The outlook for gross investments for the period 2021 to 2023 has also been confirmed at around 11.0 billion euros.
The group will publish the full report for the second quarter / first half of 2021 as planned on August 5, 2021.
¹ 300 EUR based on a full-time employee
Photo: © Deutsche Post DHL