Finance
DHL posts weakened free cash flow for Q3, denting shares
Published by Jessica Weisman-Pitts
Posted on November 5, 2024
2 min readLast updated: January 29, 2026
Global Banking & Finance Review®
Company
Published by Jessica Weisman-Pitts
Posted on November 5, 2024
2 min readLast updated: January 29, 2026
By Chiara Holzhaeuser
(Reuters) -DHL reported third-quarter free cash flow well below market expectations on Tuesday, in another hit to its shares that have lost nearly a fifth of their value this year.
The German logistics giant last week lowered its full-year and mid-term forecasts, citing a weaker macroeconomic environment in Europe and low business-to-business mail volumes, as it pre-announced its operating earnings for the quarter.
DHL’s shares were down 2.5% by 0915 GMT.
A local trader said the free cash flow of 723 million euros ($787.2 million) was underwhelming, falling 32.7% from last year and missing a consensus estimate of 984 million euros.
DHL is in a growth phase, particularly in its global freight forwarding business, which requires higher working capital and thus impacts cash flow, Chief Financial Officer Melanie Kreis said in a press call.
While the company’s revenue grew by 6.2% in the quarter, its net profit fell 6.9% to 751 million euros, missing analysts’ forecast of 787 million euros in the company-compiled consensus.
DHL’s Post & Parcel Germany division saw letter volumes fall while staff and energy costs “literally exploded”, explaining the divisional drop in quarterly profits, CEO Tobias Meyer said in an interview published on the company’s website on Tuesday.
He also commented on the recent decision by the Federal Network Agency to allow DHL to raise postage prices, saying the granted increases were insufficient.
“We had expected a proposal that would consider inflation and the decline in letter volumes,” Meyer told reporters in the call, adding Germany was the only European country where letter costs had risen more slowly than inflation.
($1 = 0.9184 euros)
(Reporting by Chiara Holzhaeuser in Gdansk; editing by Milla Nissi)
Free cash flow is the cash generated by a company after accounting for capital expenditures. It indicates how much cash is available for distribution to investors or for reinvestment in the business.
Net profit is the amount of money that remains after all expenses, taxes, and costs have been subtracted from total revenue. It is a key indicator of a company's profitability.
Operating earnings refer to the profit a company makes from its core business operations, excluding any income derived from non-operational activities such as investments or sales of assets.
The macroeconomic environment refers to the overall economic conditions affecting a country or region, including factors like inflation, unemployment rates, and economic growth, which can impact business performance.
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