By Tristan Veyet
(Reuters) -Deutsche Post suffered a slump in first-quarter operating profit amid deteriorating macroeconomic conditions, it reported on Wednesday, a day before its new chief executive takes the helm at the German logistics company.
Many companies in the sector are struggling with bloated delivery capacity, a fizzling of online sales that peaked during the pandemic and high inflation denting discretionary spending.
Bonn-based Deutsche Post (ETR:DPWGn)'s earnings before interest and tax (EBIT) dropped 24.1% to 1.64 billion euros ($1.81 billion) in the three months through March, although that exceeded analysts' consensus forecast of 1.46 billion euros.
Deutsche Post, which owns DHL, confirmed its forecast for 2023 EBIT of 6-7 billion euros as well as its outlook for 2025.
The slump in earnings comes ahead of Tobias Meyer taking over as CEO from Frank Appel, a fellow former McKinsey consultant, at the group's annual shareholder meeting on Thursday.
Meyer will have his work cut out as he said the economic downturn that weighed on first-quarter earnings continued into April.
Analysts at Stifel reiterated their "buy" rating on Deutsche Post shares, though, saying: "The company sees 'some' signs of stabilisation since March, but not yet a 'proper' recovery, which sounds nevertheless encouraging after UPS reported a deterioration in trends recently."
Peer United Parcel Service Inc (NYSE:UPS) pegged annual revenue at the lower end of its prior forecast and warned of persistent pressure on parcel volumes as it reported results below investors' expectations.
Meyer will also be called upon to decide whether Deutsche Post should make a move on Deutsche Bahn's logistics unit DB Schenker if it is put up for sale.
"There will not be any lack of courage" if an acquisition target meets Deutsche Post's criteria, Meyer said in a conference call.
Deutsche Post's stock was 0.82% higher at 1028 GMT.
($1 = 0.9071 euros)