DHL highlighted the growth potential it is seeing in omnishoring and e-commerce as it reported positive numbers for the first quarter of the fiscal year 2024.
Group revenue stood at €20.3 billion (US$22 billion), almost steady from €20.9 billion recorded during the same first quarter period in 2023.
DHL said, "As expected, there was no significant upturn in the global economy in the first quarter of 2024."
Operating profit (EBIT) was slightly lower at €1.3 billion for the period than the €1.6 billion recorded in the previous year's similar period.
DHL said, however, that this is still higher than the pre-pandemic level of
€1.2 billion recorded in the first quarter of 2019.
"We are in an unusually long phase of low momentum in global trade. In this environment, we continue to focus on consistent capacity and cost management. However, we also see further growth potential," said Tobias Meyer, CEO of DHL Group.
"The demand for omnishoring and e-commerce solutions remains high, and our customers are becoming increasingly aware of sustainable logistics — we can clearly see this in the demand for GoGreen Plus. With our portfolio, we are ideally positioned to benefit from an upturn in global trade."
"Despite all the challenges, 2024 is a year of opportunities," Meyer added.
DHL Group said it had already anticipated the slowdown in global economic momentum in 2022 and successfully introduced appropriate measures to safeguard earnings and cash flow, including consistent capacity and cost management as well as price adjustments.
The Group also continued to make targeted investments in the quality of its services and in structural growth trends such as omnishoring, e-commerce, sustainability and digitalization.
Group confirms forecast for 2024
DHL forecasts an operating profit of between €6.0 billion and €6.6 billion for this fiscal year.
"As expected, a broad and dynamic economic upturn failed to materialize in the first three months of the year. DHL Group continues to expect more positive global economic momentum in the second half of 2024," it said.
"Overall, the Group confirms its forecast for the 2024 fiscal year and expects EBIT of between €6.0 billion and €6.6 billion and free cash flow excluding acquisitions and divestments of around €3.0 billion," DHL added.
In its medium-term forecast for 2026, DHL Group continues to expect an operating profit of between €7.5 billion and €8.5 billion.
DHL reported a decline in revenue due to lower freight rates at Global Forwarding, primarily due to lower freight rates. The division once again recorded volume growth in air and ocean freight compared to the weak prior-year period.
It noted that air freight volumes rose by 5.1%, with the improvement primarily attributable to trade routes between Asia and Europe.
Ocean freight volumes increased 6.6% compared to the same quarter of the previous year, with the volume of trade routes from Asia increasing in particular.
DHL's supply chain division recorded revenue growth in all regions and across various sectors, supported by new business wins, contract renewals and growing e-commerce business.
Meanwhile, DHL noted that its e-commerce division maintained its revenue growth trend.