Deutsche Post DHL Group (NASDAQ:DPSGY) reported on Wednesday strong first-quarter results that led the German transport and logistics giant to substantially increase full-year earnings guidance and cash flow targets.
For the quarter, revenue rose 26% from 2020 levels to $22.7 billion, while free cash flow increased by one-third to $1.9 billion. Earnings before interest and taxes (EBIT) more than tripled to nearly $2.3 billion. Net income rose to more than $1.4 billion. The profit figures were first-quarter records, said CEO Frank Appel in a statement.
The company reported $1.13 in earnings per share on a diluted basis, more than quadrupling first-quarter 2020 results. Deutsche Post DHL’s American Depositary Receipts (ADR) closed Tuesday at $59.15. Shares are up 18.7% year-to-date.
Quarterly operating cash flow more than tripled to $3 billion, as did free cash flow to more than $1.4 billion, the company said. Free cash flow is typically negative in Deutsche Post DHL’s first quarter, which is generally its weakest of the year.
Appel said the results represented the company’s best-ever first quarter. The final figures were higher than the preliminary data published last month, the company said.
The company raised its 2021 EBIT targets to more than $8 billion from $6.73 billion and free cash flow to $3.6 billion from $2.76 billion.
All five of the company’s operating divisions performed well in the quarter, the Bonn-based company said. DHL Express, its time-definite international air unit and the company’s largest, posted a 32.5% revenue gain to $6.6 billion. Volumes rose by 26.3% year-on-year, while EBIT margins nearly doubled to 17.5%.
The global forwarding unit posted a 32.7% revenue gain to $5.77 billion amid an environment of very tight capacity on international air and sea lanes. Air volumes rose 18.2% and ocean volumes increased 8.8%. EBIT rose to $259.6 million.
The relatively new e-commerce unit posted a 46% gain in revenue to $1.8 billion as strong demand in 2020 carried over into 2021. The supply chain unit, which has lagged the other divisions due to the impact of the COVID-19 pandemic on customer activity, reported organic revenue gains of 4.7% to $3.8 billion, the company said. EBIT rose to $200 million from $126 million, the company said.