Organisational adjustment
In the fourth quarter of 2008, the sale of Postbank will also be reflected in our organisational structure.
Continuation of ongoing investment projects
Our plans for capital expenditure in the fourth quarter of 2008 primarily involve continuing the investment projects begun during the first nine months. In addition, investments are planned in the MAIL Division. The focus will be on sorting equipment in the mail centres.
Employee numbers to remain stable at year end
Our planning calls for maintaining the total number of employees at the current level until the end of 2008.
Outlook for fiscal 2008
In October, we adjusted our outlook based on the marked deterioration in the global economy in the third quarter and our expectation that it will remain difficult in the near future. The Group now expects underlying EBIT (without Postbank) for 2008 of €2.4 billion, some 10% below last year’s result and 17% less than the previous guidance. The Group had previously forecast EBIT before non-recurring effects of around €2.9 billion (without Postbank).
The principal shortfall will arise in the EXPRESS Division, which has been particularly impacted by deteriorating market conditions in the US. The Group also recorded volume shortfalls in other regions, but those could be mitigated through cost-cutting. Other divisions are likely to be slightly below previous guidance.
As is customary, our intangible assets (particularly goodwill) will be tested for impairment in the fourth quarter. In light of the difficult economic climate, an impairment (a write-down) may be necessary in the SUPPLY CHAIN/CIS Division of up to €1 billion.
Due to increasing restructuring costs of €3 billion for the express business in the USA, one-off charges between €400 million and €500 million in other businesses and possible write-downs in the SUPPLY CHAIN/CIS Division, the Group will probably see a full-year reported net loss for 2008.
Although the Group expects to make profit progress in 2009, it has chosen to withdraw its previous guidance for the year of around €3.4 billion in underlying EBIT adjusted for the deconsolidation of the stake in Postbank. It expects to issue fresh guidance when the economic prospects are sufficiently clear.