Increased income and expenses

Non-recurring items impacted profit or loss from continuing operations in both the reporting year and the prior year. In the year under review, the repayment awarded in the state aid proceedings in the amount of €572 million had a positive impact on earnings. However, the announced withdrawal from the domestic US express business has already reduced earnings by €2,117 million. An impairment test led to a loss totalling €610 million on the goodwill of SUPPLY CHAIN/CIS. In addition, we discontinued use of the Exel brand, which was written off in full in the amount of €382 million. Non-recurring expenses of €440 million were also incurred for restructuring activities in other divisions. In 2007, the sale of Vfw AG generated non-recurring income of €59 million. Earnings for 2007 were reduced by €594 million due to the impairment loss on the assets of the express business in the Americas region.

Other operating income increased from €2,343 million to €2,736 million, primarily due to the repayment received in the state aid proceedings.

The drastic rise in oil prices in the first half of the year made transport and aircraft fuel more expensive. This was a significant factor in the increase in our materials expense from €30,703 to €31,979.

Staff costs increased by 4.8% to €17,990 million, due largely to restructuring activities.

Deprecation, amortisation and impairment losses increased by €466 million to €2,662 million, up from €2,196 million in the prior year. The year under review was impacted above all by the write-down on goodwill and the Exel brand. In 2007, negative effects were mainly due to the impairment losses on non-current assets of the express business in the Americas region.

The increase in other operating expenses of €961 million to €5,146 million was primarily the result of the aforementioned restructuring activities.

Non-recurring charges reduce EBIT from continuing operations

Profit or loss from operating activities (EBIT) from continuing operations fell by €2,700 million from the previous year’s figure of €2,133 million to € –567 million. In the reporting period, EBIT from continuing operations contained income of €572 million from the state aid proceedings, restructuring costs of €2,557 million and impairment losses of €992 million. The prior-year figure included non-recurring income of €59 million from the sale of Vfw AG and an impairment loss of €594 million on the express business in the Americas region. Adjusted for these items, EBIT fell by 9.7% to €2,410 million.

Net finance costs improved by €446 million to €499 million (previous year: €945 million). This was due in particular to the interest component of the repayment we received from the state aid proceedings.

Profit or loss before income taxes from continuing operations declined by 189.7% to € –1,066 million. However, income tax increased from €173 million to €200 million. Profit or loss from continuing operations thus amounted to € –1,266 million, a decline of 224.7% on the previous year.

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