Frankfurt am Main: German logistics giant and DHL owner Deutsche Post on Friday lowered its targets for 2018 as it announced sweeping cost cuts to make its post and parcels division more profitable.
The group said it now expects full-year operating profits before interest and tax to reach 3.2 billion euros ($3.7 billion), compared with an earlier estimate of 4.15 billion, after a disappointing first quarter. Deutsche Post’s packages and ecommerce unit is predicted to contribute just some 600 million euros to the revised 2018 figure, well below the 1.5 billion it was originally forecast to add to earnings.
Deutsche Post said it would launch a series of measures “to counteract the decline in profitability in the post-ecommerce-parcel division”.
The announcement sent Deutsche Post shares plummeting 7.5 per cent to 30.23 euros in afternoon trading, making it by far the worst performer on the Dax index of blue-chip German stocks. Deutsche Post said it will book a one-off charge of 500 million euros this year because of the planned restructuring.
— AFP
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