Q3 2024 DSV A/S Earnings Call Transcript
Key Points
- DSV AS (DSDVF) announced the acquisition of Schenker in September, with capital raised in early October to support the transaction.
- The company reported year-on-year growth in EBIT for the first time in a while, indicating a recovery from previous downturns.
- Gross profit increased by 4.8%, and EBIT rose by 1.5% in constant currencies, showcasing financial improvement.
- DSV AS (DSDVF) has narrowed its guidance range, indicating confidence in achieving higher financial targets.
- The company has seen strong growth in air and ocean freight, with air freight up 7% for the year and ocean freight up 8% for the quarter.
- The road market in Europe is challenging, with declining gross profit margins and conversion ratios due to cost pressures.
- Cost inflation, particularly in IT and software licenses, is a concern, prompting the company to initiate cost-cutting programs.
- The NEOM project is experiencing slower-than-expected ramp-up, leading to limited activity in Q4 and early 2025.
- The company faces tough discussions with customers over price increases in the road segment, which could impact relationships.
- There is uncertainty about the timing of market stabilization in ocean freight, with potential impacts on gross profit per unit.
Welcome to the DSV results for Q3 2024. Today's call is being recorded and expected to last one hour. (Operator Instructions) I would now like to introduce Group CEO, Jens H. Lund and Group CFO, Michael Ebbe. Please begin.
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Thank you very much for participating in our Q3 call. We have an agenda where we go through the highlights, the business segments, a little update on [the] financial review and then also a little bit of update on the timeline for the Schenker transaction. And then as usual, we will then start with the Q&A. But before we do so, I urge you to have a look at the forward-looking statement, so that you are aware of this clause. It's actually on slide number 2. If we move on to slide number 3, we will go into the highlights for the quarter.
I think the sort of very large milestone is obviously that we announced to acquire Schenker in September and we've also raised capital to do so early October. So I think we are
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