DHL Global Forwarding saw its airfreight volumes decline in the second quarter of the year, but its air gross profit was on the rise.
The world’s largest airfreight forwarder reported a 2.4% year-on-year decline in second-quarter airfreight revenues to €1.2bn, while volumes dropped by 5.8% on last year to 502,000 tonnes and gross profit was up 4.8% to €238m.
The volume decline reflects weaker market conditions as “tariffs and increasing uncertainty left their mark on overall trade volumes”.
Gross profit improvement is a reflection of the declining market conditions - there is generally a lag in price decreases being passed through to shippers - incremental improvement in organisation and processes and “strong internal discipline towards gross profit contribution of new business”.
When comparing performance with its rivals, DSV saw airfreight volumes decline by 2% during the second quarter, Kuehne+Nagel registered an 8.4% decline while Panalpina was up by 1% on the back of acquisitions.
The airfreight market is estimated to have declined by around 5% in the second quarter.
The overall DHL Forwarding and Freight business saw second-quarter revenues increase by 2.5% to €3.8bn.
Meanwhile, the total Deutsche Post DHL company – including its postal, express, supply chain and e-commerce businesses - saw revenues for the period increase by 3% to €15.5bn, ebit was up 2.9% to €769m and net profit was down by 11.2% to €458m.
"Overall, Deutsche Post DHL Group is in good shape. Our business developed as planned in the second quarter," says Frank Appel, chief executive of Deutsche Post DHL Group.
"We have already generated Group ebit of about €1.9bn after six months.
“That's nearly half of our minimum target for 2019. The measures we initiated to improve productivity at Post and Parcel and the postage rate increase as of July 1 will provide further momentum in the second half of the year, as will the traditionally strong final quarter.
“We are therefore confident about our further performance and have raised the lower end of our full-year forecast - despite the challenging macroeconomic environment."
The company invested a total of €1.3bn across all divisions from April to June largely as a result of its intercontinental fleet renewal at DHL Express, on which the company spent €743m in the second quarter alone.
So far Deutsche Post DHL Group has commissioned the first two of 14 new Boeing 777 freight aircraft. Two further aircraft are scheduled to follow this year.
