Deutsche Post Announces Record Sales and Profits
The semi-privatized company announced the figures yesterday at its annual press conference in Bonn, Germany, detailing financial and other results.
Sales were up 46 percent over 1999, while pre-tax profits jumped 158 percent to 2.38 billion euros. After-tax earnings rose 48 percent to 1.53 billion euros ($1.4 billion).
CEO Klaus Zumwinkel said he expects first-quarter results to show a modest increase in sales, thanks to new acquisitions and "organic growth" in all major sectors -- express, logistics, financial services and international business. He said this growth should continue throughout 2001.
"After reorganizing our domestic business and globalizing the company, we are entering phase three of our strategy -- to make Deutsche Post World Net the number one global player in the logistics sector," he said. "We now have a new international business platform which will be the basis of company growth in the coming years."
Last year's results, Zumwinkel said, showed DP's transformation into an international logistics company.
In 1999, logistics, express courier and financial services contributed 51 percent of total sales, while last year their share of sales rose to 66 percent. They accounted for 26 percent of profits versus 8 percent in 1999.
The company's monopoly letter service almost doubled profits, from 1.01 billion euros in 1999 to 2 billion euros last year.
A major reason for the increase was sharply lower pension costs because of legal changes. Therefore, these lower payments will continue. But DP also said it maintained letter dominance despite increased competition and wider use of electronic services.
Express-service sales grew 26 percent to 6.02 billion euros, with profits up 27 percent to 76 million euros. The company conceded that much of the increase resulted from taking over full control of DHL International.
Growth in logistics, where Deutsche Post was a bit player only three years ago, rested on integration of the Danzas Group, a Swiss freight forwarder bought in the late '90s, as well as the acquisition of Air Express International in the United States and ASG in Sweden.
Financial services showed the strongest growth, up 178 percent to 8 billion euros, an expansion largely due to the integration of the postal bank into the company. The bank has 10 million customers and savings deposits of 31 billion euros.
While yesterday's announcement did not pull out U.S. results, Deutsche Post has invested heavily here and owns half a dozen companies, including Global Mail and Yellowstone, which are being integrated into the World Net brand.