German Post Company Boosts Profits Amidst Sluggish Economic Climate
In the face of global trade conflicts and economic uncertainties, DHL Group, the renowned logistics company, has demonstrated its resilience by managing to maintain profitability and achieve earnings growth in the first half of 2024.
Despite a slight decline in revenue by 0.6% to €40.89 billion, DHL's earnings before interest and taxes (EBIT) increased by 5.1% to €2.662 billion in the same period. This impressive growth was driven by effective capacity management, structural cost improvements, and price discipline.
In the Post and Parcel Germany segment, the company employed an average of 155,000 people in the first half of the year, but this number fell to just under 152,000 by the end of the year. The decline is attributed to natural fluctuations such as retirement and job changes, with no severance payments made in the second quarter in relation to the job cuts.
DHL's Chief Financial Officer, Melanie Kreis, described the quarterly result as "good." The positive earnings development is due to the parcel business, price adjustments, and structural cost improvements. As a result, the company is on track to meet its annual EBIT forecast of at least €6.0 billion.
The express division saw a decline in volume, especially in time-definite international shipments, but increased operating profit and improved EBIT margin through capacity adjustments and cost controls. The supply chain division managed sustained earnings growth aided by yield management and cost improvements despite burdens from wage agreements and declining mail volumes. The parcel business contributed positively, stabilizing operating results.
However, DHL faced volatile volume and freight rate developments in Global Forwarding, Freight due to trade conflicts and economic weakness, which negatively affected revenue and earnings in that division. To maintain profitability, the company adjusted capacity in line with volume developments and pursued structural cost reductions.
In Q2 2025 specifically, group revenue decreased by 3.9% to EUR 19.8 billion due to exchange rate effects and slower trade volumes, but EBIT increased by 5.7% to EUR 1.4 billion with an EBIT margin improvement to 7.2%. Free cash flow improved by 7.9% year-on-year to EUR 1.1 billion in the first half of 2025, reflecting efficient cash management alongside earnings growth.
In the Post and Parcel Germany business segment, earnings before interest and taxes (EBIT) increased by around 38% to €447 million in the first half of the year. Postage rates had increased by a total of 10.5% at the start of the year, and DHL earned significantly more from shipping packages and letters in Germany in the second quarter compared to the previous year.
In conclusion, DHL's results show that despite the economic headwinds, lowered shipment volumes, and wage agreement impacts, the company improved profitability through careful capacity adjustment, cost discipline, and pricing strategies. The company is maintaining earnings growth with flat to slightly declining revenues in the first half of 2024 and the first half of 2025.
In the light of these economic uncertainties and global trade conflicts affecting various business sectors, DHL's finance department has demonstrated admirable resilience by enabling the company to not only maintain profitability but also achieve earnings growth, as shown in the first half of 2024. This growth was a direct result of strategic financial decisions, such as effective capacity management, structural cost improvements, and price discipline, across different business divisions.
