Frankfurt-based international logistics provider Dachser released its 2018 results, which show the company managed to grow its business overall, compared to 2017, despite its lagging Air & Sea segment.
The company increased consolidated net revenue by 5.5% to US$6.58 billion. It also increased its shipment “numbers” by 2.5% and its tonnage by 3%, year-over-year.
However, any growth was no thanks to its Air & Sea segment, the performance of which the company described as “volatile” over the year. Consolidated net revenue within the segment stagnated at around $1.33 billion. Shipments decreased by 2.9%, but the decline was somewhat offset by a 6.6% tonnage growth in sea freight.
Dachser pointed to a combination of factors, including exchange-rate effects, decreasing freight rates, trade tensions, and a downturn in volume on its China-Europe route to explain the weak performance of the segment.
“By 2018, it was clear that logistics had to focus on the discipline of scarce resources management,” said Bernhard Simon, CEO Dachser SE.
It is worth noting that it is difficult to judge the true health of its business, as the company did not release any net income figures for any segment in its results. But its other areas of business, namely Road Logistics, Food Logistics, and European Logistics each attained consolidated net revenue growth, of 6.6%, 5.3% and 7.0%, respectively.
Its U.S. arm also grew substantially – increasing revenue by 11.9% to $221 million in 2018. It plans to expand its network in the Americas region by another 12-14% next year.
“We had a strong fourth quarter as a result of companies planning their shipments ahead of the scheduled Q1 2019 tariffs,” said Guido Gries, managing director, Dachser Americas. He added that the opening of its Detroit office in 2018 and its offices in Minneapolis and Baltimore in recent years also contributed to this growth.
Simon believes that key to reviving its lagging Air & Sea segment “lies in mastering and managing complex interfaces and the deep integration of our logistics systems.”
Investing in digital infrastructure is part of the company’s continued growth strategy. By 2020, the company aims to replace its current system with a new transport management system (TMS) that it developed in-house. In 2018, it completed the rollout of the system in China, which it will spread throughout its network.
“As we have seen with European overland transport, our investments in integration and standardization will pay off here, too,” he added.1 - Reader Likes This Post