Deutsche Post AG

Earnings Release • Aug 3, 2007

News Details

Corporate | 3 August 2007 07:30

Deutsche Post World Net boosts revenue and earnings

Deutsche Post AG / Quarter Results

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Deutsche Post World Net boosts revenue and earnings
in first half

• Consolidated revenue climbs 5.4 percent
• EBIT rises by 9 percent to 1.7 billion euros
• EXPRESS and LOGISTICS fuel earnings growth
• Earnings guidance of at least 3.6 billion euros EBIT
for full year 2007 confirmed

Bonn, Aug. 3, 2007: Deutsche Post World Net, the world’s leading provider
of logistics services, successfully concluded the first half of 2007,
boosting both revenue and EBIT. Consolidated revenue rose by 5.4 percent to
30.9 billion euros, fueled by the contributions of all divisions in the
Group. EBIT increased by 9 percent to 1.7 billion euros. Before
non-recurring items, the increase totaled 12.4 percent. The earnings growth
was fueled by the LOGISTICS and EXPRESS divisions. 'The LOGISTICS division
continued its strong earnings growth, and the EXPRESS division made major
progress,' Klaus Zumwinkel, the Chairman and Chief Executive Officer of
Deutsche Post World Net, said at the half-year press conference in Bonn.
For the entire year, the Group continues to expect a positive business
development. 'We can confirm our guidance that the underlying EBIT will
total at least 3.6 billion euros for the entire fiscal year of 2007,'
Zumwinkel said.

Consolidated net profit

During the first half, consolidated net profit after minorities totaled 784
million euros, an increase of 7.1 percent over the same period last year.
Earnings per share were 65 cents, compared with 61 cents. In the second
quarter, consolidated net profit climbed 13.1 percent to 285 million euros.
Earnings per share rose to 24 cents from 21 cents, accordingly. Thus,
growth of the consolidated net profit outpaced growth in revenue and EBIT.
On a quarterly basis, revenue climbed 6.5 percent to 15.4 billion euros,
and EBIT totaled 703 million euros, a jump of 9.5 percent over the same
period last year.

MAIL division

At the MAIL division, revenue increased by 1.3 percent to 7.5 billion euros
in the first half of the year. During the period, positive developments in
the international business once again more than offset the anticipated
decline in domestic mail activities in Germany. EBIT in the MAIL division
fell by 6.3 percent to 949 million euros. In addition to a decrease in work
days, last year’s price reduction for packages had a negative impact on the
results. During the second quarter, the division was pleasantly able to
stabilize its business: Cost-cutting and growth in international business
lifted EBIT by 3.4 percent to 331 million euros.

EXPRESS division

During the first half of 2007, the EXPRESS division raised revenue by 2
percent to 6.8 billion euros, thanks to volume growth in both the domestic
and international business. But because more than half of the revenue was
generated in countries outside Europe, the division experienced negative
currency effects of 223 million euros. In local currencies, organic revenue
growth of 6.2 percent was achieved. In Europe, the division boosted both
revenue and shipping volumes. In the Americas region, revenue rose 3.6
percent in terms of local currency, driven once again by the strong
business in Latin America. In the United States, higher income per shipment
offset the economy-induced decline in volumes. In the Asia Pacific and
EEMEA regions, revenue grew at double-digit levels as a result of strong
shipping totals and higher shipping weights.

EBIT in the EXPRESS division reached 161 million euros, compared with 19
million euros in the same period last year. Profitability improved
considerably in all regions.

LOGISTICS division

The LOGISTICS division continued to grow during the first six months of the
year. Revenue climbed by 6.7 percent to 12.5 billion euros. Excluding
negative currency effects and inorganic factors like the sale of the
waste-disposal company Vfw AG, revenue grew by 9.2 percent. In the DHL
Global Forwarding business unit, revenue remained stable at 4.5 billion
euros in the face of negative currency effects. At DHL Exel Supply Chain,
the positive trend that started in the first quarter continued in the
second: Revenue climbed by 12.8 percent to 6.4 billion euros, bolstered by
the 10-year contract with the British health-care agency NHS as well as by
higher revenue in Asia. In the DHL Freight business unit, revenue totaled
1.82 billion euros compared with 1.84 billion euros in the year-ago period.

EBIT for the entire LOGISTICS division totaled 414 million euros in the
first half, 28.2 percent more than the same period last year. The rise was
generated in part by the sale of Vfw AG in the first quarter. In the second
quarter, underlying EBIT rose 20.5 percent.

FINANCIAL SERVICES division

The FINANCIAL SERVICES division, which consists primarily of Postbank,
boosted revenue by 10.8 percent to 5.1 billion euros in the first half of
the year. EBIT totaled 493 million euros, 6.7 percent higher than in the
previous period last year. The growth in EBIT and sales was bolstered by
Postbank’s mobile sales and the bank’s mortgage lending business. With the
help of successful cost management, Postbank was able to offset the
increase in value-added tax as well as non-recurring costs stemming from
the integration of mortgage lender BHW. Following the acquisition of 850
outlets from Deutsche Post as well as the majority of BHW, Postbank can now
further increase its selling power and raise its market share.

SERVICES division

EBIT at the Services division was minus 298 million euros compared with
minus 257 million euros in the same period last year. The main reason for
the change were non-recurring effects stemming from the arbitration
proceedings with Deutsche Telekom and the sale of McPaper AG last year.

Outlook

Deutsche Post World Net still expects an underlying EBIT of at least 3.6
billion euros for the entire fiscal year of 2007.

In the MAIL division, revenue is expected to be stable or slightly higher.
The company still assumes that the revenue decreases experienced in the
domestic mail market will continue to be more than offset by the other
business units. In terms of earnings, a stable EBIT of around 2 billion
euros is expected.
In the EXPRESS division, the Group forecasts EBIT of at least 400 million
euros for 2007. This figure contains costs related to the new air-freight
hub Leipzig/Halle. The LOGISTICS division is expected to increase EBIT by
about 15 percent. The forecast doesn’t include the sale of Vfw AG. In the
FINANCIAL SERVICES division, EBIT is expected to rise at least 5 percent.
For the SERVICES division, EBIT of about minus 700 million euros is
forecast.

Please note:
The complete quarterly report is available at
http://investors.dpwn.de/de/index.htm.
The press conference will be broadcast at 10 a.m. at www.dpwn.de/presse.

Contact for media queries:

Deutsche Post World Net
External Communications

Prof. Manfred Harnischfeger
Dr. Martin Dopychai
Nicole Mommsen

Tel.: 0228/182 99 44
E-mail: pressestelle@deutschepost.de
DGAP 03.08.2007

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Language: English
Issuer: Deutsche Post AG
Charles-de-Gaulle-Straße 20
53113 Bonn
Deutschland
Phone: +49 (0)228 182 - 63 100
Fax: +49 (0)228 182 - 63 199
E-mail: ir@deutschepost.de
Internet: www.dpwn.de
ISIN: DE0005552004
WKN: 555200
Indices: DAX
Listed: Amtlicher Markt in Berlin, Frankfurt (Prime Standard),
Hannover, Düsseldorf, Hamburg, München, Stuttgart;
Terminbörse EUREX

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