* Q1 EBIT 726 mln eur vs RTRS poll 745 mln
* Q1 revenue 13.57 billion vs poll avg 13.61 bln
* Says hit by currency swings
* Confirms FY outlook
* Shares fall 3.2 pct vs 0.2 fall on blue chip board
(Releads, adds CEO, analyst comments)
By Marilyn Gerlach
FRANKFURT, May 15 Deutsche Post
unveiled a lower-than-expected increase in first-quarter
operating profit, as its DHL unit was hurt by customers swapping
to cheaper shipping deliveries and by currency swings in
emerging markets where it has a big presence.
Overall, freight volumes rose thanks to a recovery of the
European and U.S. economies, but operating profit missed analyst
estimates of 745 million and came in up 2.3 percent at 726
million euros ($995.38 million).
The world No. 1 postal and logistics group said revenue was
up 1.2 percent to 13.569 billion euros, below the 13,605 billion
average estimate in a Reuters poll. It took a 461 million euro
hit from swings in currencies in parts of Asia and Russia
resulting from slowing economies and political turmoil.
Shares fell 3.5 percent by mid-morning, making it the
biggest decliners on Frankfurt's blue chip board.
Dutch rival TNT Express, which leads the
intra-Europe express market, reported profit recovery in core
European segments as well as Asia, Middle East & Africa, but
also said revenues fell - by 6.6 percent in the first quarter -
owing to the impact of foreign exchange moves.
Chief Finance Officer Larry Rosen told reporters Deutsche
Post was sticking to its 2014 forecast for higher earnings,
banking on "good" growth at DHL - comprising Express, Global
Forwarding and Supply Chain divisions - despite a 1 percent
decline in quarterly operating profit to 408 million euros.
Operating profit at the Express unit rose 14.1 percent to
275 million euros, as deliveries of documents and parcels within
a 24-hour-period rose in Asia-Pacific, the Americas and Europe.
Global Forwarding operating profit declined by about 45
percent to 48 million euros due to weaker currencies against the
euro and lower prices. Forwarders buy cargo space from airlines,
shippers and truckers and bundle shipments for customers, such
as carmakers, high-tech firms and agriculture firms.
Deutsche Post said reduced freight capacities among airlines
had put pressure on rates. Air freight volumes were flat but
ocean freight volumes rose 4.7 percent largely on new business,
with exports from Europe stable and demand on the north-south
routes increasing amidst stable rates.
It said spot market rates were declining on the east-west
trade lanes, echoing comments from Swiss rival Kuehne and Nagel
whose executives told analysts last month that while
rates for the North Atlantic trade lanes were rising, the Latin
America and Far East bound lanes were weaker.
Analyst Stephen Furlong of Davy Research said volumes in air
freight had some improvement toward the end of the quarter, but
demand in the technology, engineering and manufacturing sectors
He noted also that Supply Chain, which saw a 1.2 percent
rise in operating profit, had benefited from strong gains in
emerging markets as well as in the life sciences, healthcare and
Deutsche Post said it continued to expect an EBIT increase
to between 2.9 billion euros and 3.1 billion this year compared
with 2.862 billion last year.
($1 = 0.7294 Euros)
(Reporting by Marilyn Gerlach; Editing by Sophie Walker)