The German logistics company announced a cost-saving plan after a “challenging” year in 2024. However, investors applauded fourth-quarter results.
DHL will cut 8,000 jobs in 2025 at its division called Post & Parcel Germany, which is part of a broader plan to save costs across the entire logistics group.
Post & Parcel Germany is a nationwide service in Germany and it has around 187,000 employees.
In the financial year of 2024, the division noted a 5.6% year-on-year decline in earnings before interest and taxes.
“Due to the accelerated decline in letter volumes, the adverse regulatory framework and the additional costs stemming from the tariff negotiations from 2023 and 2025, there is need for action regarding Post & Parcel Germany,” the company told Euronews Business.
The firm added that, “for that reason, we must cut around 8,000 jobs in a socially responsible manner (e.g. regular attrition) in 2025 to ensure the economic viability of the division”.
German staff representatives, the United Services Union, criticised the job cuts, saying in their statement that “the intended job cuts are the result of unfair competition promoted by politicians in a letter market that is shrinking ever faster”.
DHL were unable to offer more details on the jobs concerned. The group nonetheless emphasised that their efficiency drive would affect all units and save more than €1bn by 2027.
The German logistics group posted declining earnings for the full financial year of 2024: net profit came in at €3.3bn after the previous €3.7bn. Basic earnings per share amounted to €2.86, compared with €3.09 in 2023.
The group revenue increased by 3% year-on-year in 2024, at €84.2bn, and 6.4% to €22.7bn in the last three months of the year.
Share boost
Despite the not-so-promising figures for the entire year, investors celebrated the fourth-quarter results by sending the share price up by more than 10%.
For the final three months of 2024, the logistics company reported an operating profit (EBIT) of €1.85bn, which exceeded market expectations, and it was mainly driven by its Express segment’s performance.
Chief Executive Officer Tobias Meyer said: “2024 was marked by economic and geopolitical volatility; however, due to a strong performance in the fourth quarter, we successfully increased our revenue for the entire year.”
The company’s Board of Management and the Supervisory Board will propose an unchanged dividend of €1.85 per share at the Annual General Meeting.
DHL also increased its share buyback program by €2bn to up to €6bn and extended this until 2026.
A cautious message for 2025
Looking to the future, Meyer said: “Currently, we expect a persistently muted macroeconomic environment for 2025. Economic uncertainty and volatility are expected to continue.”
In its outlook, the company counts on reaching at least €6bn operating profit for the financial year of 2025.
“However, this outlook does not account for potential impacts from changes in tariff or trade policies, as such changes could have substantial negative and positive effects on DHL Group,” stated the company.
