DHL Group once again demonstrated its resilience in a less dynamic market environment in the second quarter of 2023.
The Group achieved revenue of US$22 billion (Q2 2022: US$26.2 billion). Operating profit (EBIT) was level with the first quarter at US$1.9 billion.
As expected, the second quarter, which continued to be characterized by lower volumes and declining freight rates, did not match the record earnings of the previous year (Q2 2022: US$2.52 billion).
Despite the persistently weaker market dynamics, DHL Group achieved an attractive EBIT margin of 8.4% (Q2 2022: 9.7%). The Group raises the lower end of its 2023 EBIT guidance and confirms its earnings forecasts for 2025.
DHL Group is once again benefiting from its broad logistics portfolio overall.
While the DHL Express and DHL Global Forwarding, Freight divisions are more strongly correlated with the global economy, long-term customer contracts at DHL Supply Chain ensured a continuously stable earnings situation and further growth in the second quarter.
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Tobias Meyer, CEO of DHL Group said: “Thanks to our balanced portfolio and global presence, we were once again able to demonstrate our resilience. This is particularly evident in times of a weak global economic momentum.
“We took the right measures at an early stage to deal with the current macro environment. This, along with the dedicated efforts of our employees, is reflected in the high earnings level, which is well above those of the pre-pandemic years.”
Forecast scenarios revised: Group expects further growth in the medium term
With half-year earnings of US$ 3.62 billion, the Group performed well in a challenging environment. Therefore, DHL Group raises the lower end of its EBIT guidance for 2023 to US$6.8 billion (previously US$ 6.6 billion). The Group continues to plan with the three scenarios presented at the 2022 Annual Results Press Conference in March:
In the favorable event of a recovery of the global economy early in the second half of the year ("V-shaped" development), the Group expects EBIT of around EUR 7.0 billion (unchanged).
In the event of a recovery at the end of the year ("U-shaped" development), the Group expects EBIT of around EUR 6.6 billion (previously EUR 6.5 billion).
In the unfavorable event of no significant recovery in the global economy in the remainder of the year ("L-shaped" development), the Group expects EBIT of at least US$ 6.8 billion.
For 2025, the Group confirms its medium-term earnings forecast of more than US$ 8.8 billion.
Investments in profitable growth and sustainability maintained
The Group’s financial strength remains at a high level: in the second quarter of 2023, operating cash flow was at US$1.97 billion. Free cash flow was US$494 million (Q2 2022: US$731 million).
CFO Melanie Kreis said: “Even though we are keeping a close eye on our costs in the current challenging environment, our strengthened earnings power puts us in a position to continue investing significantly in future growth.
"It is precisely because supply chains are becoming increasingly complex that our customers trust us as experts in sustainable transport and logistics solutions.”
DHL Group generated total consolidated net profit after non-controlling interests of US$1.07 billion in the second quarter of 2023 (Q2 2022: US$1.65 billion). Basic earnings per share accordingly amounted to US$0.9, compared with US$1.3 in the previous year.
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