The COVID-19 outbreak keeps fueling e-commerce, apparently also on a long-term basis. Online order volumes surged during the first strict lockdown phase in spring 2020. The demand in e-commerce also remained high throughout the summer and until today. Even though offline shopping was possible almost like before the crisis, the trend towards online shopping is unbroken. As a consequence, logistics companies, who have to process and fulfill the enormous amounts of orders, are beating record after record, both in fulfilled orders and in revenue.
German logistics company DHL keeps adjusting their operating income expectations upwards. DHL raised their full fiscal 2020 guidance from an operating income of €3.5 to €3.8 billion in the Q2 2020 report to between €4.1 billion and €4.4 billion in the Q3 2020 report. Recently, the Deutsche Post DHL Group celebrated the strongest first quarter in history. Revenues increased by 22% compared to Q1 2020, reaching a total of €18.9 billion. This is almost as high as the Q4 2020 revenue, which includes the unprecedentedly strong holiday season.
Delivering 489 million parcels in Germany
In the German market only, DHL delivered around 489 million parcels in the first three months of 2021 – a volume again comparable to holiday quarter Q4 2020. In the full year 2020, the amount of parcels delivered by DHL in the German market increased by 15% year-on-year. Revenue developments for many other parcel deliverers are similar. UPS registered an even higher Q1 year-on-year growth of 27%. The COVID-19 effect on parcel delivery services is also visible when looking at the whole year 2020:
UPS registered the highest growth
When taking a look at revenue developments of selected strong global logistics companies in 2020, UPS registered the highest growth. Revenues increased by an impressive 14% compared to 2019 and reached US$84.6 billion. Deutsche Post DHL recorded the second highest growth and also the second highest total revenue in 2020. The Group increased revenues by 7% year-on-year, reaching a total of US$76.2 billion.
FedEx decreased in revenue
United States Postal Service also increased revenues, but not as strong as UPS and DHL. 2020 revenue of USPS was 3% higher than in 2019, namely US$73.1 billion. The only logistics group in this comparison which registered a decrease in revenue is FedEx. Revenues fell by 1% from US$69.7 billion in 2019 to 69.2 billion in 2020. According to company executives, COVID-19 hit especially hard on the company’s commercial shipment volumes as many businesses were in lockdown. FedEx Ground, the group’s residential delivery service, boomed but could not compensate the losses made in B2B shipments.
Given the strong fiscal year 2020 and first quarter results, most logistics companies have adjusted their 2021 guidance. DHL announced that they now expect a group EBIT of more than €6.7 billion for 2021, raising the initial 2021 EBIT forecast of more than €5.6 billion substantially. Also the medium-term EBIT forecast was raised from initially over €6 billion to over €7 billion in 2023. We are thus likely to see more record-braking news from global parcel deliverers in the near future.