1
00:00:02,920 --> 00:00:07,320
Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

2
00:00:07,720 --> 00:00:10,840
Speaker 2: Now, DHL Group is extending its share buyback program to

3
00:00:10,880 --> 00:00:13,880
Speaker 2: twenty twenty five, with the volumes increased by between one

4
00:00:13,920 --> 00:00:17,279
Speaker 2: and four billion euros. That's after the forecast for twenty

5
00:00:17,320 --> 00:00:19,599
Speaker 2: twenty four for the company came in below the estimates.

6
00:00:19,600 --> 00:00:23,320
Speaker 2: To bus Maya, DHL Group CEO joins us now Tobias

7
00:00:23,320 --> 00:00:26,280
Speaker 2: thank you very much for your time. The forecast then

8
00:00:26,320 --> 00:00:29,200
Speaker 2: for twenty twenty four coming in slightly more conservative than

9
00:00:29,200 --> 00:00:32,120
Speaker 2: some of the analysts had expected, below the estimates. What

10
00:00:32,320 --> 00:00:35,839
Speaker 2: is behind that a relatively cautious forecast for the year.

11
00:00:36,520 --> 00:00:39,839
Speaker 1: Yeah, it is simply the relatively slow start that we

12
00:00:39,920 --> 00:00:43,000
Speaker 1: are seeing and the outlook for the coming months for

13
00:00:43,440 --> 00:00:46,400
Speaker 1: the first quarter, first half just doesn't look so bright.

14
00:00:46,960 --> 00:00:51,440
Speaker 1: That's on the macroeconomic side, but also on trade, so

15
00:00:51,840 --> 00:00:56,200
Speaker 1: we see a certain slowness. It's spottling out. So there's clearly,

16
00:00:56,560 --> 00:00:59,120
Speaker 1: you know, not the free fall that we've seen in

17
00:00:59,120 --> 00:01:01,400
Speaker 1: the middle of last year, but we are not at

18
00:01:01,400 --> 00:01:04,600
Speaker 1: a stage where we see that stimulus, particularly on the

19
00:01:04,600 --> 00:01:07,480
Speaker 1: B to B side of our business, you know, express

20
00:01:07,560 --> 00:01:11,360
Speaker 1: cargo being shipped from Asia within Europe. There's also a

21
00:01:11,400 --> 00:01:13,760
Speaker 1: lot of weakness in the B to B sector B

22
00:01:13,840 --> 00:01:16,600
Speaker 1: two C the trend very much intact again, so that's

23
00:01:16,640 --> 00:01:20,800
Speaker 1: clearly positive in our business portfolio. But the B to

24
00:01:20,920 --> 00:01:23,160
Speaker 1: B side, the recovery seems to be slower.

25
00:01:23,600 --> 00:01:25,800
Speaker 2: What does that mean then to the outlook for volumes

26
00:01:25,800 --> 00:01:26,560
Speaker 2: then tobias.

27
00:01:27,200 --> 00:01:29,840
Speaker 1: So what we have seen last year on the volume

28
00:01:29,920 --> 00:01:33,520
Speaker 1: side is a drop, particularly on the affreight also on

29
00:01:33,560 --> 00:01:36,800
Speaker 1: the air express side. That came from the highs of

30
00:01:36,840 --> 00:01:40,000
Speaker 1: the pandemic. So that is also very clear and we

31
00:01:40,080 --> 00:01:43,560
Speaker 1: anticipated that that on the rate side particularly we would

32
00:01:43,560 --> 00:01:47,440
Speaker 1: see a decrease again, so that is no surprise. But

33
00:01:47,560 --> 00:01:50,040
Speaker 1: the volume on the B to B side, that is

34
00:01:50,120 --> 00:01:53,720
Speaker 1: what is softer than we originally expected. Towards the end

35
00:01:53,760 --> 00:01:57,560
Speaker 1: of the year. Also into this year, the B to

36
00:01:57,640 --> 00:02:00,720
Speaker 1: B trading is not really picking up. So this is

37
00:02:00,800 --> 00:02:03,560
Speaker 1: what's making us a bit cautious at least for the

38
00:02:03,600 --> 00:02:05,480
Speaker 1: first half of this year. OK.

39
00:02:05,600 --> 00:02:07,680
Speaker 2: And you talk about the trade slowness that you're saying,

40
00:02:07,680 --> 00:02:10,400
Speaker 2: you say, it's not as pronounced as it was last year.

41
00:02:10,720 --> 00:02:13,200
Speaker 2: You think maybe it's starting to bottom. Where is that

42
00:02:13,240 --> 00:02:15,880
Speaker 2: Where is it most pronounced though, in terms of the slowdown.

43
00:02:15,480 --> 00:02:18,600
Speaker 1: In trade, So we do see some weakness intro Europe

44
00:02:18,960 --> 00:02:22,520
Speaker 1: that is a bit stronger than we did expect. So

45
00:02:22,639 --> 00:02:25,880
Speaker 1: there's some contraction on B to B shipments. We see

46
00:02:25,960 --> 00:02:28,040
Speaker 1: this on the road trade side. We see it also

47
00:02:28,120 --> 00:02:31,520
Speaker 1: on our express offering, so it is probably broad the

48
00:02:31,560 --> 00:02:36,040
Speaker 1: European weakness in trading. There's also the trades out of China,

49
00:02:36,080 --> 00:02:39,760
Speaker 1: for instance, towards the US that is something we've seen

50
00:02:39,800 --> 00:02:42,840
Speaker 1: for a while now. So these are the main two

51
00:02:42,919 --> 00:02:45,600
Speaker 1: spots where our expectations for the last months have not

52
00:02:45,680 --> 00:02:47,920
Speaker 1: been met, and I think we just need to wait

53
00:02:47,960 --> 00:02:51,079
Speaker 1: a bit longer until the interest rate hike is absorbed

54
00:02:51,120 --> 00:02:54,400
Speaker 1: by the broader economy. We see some more activity also

55
00:02:54,600 --> 00:02:59,360
Speaker 1: in the real estate sector, which obviously influences, especially in Asia,

56
00:02:59,480 --> 00:03:02,760
Speaker 1: consumer confidence as well. So this is the part that

57
00:03:03,040 --> 00:03:07,320
Speaker 1: is lacking expectations. Again on the B to C side,

58
00:03:08,000 --> 00:03:12,160
Speaker 1: our e commerce business doing quite well. Structural trend intact,

59
00:03:12,360 --> 00:03:13,200
Speaker 1: that's the positive.

60
00:03:13,480 --> 00:03:16,880
Speaker 2: Okay, And you're announcing a share buyback program to be

61
00:03:16,919 --> 00:03:20,400
Speaker 2: increased to four billion euros. Four billion euros is the target?

62
00:03:20,440 --> 00:03:22,520
Speaker 2: Is there more you can do in terms of returning

63
00:03:22,560 --> 00:03:23,480
Speaker 2: cash to shareholders?

64
00:03:23,800 --> 00:03:27,040
Speaker 1: So we have good ways to deploy capital. We also

65
00:03:27,120 --> 00:03:31,240
Speaker 1: want to definitely continue investing, especially in our e commerce business,

66
00:03:31,480 --> 00:03:34,200
Speaker 1: so that's an area which provides structural growth. We want

67
00:03:34,240 --> 00:03:37,120
Speaker 1: to be part of that. We want to grow that

68
00:03:37,600 --> 00:03:42,280
Speaker 1: in our shipping activities, last mile activities, but also beyond

69
00:03:42,320 --> 00:03:46,040
Speaker 1: that on the warehousing site returns. So these are areas

70
00:03:46,040 --> 00:03:48,880
Speaker 1: that we interested. We obviously want to continue to invest

71
00:03:48,880 --> 00:03:53,640
Speaker 1: in our express business, which is quite capital intensive, so

72
00:03:53,680 --> 00:03:57,000
Speaker 1: we have different ways to deploy capital. Also, smaller M

73
00:03:57,080 --> 00:03:59,600
Speaker 1: and A is something that we're looking for up to

74
00:03:59,680 --> 00:04:03,680
Speaker 1: mids preferably, so we have good ways to deploy capital.

75
00:04:03,720 --> 00:04:05,280
Speaker 1: Share buy BEG is only one of them.

76
00:04:05,520 --> 00:04:07,320
Speaker 2: Well, you talk about M and A really interesting because

77
00:04:07,400 --> 00:04:10,640
Speaker 2: Deutsche Band, which of course is Germany's national railway company,

78
00:04:10,680 --> 00:04:13,840
Speaker 2: looking potentially to sell at Schenker Logistics unit at one

79
00:04:13,840 --> 00:04:17,560
Speaker 2: point valued at twenty billion euros DHL reportedly in the

80
00:04:17,600 --> 00:04:19,800
Speaker 2: mix in terms of offers, Have you made a firm

81
00:04:19,839 --> 00:04:20,800
Speaker 2: offer for that business?

82
00:04:20,839 --> 00:04:24,919
Speaker 1: Devis no, we haven't even indicated interest. So that's the

83
00:04:25,000 --> 00:04:29,160
Speaker 1: news that wasn't quite accurate. We didn't indicate an interest.

84
00:04:29,200 --> 00:04:32,320
Speaker 1: Early January when that was due, we looked at it.

85
00:04:32,680 --> 00:04:36,040
Speaker 1: You know, it's a wedding that is supposed to happen.

86
00:04:36,480 --> 00:04:39,039
Speaker 1: We are not going to be the husband. As I

87
00:04:39,160 --> 00:04:42,440
Speaker 1: laid out, we just have other more attractive ways in

88
00:04:42,480 --> 00:04:45,360
Speaker 1: our mind to deploy capital of our shareholders, and that's

89
00:04:45,360 --> 00:04:46,440
Speaker 1: what we're going to focus on.

90
00:04:46,800 --> 00:04:48,480
Speaker 2: So, Okay, you're not going to be the husband in

91
00:04:48,520 --> 00:04:50,320
Speaker 2: that matter. So to be clear, advice, you are not

92
00:04:50,440 --> 00:04:52,960
Speaker 2: interested in shanking, you're not going to be making an

93
00:04:52,960 --> 00:04:54,800
Speaker 2: offer for that business.

94
00:04:54,839 --> 00:04:57,200
Speaker 1: Correct, wasn't interested? Aren't interested?

95
00:04:58,640 --> 00:05:01,160
Speaker 2: Okay, when it comes to the red See crisis, what

96
00:05:01,240 --> 00:05:02,320
Speaker 2: impact are you seeing there?

97
00:05:02,320 --> 00:05:08,560
Speaker 1: Tobias? So we do see obviously the concern around the

98
00:05:08,600 --> 00:05:11,599
Speaker 1: impact it has on this shipping route, the physical danger

99
00:05:11,760 --> 00:05:18,880
Speaker 1: to merchandise to merchant ships. Most shipping lines currently choose

100
00:05:18,920 --> 00:05:21,560
Speaker 1: to go around the Cape of Good Hope, adding ten

101
00:05:21,640 --> 00:05:24,440
Speaker 1: to twelve days to the voyage. That obviously has a

102
00:05:24,520 --> 00:05:27,159
Speaker 1: challenge in some supply chains, but it doesn't have the

103
00:05:27,200 --> 00:05:30,680
Speaker 1: same impact then we had during the pandemic where the

104
00:05:30,760 --> 00:05:34,359
Speaker 1: overall demand supply balance was very tight. That's not the

105
00:05:34,400 --> 00:05:37,279
Speaker 1: situation we're currently in an ocean shipping so it has

106
00:05:37,320 --> 00:05:41,200
Speaker 1: some impact definitely something that we need to work with

107
00:05:41,240 --> 00:05:44,719
Speaker 1: our customers to ensure that critical cargo is there on

108
00:05:44,800 --> 00:05:47,839
Speaker 1: time and we don't have supply chain disruptions but it

109
00:05:47,880 --> 00:05:50,920
Speaker 1: doesn't have that macro impact on rates that we've seen

110
00:05:51,000 --> 00:05:51,840
Speaker 1: during the pandemic.

111
00:05:51,880 --> 00:05:55,160
Speaker 2: With other disruptions and closer to home Germany seeing a

112
00:05:55,279 --> 00:05:57,840
Speaker 2: number of train driver strike, seeing some disruptions from the

113
00:05:57,880 --> 00:06:01,040
Speaker 2: airports there. How is that impacting your business? How you

114
00:06:01,160 --> 00:06:02,599
Speaker 2: navigating that challenge?

115
00:06:02,960 --> 00:06:06,559
Speaker 1: Yeah, well it is an interesting environment. We have more

116
00:06:07,040 --> 00:06:10,080
Speaker 1: labor actions, I think than we have seen for a

117
00:06:10,120 --> 00:06:13,280
Speaker 1: long long time, not only here in Germany but across

118
00:06:13,640 --> 00:06:16,640
Speaker 1: I think it's driven by the high inflation that objectly

119
00:06:16,760 --> 00:06:20,400
Speaker 1: impacted real wages for many folks. So it is an

120
00:06:20,440 --> 00:06:23,359
Speaker 1: area of concern, but we have managed so far, I

121
00:06:23,400 --> 00:06:26,320
Speaker 1: think pretty well. We have to deal with it. There

122
00:06:26,360 --> 00:06:30,160
Speaker 1: are certain disruptions on the mode of transport, also strikes

123
00:06:30,160 --> 00:06:33,400
Speaker 1: of farmers blocking highways and so forth. It is obviously

124
00:06:33,440 --> 00:06:37,000
Speaker 1: not helping. It's a challenge, an everyday challenge for operational

125
00:06:37,040 --> 00:06:40,640
Speaker 1: folks to keep cargo moving. But that's what we're there for,

126
00:06:40,720 --> 00:06:44,120
Speaker 1: that's our job. So it's a challenge that we're up to.

127
00:06:44,120 --> 00:06:47,279
Speaker 2: Tobias Mayor, DHL Group CEO. On the back of those earnings,

128
00:06:47,279 --> 00:06:48,560
Speaker 2: with the outlook for the rest of the year, thank you

129
00:06:48,600 --> 00:06:49,440
Speaker 2: so much for your time.