DPWN hit after US DHL restructuring
The restructuring of DPWN's DHL US Express business has hit the German giant's reported earnings before interest and tax (EBIT) hard, according the conglomerate's latest results.
In May, DPWN opened talks with rival US express courier UPS over a planned airlift agreement that would allow DHL's American arm to cut costs to the tune of a billion dollars in 2011. The company indicated that negotiations with UPS are "making progress".
Underlying EBIT, on the other hand, rose by 12% to US$2.9 billion during the first half, despite what the operator termed as "challenging economic conditions".
"Our healthy operating performance in the first half demonstrates that a well-balanced portfolio like ours and a global presence can show more resilience to an unfavourable economic environment," said Frank Appel, CEO of DPWN.
A further headache for the company has been the political ramifications of a decision that may see 8000 workers at DHL's Wilmington air hub lose their jobs.
Given Wilmington's location in a swing state (Ohio), in a presidential election year, the move has become something of a cause celebre for the two candidates vying for the presidency, Barack Obama and John McCain, who have both opted to visited the town recently.