Deutsche Post DHL Group reported slightly lower than expected operating profit for the second quarter, with earnings at its troubled post and parcel division weighing.
Spiralling costs at the division, which has seen parcel deliveries boom thanks to eCommerce, led to the group issuing a profit warning for 2018 in June and starting a restructuring program.
The group confirmed on Tuesday that it had set aside 500 million euros for restructuring this year, mostly for an early retirement program for civil servants.
"I think we had a solid (second quarter) in line with our expectations and we have taken quite a lot of measures. We will see in the second half (of the year) the first impact from these measures but of course the major impacts will come in 2019 and 2020," Chief Executive Frank Appel told CNBC's "Squawk Box Europe" on Tuesday.
"We are providing great quality and that I think that deserves a good price as well. We are the market leader, therefore we have to do something on pricing," he added.
Above average price increases for parcel deliveries, especially for bulky items, are due to be implemented in 2019, though some price increases will start from September.
Earnings before interest and tax fell 11 percent to 747 million euros ($863 million) in the three months through June, compared with a forecast for 762 million in a Reuters poll.
Profit at the post, eCommerce, parcel division more than halved to 108 million euros from 260 million one year ago, mainly due to higher transport and staff costs.
Still, Deutsche Post confirmed its reduced targets for the year for 2018 group profit of about 3.2 billion euros and said it was on course for more than 5 billion in 2020.
