Analytiqa: Logistics Bulletin: Friday 03rd August

This week’s Logistics Bulletin reports on financial results, contract wins and losses and M&A activity. At DPWN, the Logistics division, which now employs over 162,000 people, continued to grow during the first six months of the year. Revenue climbed by 6.7% to €12,506.0 million. In the DHL Global Forwarding business unit, revenue remained stable at €4,468.0 million, whilst at DHL Exel Supply Chain, the positive trend that started in the first quarter continued in the second. Revenue climbed by 12.8%, to €6,412.0 million. Elsewhere, TDG, Geodis and DSV have all reported first half results for 2007.

Consolidation amongst logistics service providers across the sector continues. In road transport, Schenker plans to takeover of Spain-TIR, DSV have announced a series of talks with possible targets, TDG will target acquisitions in specialised sectors and CEVA Logistics announced that EGL is now a wholly owned indirect subsidiary of CEVA.

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DHL Exel Supply Chain increase H1 revenue to €6.4 billion

03 August 2007 - For the first half of 2007, Deutsche Post World Net (DPWN) has reported an increase in consolidated revenue of 5.4%, to €30,909.0 million, as EBIT rose by 9.0% to €1,701.0 million. Earnings growth was attributed to the Group’s Express and Logistics divisions.

During the first half of 2007, the Express division raised revenue by 2.0%, to €6,754.0 million, thanks to volume growth in both the domestic and international business. Express now accounts for 20.5% of Group revenues. However, because more than half of the revenue was generated in countries outside Europe, the division experienced negative currency effects of €223.0 million. In local currencies, organic revenue growth of 6.2% was achieved. In Europe, the division boosted both revenue and shipping volumes. In the Americas region, revenue rose 3.6% in terms of local currency, driven once again by the strong business in Latin America. In the US, 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 €161.0 million, compared with €19.0 million in the same period last year. Profitability improved considerably in all regions.

The Logistics division, which now employs over 162,000 people, continued to grow during the first six months of the year. Revenue climbed by 6.7% to €12,506.0 million. Excluding negative currency effects and inorganic factors like the sale of the waste-disposal company Vfw AG, revenue grew by 9.2%. Logistics now accounts for 37.9% of Group revenues.

In the DHL Global Forwarding business unit, revenue remained stable at €4,468.0 million in the face of negative currency effects. Air freight volumes increased by 9.0% in H1, although revenue dropped by 4.3%. However, lower freight rates on key trade lanes saw costs decrease even more. Air freight revenue in H1, 2007, at €2,341.0 million, accounts for 52.4% of the DHL Global Forwarding business unit. Air freight tonnage increased by 9.0%. Sea freight revenues, up 12.3% to €1,400.0 million, account for 31.3% of the business unit’s revenues. Container numbers increased 16.1% in H1, 2007.

At DHL Exel Supply Chain, the positive trend that started in the first quarter continued in the second. Revenue climbed by 12.8% to €6,412.0 million, bolstered by the 10-year contract with the British healthcare agency NHS as well as by higher revenue in Asia.

In the DHL Freight business unit, revenue totalled €1,822.0 million, compared with €1,841.0 million in the year-ago period. EBIT for the entire Logistics division totalled €414.0 million in the first half, 28.2% 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%. Logistics accounts for 24.1% of Group EBIT.

Investment in Logistics operations has focussed upon the DHL Exel Supply Chain business, and primarily on customer-specific warehouse and transport operations. The Company has also invested in replacements for ground transport operations in the DHL Exel Supply Chain and DHL Freight businesses.

Looking ahead, DPWN still expects an underlying EBIT of at least €3,600.0 million for the entire fiscal year of 2007. In the Express division, the Group forecasts EBIT of at least €400.0 million 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 15.0%. The forecast doesn’t include the sale of Vfw AG.

Elsewhere this week:

Schenker plans takeover of Spain-TIR
2 August – Acquisition further consolidates European land transport market… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2781

DSV Air & Sea Holding establishes operations in New Zealand
2 August – Acquisition broadens network coverage in Oceania… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2783

CEVA completes merger with EGL
2 August - EGL is now a wholly owned indirect subsidiary of CEVA…(more)
http://www.analytiqa.com/newsitem.aspx?articleid=2786

Grand Alliance cooperation extended for 10 years
1 August – Offer a higher frequency of sailings in fast growing markets… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2778

DSV seeks more acquisition targets
3 August - DSV is in M&A dialogue with a number of small, medium-sized and large transport and logistics companies… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2785

Geodis report 4.1% like-for-like revenue growth in H1
31 July – LTL problems in Spain and lower high tech volumes in the Benelux and UK markets impact growth… (more )
http://www.analytiqa.com/newsitem.aspx?articleid=2782

TDG report profit growth through focus on specialised logistics
1 August - Where available, TDG will target acquisitions in specialised sectors (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2777

TNT reports strong revenue growth in Express
30 July - Operating margin of Express remained solid... (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2788

Kuehne + Nagel to provide cold chain logistics to AstraZeneca
2 August – Exports from AstraZeneca production sites in the UK, Sweden, France, Italy and Germany… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2780

CNH take parts depot operations back in-house
31 July - Cat Logistics has provided parts distribution support for the past 14 years… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2773

Newmont and Cat Logistics sign services agreement
1 August – 10-year agreement for warehousing and inventory management, records accuracy and transportation management… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2789

GEFCO opens automotive centre near Casablanca
16 July – First in Morocco to have MEAD (bonded warehouse) status… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2767

ProLogis leases logistics space to LG Electronics
30 July - Distribute consumer electronics and home appliance products across the south-eastern US… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2768

AMB Property acquires logistics space at Port of Hamburg
31 July – Main entry point and distribution hub for goods entering Germany and Eastern Europe… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2771

ProLogis leases two logistics centres in Dallas
31 July - Space to be used as a regional warehouse and distribution centre… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2774

Schneider National selects Oracle to enhance growth and efficiency
30 July - Equips the Company for significant domestic and global growth… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2775

CargoWise edi and ASM (UK) announce collaboration
30 July - Global platform fully integrating with Customs processing capabilities… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2769

Jack Holmes named President of UPS Freight
1 August - UPS Freight is the nation's fourth-largest LTL company… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2779

OH Logistics appoint Vice President of Business Development
31 July - Several key people added to support rapid growth… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2776

Pacer International announces organisational Changes
2 August - Increase product integration capabilities across business units… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2787

John Labrie named President of Con-way Freight
27 July - 17-Year Con-way veteran leads less-than-truckload company… (more)
http://www.analytiqa.com/newsitem.aspx?articleid=2770

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Analytiqa
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Contact: Editor, Logistics Bulletin

Analytiqa is a market analysis and business intelligence company providing published reports, custom research and consulting for multi-national clients across a number of industry sectors from Logistics and Distribution through to FMCG and Professional Services.

List of Key Industry Participants:

ABX LOGISTICS; BAX Global; CH Robinson; DHL Global Forwarding; EGL; Exel; Expeditors; FedEx; GeoLogistics; Hellmann Worldwide Logistics; Kintetsu World Express; Kuehne & Nagel; Maersk Logistics; Nippon Express; Panalpina; Schenker; SDV; UPS SCS; UTi Worldwide Logistics; Yusen; Wincanton; APL Logistics; TDG; Rhenus Logistics; Penske Logistics; DPWN; DHL; DHL Exel Supply Chain; Federal Express; Schneider Logistics; Schneider National; Schenker Logistics; Stinnes; Gist; Eagle Global Logistics; Menlo Worldwide; Jones Lang LaSalle; ProLogis; DTZ; Gazeley; Groupe Norbert Dentressangle; National Logistics Company; TNT; TNT Logistics; Gefco; Maersk; Geodis; GEFCO; Bibby Distribution; Global Automotive Logistics; Autologic; NYK Logistics; Dachser; DSV; Fiege; Frans Maas; Hellmann Worldwide; MOL; KWE; Kintetsu; Ewals; UPS; Ryder.

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