D. Post meets targets

August 21, 2001 Posted: 1152 GMT

LONDON (CNN) -- Europe's largest postal service provider, Deutsche Post, reported a slight drop in first-half net profit as it struggled with growing competition.

Germany' state-controlled postal and transport group said net profit for the six months ended June 30 was 1.04 billion ($1 billion), down from 1.1 billion a year earlier.

Earnings per share were 0.94, falling slightly from last year's 0.98, as the company paid more tax, losing the benefit of earlier tax losses.

Deutsche Post, which was partially privatised in November, said first-half earnings before interest, tax, and amortisation (EBITA) rose 5.5 percent to 1.41 billion ($1.29 billion), from a restated 1.34 billion a year ago, as sales rose 7 percent to 16.8 billion.

The EBITA figure was in line with market expectations, Reuters news agency reported.

The German post office operator has diversified into express parcel deliveries and transport services to cushion the impact of new competition, following the opening-up of the European Union postal services market to new players.

The performance of the express and logistics divisions and Deutsche Post's financial services unit are seen as being key to future earnings growth.

Stiffer competition

Deutsche Post has been adding locations, services, and products in order to compete with private courier services and online delivery operators, and has built up its business through major acquisitions over recent years.

The group has become the global leader in cross-border express deliveries via its DHL International unit, Europe's largest express company.

The former monopoly, which continues to be majority owned by the German state, says its Danzas unit, which spans 150 countries, is the world's leader in air logistics and supply-chain management.

Deutsche Post shares were sold to the public in November 2000 at 21 each. Despite sinking below the issue price, the shares have outperformed the blue-chip Dax index since going public.

The stock was down 0.1 percent at 17.49 in midday trading, while the Dax was up  0.1 percent.

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