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Deutsche Post shares jump after strong results

BERLIN (Reuters) - Shares in German logistics group Deutsche Post AG DPWGn.DE jumped on Wednesday after it reported a 16% rise in second-quarter operating profit and said it would pay its employees a bonus for their efforts during the coronavirus crisis.

FILE PHOTO: Frank Appel, Chief Executive Officer of German postal and logistics group Deutsche Post DHL, poses for a picture before the company's annual news conference in Troisdorf near Bonn, Germany March 10, 2020. REUTERS/Wolfgang Rattay/File Photo

Deutsche Post DHL, one of the world’s biggest post andfreight companies, has been handling a big increase in parcel shipments during the pandemic, although its global freight business has been hit by the slowdown in the world economy.

In an unscheduled release on Tuesday, Deutsche Post said preliminary figures showed that its quarterly operating profit came in at around 890 million euros ($1 billion), beating average analyst forecasts for 811 million, according to Refinitiv data.

Deutsche Post shares rose 1.8% in early trade. The stock has now recovered all of the ground it lost during the early weeks of the coronavirus pandemic.

DHL express volumes have been growing again in July as the European and Asian economies recover, Chief Executive Frank Appel told journalists, adding he did not expect big rise in infections due to social distancing and mask wearing.

“We are moderately optimistic for the future,” he said.

Deutsche Post now expects full-year operating profit to come in at between 3.5 billion and 3.8 billion euros, including the payment of a one-time bonus to staff totaling around 200 million euros, to be accounted for in the third quarter.

Deutsche Post adjusted its medium-term guidance to say it now only expects to reach its target for operating profit of 5.3 billion euros by 2022 if the global economy rebounds quickly. If there is no broad-based recovery, it expects 4.7 billion.

It also proposed a dividend of 1.15 euros per share, the same as last year. It releases full-year results on Aug. 5.

($1 = 0.8870 euros)

Reporting by Emma Thomasson; Editing by Louise Heavens