DFDS swings to Q1 net loss in a mixed market

DFDS swings to Q1 net loss in a mixed market

Photo DFDS

Danish shipping and logistics company, DFDS, swung to a net loss in the first quarter of 2024, as the current market environment remains mixed. In its quarterly report, the company posted a DKK 48 million (USD 6.9 million) net loss in the first quarter. This compares to a DKK 137 million (USD 19.7 million) net profit in the corresponding quarter a year ago.

However, the company’s revenue is on the rise, jumping from DKK 6.3 billion (USD 912.9 million) in Q1 2023, to DKK 7 billion (USD 1 billion) in the quarter under review. EBITDA for the period slipped 2 per cent from Q1 2023 figures landing at DKK 957 million (USD 137.7 million).

Commenting on the first quarter interim results, DFDS CEO, Torben Carlsen said, “2024 is the first year of our new strategy Moving Together Towards 2030 focused on unlocking the value of our expanded network through organic growth and transitioning to become a greener company. The expansion of our network to high-growth markets was fulfilled in April with the agreement to acquire the international transport network of Ekol Logistics. The transaction is expected to close in Q4 2024. The newly acquired ferry routes on the Strait of Gibraltar were off to a good start.”

As foreseen the current market environment remains mixed. DFDS saw a higher-than-expected pick-up in ferry volumes across most of the network in the first while its land transport network mostly faced flat or lower volumes. Persistent overcapacity enhanced pricing pressure in certain market areas.

“While we are on track to deliver on our outlook, we continue to focus on improving profit through operational efficiencies across our network,” Carlsen said, adding that the results for Q1 have beaten the company’s expectations, mostly driven by the Ferry Division.

Ferry Division’s revenue was up 10 per cent, with freight volumes rising 8.9 per cent compared to the first quarter of 2023. Volumes increased in all business areas reflecting a general pick-up in activity across the network compared to a relatively low activity level in Q1 2023. The highest growth was achieved in the Baltic Sea and Channel networks. The Easter timing difference versus 2023 reduced volumes in March compared to 2023.

Logistics Division also saw its revenue jump 10 per cent, despite the overall development in Dry Goods volumes remaining mixed across the three regions. Baltic volumes were lower driven by both the Finnish and Swedish activities. Activity levels were also soft for the Norwegian and Danish activities. This was offset by higher Sweden UK volumes and the continued ramp-up of warehousing activity.

Continent-UK volumes were overall maintained above 2023 while automotive volumes and part-loads were lower in the quarter, also due to the Easter holiday in March. New activities launched in Poland continued to grow.

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Author: Adnan Bajic

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