Last year’s capacity crunch in airfreight pushed fourth-quarter operating profits for Denmark-based transport and logistics company DSV up by 28.7 percent, year-over-year, to US$196 million, rounding out the full-year’s group operating profits, before special items, to $801 million, up 42.5 percent, y-o-y.
While business certainly picked up last year – growth in airfreight increasing 10.6 percent, sea up 6.4 percent and road 6 percent – volume gains also increased yield pressure, which has translated into a growing performance divide. In response, DSV is eager to translate their ample finances into a larger footprint, with DSV CEO Jens Bjørn Andersen saying that the company would, “start thinking more seriously” about opportunities for more mergers and acquisitions.
DSV Air & Sea posted 5.1 percent growth in gross profit in 2017 and 53.2 percent growth in earnings before interest and taxes (EBIT), and before special items. The company’s airfreight volumes grew by 10.6 percent over 2017. DSV said that, “due to the high market growth, capacity shortage was a recurring issue during 2017, especially towards the end of the year. This, in turn, caused rates to rise significantly, especially during the peak season.”
DSV’s seafreight volumes grew by 6.4 percent, which the company said was, “more or less in line with the market throughout the year.”
DSV Road posted increased gross profits of 4.5 percent in 2017, and growth of 15.9 percent in EBIT, before special items.
With the majority of its trucking business based in Europe, DSV noted that a lack of truck drivers led to capacity shortage on the continent, as 2017 progressed. “This, in turn, caused haulier rates to rise, a development that is likely to be carried into 2018,” DSV said.
Those interested in learning more about how emerging technologies will impact the airfreight industry are invited to join us at Cargo Facts Asia 2018 in Shanghai 23-25 April at the Mandarin Oriental Pudong, where a round table panel will be dedicated to the topic. For more information, or to register, visit www.cargofactsasia.com