While parent company Deutsche Post-DHL Group increased its first quarter earnings before interest and tax (EBIT) by 21.3 percent to \u20ac873 million, compared with the same period last year, its airfreight volumes slipped by 8.8 percent and its forwarding revenues fell by 12.2 percent in a challenging first quarter for the year.
\nDespite the disappointing figures, however, DHL put a positive spin on its airfreight operations, saying that the drop in volumes came about by adopting a \u201cmore selective market strategy\u201d and eliminated certain low-margin business activities. In its Q1 2016 statement, DHL said it had \u201csecured additional new business during the reporting period, which will be implemented as the year progresses and is expected to have a positive impact on volume development.”
\nIn addition, during the Q1 results call, DHL Group CEO Frank Appel said he was unconcerned with the recent announcement that chief rival Amazon will be leasing twenty 767-300 freighters from Atlas Air Worldwide\u2019s subsidiaries, Atlas Air and Titan Aviation, which also leases aircraft to DHL. \u201cAtlas can work with other customers and [the deal] has, to our knowledge, no impact on our operations,” Appel said. “It is normal that airlines work with other customers.\u201d
\nDHL\u2019s Global Forwarding arm reported Q1 revenues of \u20ac3.3 billion for 2016. Adjusted for negative currency effects, revenue declined by 9.3 percent, the company said. Airfreight volumes fell to 476,000 tonnes, representing the fourth consecutive quarter in which the forwarding arm experienced airfreight volume declines, year-over-year. These comparisons, DHL added, were also affected by last year’s U.S. West Coast port strike, which provided a temporary demand boost during the first quarter of 2015.
\nAirfreight revenues declined by 18.4 percent, y-o-y, to \u20ac1 billion, thanks mostly to currency effects and lower fuel surcharges. Gross profit for airfreight fell to \u20ac210 million, a 4.5 percent decline, y-o-y.
\nNevertheless, operating earnings for the forwarding division did show improvement, rising from \u20ac17 million in the previous Q1 to \u20ac51 million in Q1 2016. The company called these results \u201ca clear indication of the positive effects of measures introduced in the past year to improve operating performance at Global Forwarding, Freight.\u201d
\nMeanwhile, the EBIT for DHL’s Supply Chain division increased from \u20ac53 million to \u20ac127 million, y-o-y. Also, the Express arm saw an increase in EBIT of 7.5 percent, y-o-y, to \u20ac357 million, while the Post – eCommerce – Parcel division saw its operating profit rise 3.3 percent, y-o-y, to \u20ac412 million.
\nFor the rest of 2016, the DHL Group said it is expecting only \u201cmoderate growth\u201d in the global economy but is optimistic about its recent strategic measures it has enacted. \u201cWe\u2019ve had a good start to the current year,\u201d Appel said. \u201cWe have registered the strongest first quarter in our company history. The efforts we made in 2015 to position ourselves for profitable growth in all divisions are paying off. Last year was a year of transition, and we are now firmly on track to achieve our targets for 2016.”
\nSource: aircargoworld<\/p>\n","protected":false},"excerpt":{"rendered":"