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Deutsche Post World Net Annual Report 2007
Capital expenditure
At a total of €2,210 million as at December 2007, capital expenditure (capex) was
higher than in the previous year, as illustrated by the adjacent diagram. €1,860 million
of this gure related to investments in property, plant and equipment, and €350 mil-
lion to investments in intangible assets (not including goodwill). e expenditure in
property, plant and equipment was mainly allocated to advanced payments and tangi-
ble assets under development (€349 million), to machinery and equipment (€346 mil-
lion), transport equipment (€277 million), land and buildings (€263 million) and to
IT equipment (€243 million).
To allow for a like-for-like comparison with the 2006 Group’s depreciation of assets,
the impairment loss in the EXPRESS business in the Americas region of €594 million
is to be considered as a one-time e ect lowering the total depreciation of assets gure
of €2,357 million to €1,763 million. us the respective capex versus depreciation ratio
for the EXPRESS Division would improve to 1.64 and for the Group to 1.25, gures
clearly indicating a signi cant amount of investments being allocated to the expan-
sion of the Group’s business.
Compared with the previous year, capital expenditure increased in the MAIL Division
from €253 million to €309 million. Out of the total amount, investments were pre-
dominantly made in assets related to IT equipment (€87 million), internally generated
intangible assets (€82 million), other operating and o ce equipment (€55 million) and
to machinery and equipment (€39 million).
In order to reinforce our leading position on the domestic mail market, the key ac-
tion taken in the MAIL Division consisted in modernising the network as well as
optimising the production and distribution of letters and parcels. Besides investing
in additional mail-speci c so ware, we purchased materials handling assets, hand-
held scanners and innovative machinery that will enable us to process at mail (large
letters) more cost-e ectively.
We improved the quality of service in the parcel business. About 900 Packstations
enable customers to send and collect parcels around the clock, seven days a week. We
also installed Paketboxes that allow customers to drop o franked parcels and small
packets. Sorting, franking and wrapping machines were purchased for production
purposes in the international mail business, and its information technology was
expanded.
Capital expenditure
€m
1,860 350 2,210
1,257 674 1,931
2006
2007
Property, plant and equipment
Intangible assets
(not including goodwill)
Capex and depreciation
€m
Group MAIL EXPRESS LOGISTICS
FINANCIAL
SERVICES Other/SERVICES
2006 2007 2006 2007 2006 2007 2006 2007 2006 2007 2006 2007
Capex 1,931 2,210 253 309 572 721 565 538 159 142 381 496
Depreciation on assets 1,771 2,3571) 433 432 394 1,0341) 402 423 172 163 370 305
Capex vs. depreciation ratio 1.09 0.94 0.58 0.72 1.45 0.70 1.41 1.27 0.92 0.87 1.03 1.63
1) Including the impairment loss on the non-current assets of the EXPRESS business in the Americas region of €594 million.