Rising air freight demand and ocean freight rates bring DSV 9-month net profit to DKK 8 billion
DSV, one of the world’s largest freight forwarding companies based in Copenhagen, Denmark, more than doubled its net profit to DKK 8 billion for the 9-month period ended September 30, 2021, from 3, DKK 1 billion for the nine-month period ended September 30, 2020, on strong demand for air freight and higher ocean freight rates.
Turnover increased 44% to DKK 121 billion from DKK 84 billion, according to results announced today.
For the quarter ended September 30, 2021, operating profit (EBIT) before exceptional items increased to DKK 4.5 billion from DKK 2.7 billion a year ago. Turnover increased 77% to DKK 49.5 billion from DKK 28 billion.
The operational integration of Agility’s Global Integrated Logistics business, which is part of DSV in August 2021, is expected to be completed by the third quarter of 2022.
âIn August, we finalized the acquisition of Agility’s Global Integrated Logistics business and took over a well-run business and were joined by a team of new qualified colleagues,â said Jens BjÃ¸rn Andersen, Group CEO, DSV . a good start, and in the coming period our two organizations will be merged into one. Transportation markets continue to be characterized by disruptions and imbalances causing extraordinary challenges both for our customers and for us. Under extraordinary market conditions, we are pleased to report strong results across all divisions. “
DSV recorded 29% growth in air cargo volume in the third quarter of 2021 (13% YTD 2021). âAdjusted for the addition of Agility GIL, we believe DSV’s growth figures are in line with the market. Gross profit per unit (DKK) was almost stable at 8,609 and the current year edged up (2%) to 8,383.
âHigh demand, airport restrictions (COVID-19 restrictions) and limited abdominal space capacity in passenger planes continue to impact available capacity and keep fares high. The return of passenger traffic is gradually having a positive impact on capacity due to the increase in belly capacity in the market, although this is mainly relevant for regional and domestic passenger flights, and we are only waiting for a gradual return of long-haul passenger flights, âthe statement said.
DSV recorded a 12% growth in sea freight volume in the third quarter of 2021 (8% YTD 2021). âAdjusted for the addition of GIL, DSV’s volume growth has remained stable and in line with the market, according to our estimates. Securing additional capacity has been the main obstacle to acquiring new customers in 2021 as we prioritize existing customers. “
Gross profit per unit (DKK) was 4,711 in Q32021 compared to 3,036 in Q32020, an increase of 55%.
Giving outlook for the rest of the year, DSV said EBIT before special items is expected to be in the range of DKK 15.3-16 billion compared to DKK 11.1 billion through September 30, 2021.
When fully integrated, GIL is expected to contribute approximately DKK 3 billion (previously 2.8 billion) to Combined EBIT before special items on an annual basis.
DSV today announced a share buyback worth DKK 5 billion. The program will run until February 8, 2022, or earlier if finalized.
DSV also announced the expansion of its board of directors. While Jens H. Lund will be the Group COO, Michael Ebbe has been appointed the new Group CFO.
“We are strengthening the board to ensure our continued ability to grow and develop our business at a high rate,” said Thomas Plenborg, Chairman of the Board. âAt the same time, we ensure the continuity of the management team. Over the past almost 20 years, Jens Lund has been a fantastic Group CFO and has played an important role in the development of DSV. Thanks to his extensive Knowledge of the business and the logistics industry, Jens is the ideal person to lead the areas of the continued development of our IT platform and the optimization of our business. Michael Ebbe has a long history with DSV and has strong cooperation with Jens BjÃ¸rn, Jens and the rest of the executive committee. “