DSV reports expected earnings drop
Freight forwarding giant DSV saw a reflection of the softening demand and normalising freight market in its financial results for the year 2023. The company reported a decrease in gross profit of 13.4 per cent, landing at 43.8 billion Danish Krone ($6.34 billion) for the year 2023, with EBIT slipping 27.4 per cent compared to 2022.
These results were in line with expectations after the extraordinary results of 2022. The general decline in global trade hurt the Air & Sea division, which experienced a 33.1 per cent drop in EBIT compared to 2022. The EBIT for Solutions decreased by 10.7 per cent, and the Road division delivered EBIT figures in line with its 2022 results.
Executive switch at DSV
Effective today, Group CEO Jens Bjørn Andersen will step down, and Jens H. Lund will take over as the new Group CEO. In line with the company’s long-term succession planning, DSV made changes the Executive Board and Group Executive Committee. The new management team will support Jens H. Lund to deliver on DSV’s strategic focus areas.
Following the switch at the helm, Brian Ejsing has been appointed new Group COO of DSV and will join the Executive Board. Furthermore, With effect from 1 February 2024, Albert-Derk Bruin is appointed the new CEO, DSV Solutions.
Also effective February 1, 2024, Morten Landry is appointed new Group CCO. Carsten Trolle, CEO, DSV Air & Sea, has decided to step down after more than 39 years with DSV and 9 years in charge of the Air & Sea division. He will continue in a central role and support the Group with strategic projects. Frank Sobotka has been appointed as new CEO, DSV Air & Sea.
Departing CEO Jens Bjørn Andersen, said, “DSV delivered solid financial results for 2023, in line with our expectations. In a market characterised by declining demand for transport services across most markets, we demonstrated our ability to adapt to changing market conditions, and our dedicated employees continued to deliver excellent customer service. During 2023, we were happy to announce an exclusive logistics joint venture with NEOM Company and we have continued the work to strengthen our network services and industry expertise. We also made important progress on the sustainability agenda, developing roadmaps for our decarbonisation efforts.”
Looking towards 2024, DSV said it expects its EBIT to be in the range of $2.1 and $2.5 billion. The company said the outlook assumes global GDP growth around 3 per cent in 2024, and that the markets for Air & Sea will grow 3-4 per cent. DSV is targeting profitable, above-market growth, but its strategic growth initiatives may only have a gradual impact in 2024.
For Road, DSV expects a flat or low-growth market, while the market for Solutions (contract logistics) is expected to achieve higher growth rates in 2024.
DSV did stress that the geopolitical and macroeconomic environment remains uncertain, and unforeseen changes may therefore impact its financial results.