DHL's forwarding division grew third-quarter airfreight revenues 30.4% year on year to €1.5bn, with gross profit up 28.4% to €321m and volumes rising 12% to 497,000 tonnes. The express division lifted revenues 19.2% to €7bn and EBIT 50% to €1bn, aided by roughly €100m from airfreight capacity constraints. Total forwarding revenues reached €5.6bn, up 23.4%, while operating profit rose 32.7% to €259m. Rivals Kuehne+Nagel and DSV also reported airfreight gains, and DHL Group raised its full-year EBIT outlook to €7bn from €6.5bn.
According to Air Cargo News, DHL reported higher airfreight revenues, profits and volumes in the third quarter, with its express division capturing additional business from airfreight capacity constraints.
Forwarding division posts double-digit gains
The forwarding unit lifted third-quarter airfreight revenues by 30.4% year on year to €1.5bn, while airfreight gross profit rose 28.4% to €321m. Airfreight volumes climbed 12% to 497,000 tonnes.
The company attributed the volume growth to demand out of Asia, with performance further supported by higher airfreight rates. In a press release, the company said the division helped customers adapt transport routes to changing trade flows and maintain reliable supply chains.
Total forwarding revenues for the quarter increased 23.4% to €5.6bn, and operating profit reached €259m, up 32.7%. DHL said the overall growth also reflected the successful pass-through of cost and fuel inflation to customers.
Express division absorbs constrained airfreight demand
The express division reported a 19.2% rise in third-quarter revenues to €7bn, with EBIT up 50% to €1bn. DHL said capacity constraints in the airfreight market contributed around €100m to earnings.
“DHL Express benefited from a continuing gradual rise in weight transported throughout the network. Capacity constraints in the airfreight market also had a positive effect on earnings of around €100m.” — DHL
The company said the improved earnings from higher capacity utilisation were additionally supported by effective cost and yield measures. Time Definite International daily shipment weight rose 9.7% year on year as the express unit targets heavier cargo.
Earlier this year, Mike Parra, chief executive of DHL Express for Europe, told Air Cargo News that the shift to heavier shipments was partly driven by e-commerce platforms moving away from integrators toward lower-cost bulk transport and local last-mile networks, raising the share of heavier shipments.
DHL said current geopolitical unpredictability and war in Iran have helped accelerate the change, as more urgent heavier items enter the express network because of its speed, certainty and uncomplicated pricing model. To capitalise on the trend and refocus on industrial customers, DHL Express launched a Heavy Weight Express (HWX) service at the start of the year, capable of transporting shipments of up to 1,000 kg per piece and 3,000 kg per shipment.
Rivals post mixed airfreight results
Among forwarding competitors, Kuehne+Nagel recorded a 38% year-on-year rise in airfreight revenue for the quarter, with volumes up 10%. DSV saw air forwarding revenues increase 16.6% despite a 3% decline in volumes.
Market airfreight rates and volumes have been rising this year, driven by higher fuel costs, a surge in demand for data centre-related goods, overall market strength, the conflict in the Middle East and capacity tightness in certain markets, according to the report.
Earlier this year, DHL Group raised its operating profit outlook for the year on the strength of its express division and expectations for a good peak season. The group now expects full-year EBIT of €7bn, compared with its previous forecast of €6.5bn.
Source: Air Cargo News
Compiled from international media by the SCI.AI editorial team.
