Page 8 of 22 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 924 – 26 October 2021
regional and domestic passenger flights, and we only expect a
gradual return of long-haul passenger flights.
DSV achieved 29% volume growth in air freight in Q3 2021
(13% YTD 2021). Adjusted for the addition of Agility GIL, we
estimate that DSV’s growth figures were in line with the market.
Divisional revenue
The division’s revenue amounted to DKK 85,733 million for the
first nine months of 2021, compared to DKK 53,728 million for
the same period last year.
For Q3 2021, revenue amounted to DKK 36,861 million,
compared to DKK 17,910 for the same period last year.
Excluding the impact from GIL, growth for the quarter was
85.0%.
The growth in revenue for the first nine months of 2021 was
driven by elevated freight rates and growth in volumes for both
air and sea. In Q3 2021, air freight was driving the volume
growth, while sea volumes were flat.
The revenue contribution from GIL (1.5 months) came to DKK
3,580 million in Q3 2021 and was also impacted by the
extraordinary market conditions.
The growth was driven by all regions; however, especially APAC
and US contributed to the growth during 2021.
Gross profit
For the first nine months of 2021, gross profit amounted to DKK
16,244 million, compared to DKK 12,841 million for the same
period last year.
For Q3 2021, gross profit amounted to DKK 6,314 million,
compared to DKK 4,303 million for the same period last year,
corresponding to a growth of 31.3%.
The increase in the first nine months of 2021 was driven by
higher yields per unit in sea freight and by increasing activity
levels, especially in air freight.
The gross profit contribution from GIL (1.5 months) came to
DKK 624 million in Q3 2021 and was impacted by the same
market factors.
The market conditions of tight capacity, congestion and
disruption on the global logistics markets continue to have a
positive impact on gross profit per TEU (sea freight) and per
tonne (air freight). Our skilled freight forwarders, scale benefits
and strong carrier relationships enable us to find transport
solutions for our customers despite imbalances in the market. At
the same time, the disruptions impact time consumption per
shipment, as our freight forwarders work hard to find the most
optimal solutions for our customers.
The division’s gross margin was 18.9% for the first nine months
of 2021, compared to 23.9% last year. The decline is primarily
due to higher freight rates, which cause lower gross margin due
to the pass-through element of freight rates on revenue. The
combination with GIL also impacts negatively on the gross
margins due to GIL’s lower gross margins in general.
EBIT before special items
EBIT before special items came to DKK 8,757 million for the first
nine months of 2021, compared to DKK 5,236 million for the
same period last year.
For Q3 2021, EBIT before special items was DKK 3,521 million,
compared to DKK 1,994 million for the same period last year,
which corresponds to an increase of 65.1% excluding the impact
from GIL.
The increase in EBIT before special items was driven by the
growth in gross profit and supported by the continued focus on
cost management. The full-year impact from the Panalpina
integration and COVID-19 cost savings initiatives in 2020 were
also contributing to EBIT growth, especially in H1 2021.
All regions contributed to the strong increase in EBIT before
special items with Americas and EMEA delivering the highest
EBIT increases.
The EBIT contribution from GIL (1.5 months) came to DKK 198
million in Q3 2021 and was also positively impacted by the
extraordinary market conditions.
The conversion ratio was 53.9% for the first nine months of
2021, compared to 40.8% for the same period last year, clearly
reflecting the high productivity of the staff, scalability of the
systems and cost discipline.
The number of full-time employees increased by 42% compared
to September 2020. The increase was mainly related to the
acquisition of GIL.
Net working capital
The Air & Sea division’s net working capital came to DKK 9,069
million on 30 September 2021, compared to DKK 3,612 million
on 30 September 2020. The steep increase was mainly due to
higher activity and higher freight rates and must be seen in
connection with the division’s 85% growth in revenue in Q3
2021. Furthermore, NWC was impacted by the inclusion of GIL
in Q3 2021. We also refer to the comments about NWC on page
6.