DHL earnings drop 25.6% in 2015

Deutsche Post DHL Group’s consolidated net profits (after non-controlling interests) fell 25.6 percent year-over-year to 1.5 billion euros on revenues that rose 4.6 percent to 59.2 billion euros compared with 2014.    Deutsche Post DHL Group posted consolidated net profits (after non-controlling interests) of 670 million euros (U.S. $737 million) for the fourth quarter of 2015, a 4.7 percent increase from the fourth quarter of 2014, according to the company’s most recent financial statements.
   Earnings before interest and tax (EBIT) for the quarter rose 5.7 percent year-over-year to 957 million euros, reflecting the 14.6 percent EBIT growth in the Post-eCommerce-Parcel division to 487 million euros.
   DHL’s fourth quarter revenues totaled 15.3 billion euros, down 0.2 percent from the fourth quarter of 2014.
   For the full year in 2015, however, DHL’s consolidated net profits (after non-controlling interests) dropped 25.6 percent year-over-year to 1.5 billion euros. EBIT fell 18.7 percent to 2.4 billion euros compared with 2014.
   DHL attributed the sharp decline primarily to one-off expenses, including a 336 million-euro charge, largely attributable to write-downs and provisions recognized in connection with the failed roll out of a unified IT platform in its global forwarding unit.
   Revenues stood at 59.2 billion euros for the full year, a 4.6 percent increase from 2014.
   DHL’s Post-eCommerce-Parcel division posted operating profits of 1.1 billion euros for the full year of 2015, a 15 percent year-over-year decline.
   “In addition to higher expenses for materials and personnel, the decline primarily reflects the higher investments made in expanding the national and international parcel infrastructure and the effects of the strike in Germany,” DHL said. The division’s revenues for 2015 totaled 16.1 billion, a 2.8 percent year-over-year increase.
   The Express division saw revenues jump 9.4 percent from 2014 to 13.7 billion, primarily from strong growth in international time definite shipments.
   In addition, the company’s Global forwarding, Freight division posted revenues of 14.9 billion euros for 2015, similar to the prior year’s level, while the Supply Chain division saw revenues jump 7.2 percent year-over-year to 15.8 billion euros.
   Frank Appel, the chief executive of Deutsche Post DHL Group, recently told attendees of the TPM 2016 conference that despite costly mistakes associated with its New Forwarding Environment IT system, reports that the company might sell its freight forwarding division were “nonsense.”
   “We have no intention, there were no discussions, around that we are selling our DGFF (DHL Global Forwarding, Freight) division. We will keep that. We are very proud that we have a market leader division,” he said. “Yes, we had some challenges, we made some mistakes we corrected them.
   “We now have a much clearer path. We have found a better approach,” said Appel.

   Correction: A previous version of this story indicated that 2015 revenues fell 4.6 percent.