Management of financial risks
Information on financial risk management is provided in the Notes.
Risks from pending legal proceedings
Information on legal risks is provided in the Notes.
Other risks
The US Department of Transportation (DOT) has not yet completed a US citizenship test for ABX Air Inc. ABX Air Inc. is an independent company that provides transport services for DHL. There is no deadline for the routine citizenship test by the DOT. ABX advises that it expects a positive outcome of this test that will confirm that it is a US airline pursuant to US laws and DOT regulations. A similar review of ASTAR Air Cargo Inc. was decided positively by the DOT in 2003/2004.
External audits are currently underway at DHL Express (USA) and Airborne Inc. in line with the US unclaimed property laws. These laws state that abandoned assets must either be returned to their rightful owner or transferred to the last known owner’s home state or, if this is not known, to the state in which the company is domiciled.
In the course of its expansion, the Group has recognised significant goodwill. According to IAS 36, this goodwill must be subjected to an impairment test at least once a year. If the value of the goodwill is determined to be impaired, an impairment loss must be recognised.
Our insurance strategy separates insurable risks into two groups. The first group comprises risks with a high probability of occurrence and low individual cost. These risks are insured via a captive, an insurance company owned by the Group. The in-house company is able to insure such risks at a lower cost than commercial insurers. The second group comprises risks that have a low probability of occurrence but could entail high losses, such as air transport risks. These risks are transferred to commercial insurers. This global financing and insurance strategy produced cost savings approaching €100 million during the year.
The threat of terrorist attacks could also have negative effects on our business and particularly on our air-based express operations. Higher insurance premiums cannot be ruled out in such an eventuality.
As a service provider, we do not conduct research and development in the narrower sense. There are therefore no material risks to report in this area.
