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Deutsche Post lifts targets as sees ecommerce boom lasting

Mar 9, 2021

By Emma Thomasson

BERLIN (Reuters) – Deutsche Post raised its medium-term financial targets on Tuesday after beating its forecasts for 2020, predicting the boom in ecommerce driven by the coronavirus pandemic will continue and world trade will gradually recover.

Deutsche Post DHL, one of the world’s biggest logistics companies, expects operating profit to increase to more than 5.6 billion euros ($6.6 billion) in 2021, and to more than 6.0 billion in 2023, after a 17% rise to 4.8 billion in 2020.

Ecommerce growth will probably return to a more normal level in 2021, albeit from a higher base, finance chief Melanie Kreis told analysts, but that should be offset by a recovery in global trade and shipments by business customers.

People have continued to shop more online than before the pandemic in countries where coronavirus lockdowns have already been lifted, noted Chief Executive Frank Appel: “Older people are now used to that and have seen the convenience.”

Deutsche Post’s 2020 revenue rose 5.5% to 66.8 billion euros, just shy of analysts’ average forecast of 67 billion.

Its shares, up 6% this year, were 0.5% higher at 0859 GMT.

Appel predicted the company would continue to gain market share, noting rival UPS was focused on increasing profits rather than growing in size and FedEx was busy integrating the network of European operator TNT Express.

He expects parcel volumes from Amazon to continue to decline as the ecommerce giant builds up its own logistics network, but that loss is being made up by faster growth from medium-sized companies as more retailers sell online.

The German group said on Monday it would buy back up to 1 billion euros of shares in the year starting from this month, and said it would propose a dividend of 1.35 euros per share for 2020, up from 1.15 euros in 2019.

($1 = 0.8432 euros)

(Reporting by Emma Thomasson. Editing by Thomas Escritt and Mark Potter)