Global logistics provider DSV posted earnings growth on higher volume and gross profit in the third quarter, its first year-on-year gains since 2022.
Denmark-based DSV (CPSE: DSV) reported continuing improvement in earnings driven by positive volume growth across all divisions.
Quarterly gross profit improved by 4.8% to $1 billion, and earnings before interest and taxes and before special items was 1.5% higher at $400 million compared to the same period in 2023, leading to sequential growth in diluted adjusted earnings per share of 2.1%, to $270 million.
The company expects full-year 2024 pretax earnings before special items of $1.46 billion-$1.55 billion.
Adjusted free cash flow in the third quarter improved to $227 million.
“Our financial results in Q3 2024 show continued positive earnings growth,” said Jens H. Lund, DSV Group chief executive, in an earnings release. “Our quarterly gross profit and EBIT before special items have increased on a year-over-year basis for the first time since Q3 2022, driven by positive volume growth across all divisions and higher gross profit.”
Improvement came despite the escalation of attacks on shipping in the Red Sea, and low domestic network demand during the first half of this year which continued into the third quarter and led to lower freight rates across most of Europe and in the U.S. compared to the same period a year ago.
“Due to challenging market conditions, utilization was low specifically within our domestic network, adding pressure on profitability for the division,” the company said in the release. “Despite the challenging market, we estimate that the division continued to gain market share, especially as a result of our strong international network and group business.”
In the third quarter, DSV acquired forwarder Schenker from the German government for about $16 billion, creating the world’s largest forwarder. Lund said the company raised $5.4 billion in equity following the announcement. The sale is expected to close in the second quarter of 2025.
The company said the Schenker acquisition will enable it to significantly expand its services in key markets such as France and Germany, and contribute strongly to operational efficiencies.
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