DHL 1998 Annual Report Download - page 18

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Business development in 1998 –
Further improvement in revenue and business volume
Total group revenue grew by DM 1,049 million to DM 28,689 million in
1998, an increase of 3.8 per cent over the previous year. Revenue generated
by Deutsche Post AG totaled DM 27,872 million. The Letter Services
division generated DM 19,621 million of total group revenue, the largest
share by far. Some DM 19,532 million of this amount was generated by
Deutsche Post AG. All business segments – letter mail, advertising mail,
press items mail – reported a marked year-on-year increase. Revenue
generated by the Parcel Services/Express/Logistics division rose to DM 4,803
million (DM 4,539 million of which was generated by Deutsche Post AG).
The International Mail division reported DM 2,315 million in revenue
(with DM 2,172 million attributable to Deutsche Post AG) and the Retail
Branches/Financial Services division posted revenues of DM 1,829 million
(with DM 1,453 million being generated by Deutsche Post AG).
The picture for sales volume is equally positive, with the total number
of items and transactions (effected at our postal retail outlets) increasing by
4.6 per cent to 23,386 million items (for Deutsche Post only). Parcel mail
volume in particular saw above-average growth.
Strong increase in profits
Profit on ordinary activities topped the DM billion mark for the first time
in 1998. Posting DM 1,276 million for the year, we improved our profit
by 68 per cent over 1997 (DM 758 million).Our systematic implementation
of cost-reduction measures was a particularly strong factor in increasing
our profit. A further contributing factor was the continued improvement
in our revenue situation.
Although costs incurred for materials rose by 19.3 per cent to DM 4,436
million, we were able to reduce personnel expenses by 0.7 per cent to
DM 19,677 million. The increase in our costs for materials was due
primarily to the increased cost of purchased services.
Our extraordinary charge for the year was –DM 591 million, primarily
due to an additional transfer to accruals for pension obligations. Follow-
ing taxes (DM 367 million), net income for the year was DM 318 million,
compared to –DM 402 million in 1997.
14
Profit on ordinary activities
in DM mil.
1995 1996 1997 1998
282 643 758 1,276
1,250
1,000
750
500
250
Group Management Report