DSV Group
global, yet our presence is local and close to our customers. Approximately 75,000 employees in more than 80 countries work passionately to deliver great customer
experiences and high-quality services. Read more at www.dsv.com
INTERIM FINANCIAL REPORT
Q1 2024
Company Announcement No. 1103
24 April 2024
Selected key figures and ratios for the period 1 January – 31 March 2024
Q1 2024
Q1 2023
Key figures (DKKm)
Revenue
38,340
40,954
Gross profit
10,265
11,391
Operating profit (EBIT) before special items
3,641
4,672
Profit for the period
2,393
3,287
Adjusted earnings for the period
2,463
3,340
Ratios
Conversion ratio
35.5%
41.0%
Diluted adjusted earnings per share of DKK 1 for the last 12 months
55.3
76.9
Jens H. Lund, Group CEO: “In a normalising market, we are off to a good start delivering strong financial results in the first quarter of 2024,
and I am particularly satisfied that we are gaining market shares in all three divisions. We have also completed the leadership changes, the
organisation has settled, and together with the new and experienced leadership team we will concentrate our efforts on executing on our
strategy, with particular focus on our customers.”
Outlook for 2024
We maintain our outlook for 2024 as announced in the 2023 Annual Report:
• Operating profit (EBIT) before special items is expected to be in the range of DKK 15,000-17,000 million.
• The effective tax rate is expected to be approximately 24%.
Share buyback
A separate company announcement about a new share buyback programme of DKK 1,000 million will be issued today. The programme
starts 24 April 2024 and will run until 23 July 2024.
Contacts
Investor Relations: Sebastian Rosborg, tel. +45 43 20 33 87, sebastian.rosborg@dsv.com
Media: For media enquiries, please contact press@dsv.com
Yours sincerely,
Page 2 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Interim Financial Report
Q1 2024
Keeping supply chains flowing in a world of change
Page 3 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Contents
Financial highlights ......................................................................................................................... 4
Management’s commentary ............................................................................................................ 5
Air & Sea ........................................................................................................................................... 9
Road ................................................................................................................................................ 12
Solutions ........................................................................................................................................ 14
Interim financial statements .......................................................................................................... 16
Notes to the interim financial statements .................................................................................... 21
Statement by the Board of Directors and the Executive Board .................................................. 24
Page 4 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Financial highlights
Q1 2024
Q1 2023
Results (DKKm)
Revenue
38,340
40,954
Gross profit
10,265
11,391
Operating profit before amortisation and depreciation (EBITDA) before special items
5,032
5,941
Operating profit (EBIT) before special items
3,641
4,672
Net financial expenses
484
346
Profit for the period
2,393
3,287
Adjusted earnings for the period
2,463
3,340
Cash flows (DKKm)
Operating activities
1,756
6,121
Investing activities
(358)
(397)
Free cash flow
1,398
5,724
Adjusted free cash flow
443
4,898
Share buyback
(1,613)
(3,019)
Dividends distributed
(1,533)
(1,424)
Cash flow for the period
119
1,580
Gross investment in property, plant and equipment
561
408
Financial position (DKKm)
DSV A/S shareholders’ share of equity
68,629
70,503
Non-controlling interests
285
217
Total equity
68,914
70,720
Total assets
152,023
154,772
Net working capital (NWC)
7,078
3,126
Net interest-bearing debt (NIBD)
37,828
28,960
Invested capital
103,039
97,151
Financial ratios (%)
Gross margin
26.8
27.8
Operating margin
9.5
11.4
Conversion ratio
35.5
41.0
Effective tax rate
24.2
24.0
ROIC before tax
16.7
23.2
Return on equity
16.4
22.5
Solvency ratio
45.1
45.6
Gearing ratio
1.7
1.0
Share ratios
Earnings per share (EPS) of DKK 1 for the last 12 months
54.0
73.8
Diluted adjusted earnings per share of DKK 1 for the last 12 months
55.3
76.9
Number of shares issued (’000) at 31 March
219,000
219,000
Number of treasury shares (’000) at 31 March
10,306
2,901
Average number of shares issued (’000) for the last 12 months
211,689
223,204
Average diluted number of shares (’000) for the last 12 months
212,961
225,714
Diluted number of shares (’000) at 31 March
209,162
218,280
Share price end of period (DKK)
1,122.0
1,326.5
Non-financials
Full-time employees (FTE) at 31 March
73,879
74,613
For definition of key figures and ratios, please refer to page 82 of the DSV Annual Report 2023.
For definition of non-financial data, please refer to the DSV Sustainability Report 2023.
Page 5 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Management’s commentary
The DSV Group delivered a strong set of results for Q1 2024. The financial performance was in line with
our expectations and reflects seasonality and the continued market normalisation. Adjusted free cash flow
for the quarter is satisfactory when adjusted for increased activity levels and funds tied up in property
projects. Gross profit for the quarter was down 8.6% and EBIT declined 20.8%.
In a volatile and competitive market environment, we saw positive momentum on our sustainable growth,
and DSV is taking market share across most of the markets we operate in.
Quarterly highlights
DSV is built on a series of large and successfully integrated
acquisitions. While M&A continues to be at the core of our
strategy, we are strengthening our operational and commercial
focus. Sustainable organic growth will be driven based on an
even deeper understanding of our customers across segments
and industries and an intensified development of our global
network and services.
We have completed an executive, divisional and commercial
leadership transition to ensure that we have a team in place with
leading industry capabilities and which can execute effectively
across our three divisions on enterprise level.
With the new organisation and strengthened commercial focus
in place, we are confident that we have the right platform to
deliver above-market growth across all business areas. The
strategic focus will deliver increased growth on our largest global
customers, which represent more than half of our gross profit,
while also maintaining our historically strong position in the
small- and mid-sized customer segment.
We also made good progress maturing our global network, i.e.,
through improved LCL on sea freight, air freight, groupage and
vertical-specific set-ups including increased use of control
towers and further digitalising our operations (including use of
AI). These efforts also supported our continued focus on
operational excellence.
NEOM update
In October 2023, we announced an exclusive logistics joint
venture to provide logistics services for the projects in the
NEOM region. The project is mobilised and ready to go live in
Q2 as planned. The timing of investments in the joint venture will
depend on the progress of the individual projects in NEOM.
Based on current plans, we expect the joint venture activities to
ramp up over the next 3-4 years. The joint venture will have a
positive impact on the DSV network, and we expect a return on
the invested capital in line with our financial targets. Human
rights policies in line with DSV principles will be an integrated
part of the joint venture, and we will report on this when we go
live. So far, we have had no issues during the mobilisation
phase.
Results for the period
Growth 2023 – 2024
(DKKm)
Q1 2023
Currency
translation
Q1 2023 in
constant
currencies
Growth
Growth %*
Q1 2024
Revenue
40,954
(581)
40,373
(2,033)
(5.0%)
38,340
Gross profit
11,391
(158)
11,233
(968)
(8.6%)
10,265
EBIT before special items
4,672
(74)
4,598
(957)
(20.8%)
3,641
Gross margin (%)
27.8
26.8
Operating margin (%)
11.4
9.5
Conversion ratio (%)
41.0
35.5
* Growth in constant currencies
Page 6 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Revenue
For Q1 2024, revenue amounted to DKK 38,340 million,
compared to DKK 40,954 million last year. In constant
currencies, revenue declined 5.0% compared to same period
last year.
Revenue and growth by division compared to same period last
year are specified below:
(DKKm)
Q1 2024
Q1 2023
Growth*
Air & Sea
22,716
26,213
(11.5%)
Road
10,425
10,094
3.3%
Solutions
5,989
5,625
7.3%
Group and eliminations
(790)
(978)
Total
38,340
40,954
(5.0%)
* Growth in constant currencies
In the Air & Sea division, revenue declined by 11.5% in Q1
2024. Revenue was impacted by higher volumes in both air and
sea, but this was offset by lower average freight rates. Although
spot rates are higher than last year, the average contract rate for
the current period is lower compared to same period last year.
Road and Solutions both had a good start to Q1 2024 with
organic growth in both divisions. In Road, the increase was
driven by slightly higher volumes, which were partly offset by
lower rates and less working days compared to same period last
year. Solutions added capacity across most regions, which
increased the overall activity.
Revenue by division, Q1 2024
Gross profit
For Q1 2024, gross profit amounted to DKK 10,265 million,
compared to DKK 11,391 million last year. In line with
expectations, gross profit in constant currencies declined 8.6%
compared to same period last year, mainly due to a
normalisation of freight rates and yields in the Air & Sea division.
Gross profit and growth by division compared to same period
last year are specified below:
(DKKm)
Q1 2024
Q1 2023
Growth*
Air & Sea
5,763
7,027
(16.2%)
Road
1,964
1,976
(0.7%)
Solutions
2,401
2,285
5.8%
Group and eliminations
137
103
Total
10,265
11,391
(8.6%)
* Growth in constant currencies
As expected, the gross profit yields were largely stable
compared to Q4 2023 levels. In line with our expectations, the
Air & Sea division saw a decline in gross profit compared to last
year. This was caused by lower gross profit yields, partly offset
by volume growth for both air and sea.
The Road division achieved gross profit in line with last year
despite declining market activity. The division saw positive
development and delivered market share gains, particularly on
international activities. Solutions also developed positively and
saw gross profit growth of 5.8% for the quarter due to higher
activity levels.
Gross profit declined mainly in APAC and Americas driven by
lower freight yields. EMEA region was stable mainly driven by
double-digit growth in Middle East compared to same period last
year.
Gross profit by division, Q1 2024
The gross margin for the Group was 26.8% for Q1 2024,
compared to 27.8% for the same period last year. The decline
was mainly due to Air & Sea and reflects a normalisation of both
freight rates and yields.
EBIT before special items
EBIT before special items amounted to DKK 3,641 million for Q1
2024, compared to DKK 4,672 million last year. In constant
currencies, EBIT before special items was down 20.8%. The
reduced EBIT was mainly due to lower gross profit in Air & Sea.
EBIT and growth by division compared to same period last year
are specified below:
(DKKm)
Q1 2024
Q1 2023
Growth*
Air & Sea
2,627
3,626
(26.0%)
Road
490
495
(1.8%)
Solutions
500
548
(8.8%)
Group and eliminations
24
3
Total
3,641
4,672
(20.8%)
* Growth in constant currencies
The conversion ratio for the Group was 35.5% for Q1 2024,
compared to 41.0% for the same period last year. The decrease
reflects a lower conversion ratio in Air & Sea and Solutions,
primarily impacted by lower gross profit yields in Air & Sea and
lower average warehouse utilisation in Solutions due to our
global expansion.
Page 7 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
The total cost base is slightly lower compared to the same
period last year. During 2023, various cost initiatives were
initiated which reduced both staff cost and other external cost.
The cost savings have been partly offset by general cost
inflation. The leadership team will continue to adjust the cost
base to match the activity levels.
Most regions reported lower EBIT in Q1 2024 compared to the
same period last year. The Middle East and Africa regions
recorded growth compared to last year.
EBIT by division, Q1 2024
Financial items
Financial items totalled a net expense of DKK 484 million for Q1
2024, compared to a net expense of DKK 346 million for the
same period last year. The higher net financial expenses
compared to last year were mainly related to the increase in
lease liabilities, increased debt and losses incurred in a few
countries due to currency devaluation.
(DKKm)
Q1 2024
Q1 2023
Interest on lease liabilities
252
195
Other interest expenses, net
153
100
Interest on pensions
11
8
Foreign exchange adjustments
68
43
Net financial expenses
484
346
Tax on profit for the period
The effective tax rate came to 24.2% for Q1 2024, compared to
24.0% for the same period last year.
Profit for the period
Profit for Q1 2024 was DKK 2,393 million, compared to DKK
3,287 million for the same period of 2023. The decline was
mainly due to the lower EBIT for the period.
Diluted adjusted earnings per share
Diluted adjusted EPS (rolling 12-months) decreased by 28.1%
compared to the same period last year and came to DKK 55.3
per share (31 March 2023: DKK 76.9 per share). The decline
was due to the decrease in adjusted earnings partly offset by a
5.7% decrease in average number of shares issued following
the Group’s share buy-back programmes.
Cash flow
Cash flow statement – summary
(DKKm)
Q1 2024
Q1 2023
EBITDA before special items
5,032
5,941
Change in net working capital
(2,092)
1,989
Tax, interests, change in provisions, etc.
(1,184)
(1,677)
Special items
-
(132)
Cash flow from operating activities
1,756
6,121
Cash flow from investing activities
(358)
(397)
Free cash flow
1,398
5,724
Cash flow from financing activities
(1,279)
(4,144)
Cash flow for the period
119
1,580
Free cash flow
1,398
5,724
Special items
-
132
Repayment of lease liabilities
(955)
(958)
Adjusted free cash flow
443
4,898
Adjusted free cash flow for Q1 2024 was DKK 443 million,
compared to DKK 4,898 million for the same period last year.
The decline in adjusted free cash flow for the first three months
of 2024 was impacted by the lower EBITDA.
The sequential increase in activity levels and rates in Q1 2024
lead to higher net revenue compared to Q4 2023, resulting in an
increase in net working capital. The net working capital
development in Q1 2023 was impacted by the opposite
development due to the normalisation of market conditions back
from 2022. Cash flow from investing activities came to a cash
outflow of DKK 358 million for Q1 2024 and was in line with
same period last year.
Cash flow from financing activities was a net cash outflow of
DKK 1,279 million for Q1 2024, primarily related to share
buyback and dividend.
Net working capital
On 31 March 2024, the Group’s net working capital was DKK
7,078 million, compared to DKK 3,126 million on 31 March 2023,
an increase of DKK 3,952 million. Currently, we have approx.
DKK 4,500 million tied up in property projects mainly in large
projects in Denmark and Sweden. The funds tied up in property
projects will be reduced over the coming quarters to an
expected level of around DKK 2,500 million at year end.
Property projects is an integrated part of our strategy of always
having an efficient infrastructure.
Relative to estimated full-year revenue, funds tied up in NWC
were 4.6% on 31 March 2024 (31 March 2023: 1.9%). We
maintain high focus on managing NWC and we have seen a
stable level of invoicing days and overdue receivables during Q1
2024. As funds tied up in property projects normalise over the
coming quarters, we expect a reduction of more than DKK 2
billion and an NWC relative to full-year revenue in the level of
3%.
2,627
73%
490
13%
500
14%
Air & Sea
Road
Solutions
Ex. Group and
elimination
Page 8 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Capital structure and finances
DSV A/S shareholders’ share of equity
DSV shareholders’ share of equity was DKK 68,629 million on
31 March 2024 (DKK 68,703 million on 31 December 2023).
Equity remained relatively stable, as the profit for the period and
proceeds from the sale of treasury shares are redistributed to
shareholders.
On 31 March 2024, the Company’s portfolio of treasury shares
was 10,305,995 shares. On 23 April 2024, the portfolio of
treasury shares was 5,378,594 shares.
DSV reduced its share capital on 12 April 2024 through the
cancellation of 5,000,000 treasury shares. Please refer to
Company Announcement No. 1102.
The solvency ratio excluding non-controlling interests was
45.1% on 31 March 2024 (31 March 2023: 45.6%).
The development in equity since 1 January is specified below:
(DKKm)
Q1 2024
Q1 2023
Equity at 1 January
68,703
71,519
Profit for the period (attributable to
DSV shareholders)
2,377
3,266
Currency translation, foreign
enterprises
82
(899)
Allocated to shareholders
(3,146)
(4,443)
Sale of treasury shares
492
888
Other equity movements
121
172
Equity end of period
68,629
70,503
Net interest-bearing debt
Net interest-bearing debt amounted to DKK 37,828 million on 31
March 2024, compared to DKK 28,960 million on 31 March
2023. The increase in net interest-bearing debt can mainly be
attributed to investment activities and an increase in lease
liabilities during the last 12 months.
The gearing ratio (NIBD/EBITDA) was 1.7x on 31 March 2024,
compared to 1.0x last year. A new share buyback programme of
DKK 1,000 million is initiated on 24 April 2024 in line with our
target of a financial gearing ratio below 2.0x. The size of the new
programme reflects the current level of net working capital as
well as expected investments related to the NEOM joint venture.
The weighted average duration of the company’s long-term
bonds and drawn credit facilities was 7.2 years on 31 March
2024.
Invested capital and ROIC
The invested capital including goodwill and customer
relationships amounted to DKK 103,039 million on 31 March
2024, compared to DKK 97,151 million on 31 March 2023. The
increase was mainly a result of higher net working capital.
Return on invested capital (including goodwill and customer
relationships) was 16.7% for the rolling 12-month period ended
31 March 2024 compared to 23.2% last year. The decrease was
predominantly due to the decline in EBIT.
Excluding goodwill and customer relationships, return on
invested capital was 69.9% for the rolling 12-month period
ended 31 March 2024, compared to 97.8% for the same period
last year.
Outlook
We maintain our outlook for 2024 as announced in the 2023
Annual Report:
• Operating profit (EBIT) before special items is
expected to be in the range of DKK 15,000-17,000
million.
• The effective tax rate is expected to be approximately
24%.
Page 9 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Air & Sea
The Air & Sea division operates a global network specialising in transportation of cargo by air and sea.
The division offers conventional freight forwarding services and tailored project cargo solutions.
The division gained market share across most markets, while keeping gross profit yields and the cost
base stable compared to Q4 2023. In a market driven by soft volume growth and normalised yields, the
Air & Sea division saw a 16.2% decrease in gross profit and 26.0% decrease in EBIT before special items
for Q1 2024 compared to the same period last year.
Statement of profit or loss
(DKKm)
Q1 2024
Q1 2023
Divisional revenue
22,716
26,213
Direct costs
16,953
19,186
Gross profit
5,763
7,027
Other external costs
908
1,023
Staff costs
1,943
2,093
EBITDA before special items
2,912
3,911
Amortisation and depreciation
285
285
EBIT before special items
2,627
3,626
Key figures and ratios
Q1 2024
Q1 2023
Gross margin (%)
25.4
26.8
Operating margin (%)
11.6
13.8
Conversion ratio (%)
45.6
51.6
Full-time employees
21,242
22,270
Total invested capital (DKKm)
65,003
65,118
Net working capital (DKKm)
2,714
2,738
ROIC before tax (%)
19.0
27.5
Quarterly highlights
The division continued the expansion of our global network. For
air freight, focus was on optimising our European routings and
developing the gateway infrastructure.
We continued to develop our LCL sea freight product, focusing
on increasing own controlled consolidation and improving the
service levels and quality.
Within both air and sea freight, the division also expanded the
collaboration with the Road division.
The continued growth of the network will ensure a high service
level towards our customers and higher profitability per
container.
We already now see positive results from the revised
commercial approach, which we expect to be gradually phased
in during the comings quarters.
Market development
DSV volume growth
Q1 2024
Air freight – tonnes
2.3%
Sea freight – TEUs
8.2%
Air
DSV’s air volumes increased 2.3% in Q1 2024 compared to the
same period last year, mainly owing to strong development in
export volumes from APAC. The air freight market is impacted
by continued high growth in e-commerce volumes from China,
Page 10 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
driving both market volumes and rates up. Adjusted for the
above and perishables impact, we estimate that our addressable
market is growing by low single digits.
Air freight capacity continues to increase due to more passenger
travel, which generates more available belly capacity. Combined
with more freighter capacity compared to pre-pandemic, this has
led to overcapacity in the air freight market. During 2024, we
expect that some of the excess capacity will be offset by
retirement of old aircrafts.
Sea
In the first quarter of 2024, DSV’s sea freight volumes grew by
8.2% compared to the same period last year. The strongest
growth rates were recorded on export volumes out of APAC.
The rerouting of ships around the Cape of Good Hope in
response to the Red Sea crisis led to increased freight rates in
the quarter. The additional voyage time of approximately 10-14
days ties up some capacity. Nonetheless, the sea freight market
continues to be impacted by significant incoming capacity. We
estimate that the market grew by mid-single digits in Q1 2024.
Divisional revenue
The division’s revenue amounted to DKK 22,716 million for Q1
2024, compared to DKK 26,213 million for the same period last
year, and was down 11.5% in constant currencies.
Volumes, especially within sea, showed continued improvement
during the quarter. The development was partly a result of lower
average rates compared to the same period last year. Total
shipment count increased by 9% compared to Q1 last year.
The division’s average revenue per unit was 21.7% below last
year for air and 24.8% below last year for sea.
Gross profit
For Q1 2024, gross profit amounted to DKK 5,763 million,
compared to DKK 7,027 million for the same period last year. In
constant currencies, gross profit dropped 16.2%.
The decline in gross profit compared to last year was caused by
lower gross profit yields in both air and sea. However, yields
remained relatively stable compared to Q4 2023.
The division’s gross margin was 25.4% for Q1 2024, compared
to 26.8% last year. The decrease was mainly driven by lower
gross profit yields compared to the extraordinary levels in Q1
last year.
Geographically, almost all regions delivered lower gross profit.
The biggest declines were reported in APAC and Americas,
whereas strong growth was observed in the Middle East and
Africa.
EBIT before special items
EBIT before special items came to DKK 2,627 million for Q1
2024, compared to DKK 3,626 million for the same period last
year. In constant currencies, EBIT before special items declined
26.0%. Q1 is normally the quarter with the lowest activity.
The decline in EBIT before special items was due to lower gross
profit, which was partially offset by a reduced cost base
compared to last year. The division initiated various cost
initiatives last year, reducing both staff cost and other external
cost. The cost base will continue to be adjusted to match activity
levels.
The conversion ratio was 45.6% for Q1 2024, compared to
51.6% for the same period last year. The decline is primarily due
to lower average freight yields.
Net working capital
The Air & Sea division’s net working capital came to DKK 2,714
million on 31 March 2024, compared to DKK 2,738 million on 31
March 2023.
Growth Air & Sea 2023 – 2024
(DKKm)
Q1 2023
Currency
translation
Q1 2023 in
constant
currencies
Growth
Growth %*
Q1 2024
Divisional revenue
26,213
(542)
25,671
(2,955)
(11.5%)
22,716
Gross profit
7,027
(146)
6,881
(1,118)
(16.2%)
5,763
EBIT before special items
3,626
(78)
3,548
(921)
(26.0%)
2,627
* Growth in constant currencies
Page 11 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Air & Sea freight performance
Air freight
(DKKm)
Q1 2024
Q1 2023
Divisional revenue
12,167
14,265
Direct costs
9,272
10,538
Gross profit
2,895
3,727
Gross margin (%)
23.8
26.1
Volume (tonnes)*
335,213
327,712
Gross profit per unit (DKK)
8,636
11,373
Sea freight
(DKKm)
Q1 2024
Q1 2023
Divisional revenue
10,549
11,948
Direct costs
7,681
8,648
Gross profit
2,868
3,300
Gross margin (%)
27.2
27.6
Volume (TEUs)*
636,544
588,207
Gross profit per unit (DKK)
4,506
5,610
* Volume is defined as the quantity of export cargo processed within DSV network. Sea volume is measured in
TEUs (twenty-foot equivalent units), while air volume is determined by chargeable weight, quantified in tonnes.
Page 12 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Road
The Road division is among the market leaders in Europe and has operations in North America, South
Africa and in the Middle East. The division offers full load, part load and groupage services through a
network of more than 250 terminals.
In Q1 2024, the Road division achieved results in line with our expectations. The division performed
strongly and gained market share resulting in a stable gross profit, despite a weak market with lower
activity levels in several industries and fewer working days in the quarter.
Statement of profit or loss
(DKKm)
Q1 2024
Q1 2023
Divisional revenue
10,425
10,094
Direct costs
8,461
8,118
Gross profit
1,964
1,976
Other external costs
324
363
Staff costs
937
902
EBITDA before special items
703
711
Amortisation and depreciation
213
216
EBIT before special items
490
495
Key figures and ratios
Q1 2024
Q1 2023
Gross margin (%)
18.8
19.6
Operating margin (%)
4.7
4.9
Conversion ratio (%)
24.9
25.1
Full-time employees
16,718
16,291
Total invested capital (DKKm)
12,983
11,312
Net working capital (DKKm)
1,409
87
ROIC before tax (%)
16.5
18.6
Quarterly highlights
In Q1 2024, we continued developing our European groupage
network, which showed strong momentum during the quarter.
We also continued the streamlining of our pan-European control
tower set-ups, which further strengthened the services to large
customers. Both of these initiatives are fundamental enablers for
the positive development of our profitable international activities
in the division. Executing on our strategy has resulted in
continued above-market growth.
Market development
As a result of muted activity across multiple industries, road
market volumes are slightly down in Q1 2024 compared to the
same period last year. This development generated lower freight
rates across most road activities in Europe.
Divisional revenue
The division’s revenue amounted to DKK 10,425 million for Q1
2024, compared to DKK 10,094 million last year.
For the quarter, the increase in revenue was driven by additional
volumes in our groupage network, which were partly offset by
lower market rates and fewer working days compared to the
same period last year.
The division generates more than 85% of its revenue in Europe
and saw good performance across most countries in the region.
Gross profit
For Q1 2024, gross profit totalled DKK 1,964 million, compared
to DKK 1,976 million for the same period last year.
Page 13 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
The division’s gross margin was 18.8% for Q1 2024, compared
to 19.6% for the same period in 2023. The lower gross margin
can be attributed to the competitive nature of the current market.
The division maintains focus on developing and growing its
European groupage operations, which will have a positive
impact on the gross margin over time.
EBIT before special items
EBIT before special items was DKK 490 million for Q1 2024,
which was on level with last year. The division performed well in
a declining market. The cost base for Q1 2024 was stable
compared to the previous quarter.
The conversion ratio came to 24.9% for Q1 2024, compared to
25.1% for the same period last year. The conversion ratio was
impacted by fewer working days in the quarter and by
implementation cost on a large contract.
Net working capital
The Road division’s net working capital was DKK 1,409 million
on 31 March 2024, compared to DKK 87 million on 31 March
2023. The development was impacted by an increase in funds
tied up in property projects, especially related to the new
terminal in Horsens, Denmark, which will be one of the largest
road terminals in Europe. NWC is expected to normalise during
2024.
Growth Road 2023 - 2024
(DKKm)
Q1 2023
Currency
translation
Q1 2023 in
constant
currencies
Growth
Growth %*
Q1 2024
Divisional revenue
10,094
(4)
10,090
335
3.3%
10,425
Gross profit
1,976
2
1,978
(14)
(0.7%)
1,964
EBIT before special items
495
4
499
(9)
(1.8%)
490
* Growth in constant currencies
Page 14 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Solutions
The Solutions division offers warehousing and logistics services globally and controls more than 500
logistics facilities. The service portfolio includes freight management, customs clearance, order
management and e-commerce solutions.
In Q1 2024, the Solutions division achieved solid gross profit growth of 5.8% compared to the same
period last year without any increase in number of full-time employees, benefiting from prior years
investments in new warehouses and automation. However, EBIT declined due to lower warehouse
utilisation rate, which mainly relates to temporary, and expected, reduced occupancy at new sites.
Statement of profit or loss
(DKKm)
Q1 2024
Q1 2023
Divisional revenue
5,989
5,625
Direct costs
3,588
3,340
Gross profit
2,401
2,285
Other external costs
437
453
Staff costs
650
588
EBITDA before special items
1,314
1,244
Amortisation and depreciation
814
696
EBIT before special items
500
548
Key figures and ratios
Q1 2024
Q1 2023
Gross margin (%)
40.1
40.6
Operating margin (%)
8.3
9.7
Conversion ratio (%)
20.8
24.0
Full-time employees
31,395
31,511
Total invested capital (DKKm)
26,561
23,660
Net working capital (DKKm)
3,204
1,741
ROIC before tax (%)
9.2
10.7
Quarterly highlights
In the Solutions division, we continued executing on our long-
term strategy for consolidation and developing multi-client
warehouse campuses based on roadmaps for each region. In
Q1 2024 we added new warehouse space in Europe and South
Africa. Executing on our strategy has resulted in continued
above-market growth.
Market development
In Q1 2024, the market for contract logistics was relatively stable
compared to last year. The market continues to see low
inventory levels, and demand is still weak across most sectors.
We have added more new sites across all regions. This has a
temporary dilutive effect on the warehouse utilisation ratio
compared to last year.
Divisional revenue
The division’s revenue was DKK 5,989 million for Q1 2024,
compared to DKK 5,625 million for the same period of 2023. In
constant currencies, revenue increased 7.3%.
The strong revenue performance for the quarter was due to
higher activity measured by number of order lines handled
compared to last year.
Geographically, the best performing regions for Q1 2024 were
EMEA and Americas.
Page 15 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Gross profit
For Q1 2024, gross profit was DKK 2,401 million, compared to
DKK 2,285 million for the same period of 2023. In constant
currencies, gross profit was up by 5.8%.
The division’s gross margin was 40.1% for Q1 2024, compared
to 40.6% for the same period last year.
The division's campus strategy of consolidating into large and
efficient warehouses with increased automation was a key driver
behind the division’s ability to maintain a strong gross margin
while adding new capacity.
EBIT before special items
EBIT before special items was DKK 500 million for Q1 2024,
compared to DKK 548 million for the same period of 2023, and
was down by 8.8% in constant currencies.
EMEA saw the strongest regional EBIT performance compared
to last year.
The conversion ratio was 20.8% for Q1 2024, compared to
24.0% for the same period last year. In the first quarter of 2024,
the cost base was impacted by the expansion of new
warehouses, resulting in higher depreciations on leased assets.
As new capacity is not yet fully utilised, the division is currently
operating with a utilisation rate slightly below the previous year.
This has a temporary dilutive impact on the conversion ratio.
Net working capital
The division’s net working capital came to DKK 3,204 million on
31 March 2024, compared to DKK 1,741 million on 31 March
2023. The development was impacted by an increase in funds
tied up in property projects related to new sites.
Growth Solutions 2023 – 2024
(DKKm)
Q1 2023
Currency
translation
Q1 2023 in
constant
currencies
Growth
Growth %*
Q1 2024
Divisional revenue
5,625
(45)
5,580
409
7.3%
5,989
Gross profit
2,285
(15)
2,270
131
5.8%
2,401
EBIT before special items
548
-
548
(48)
(8.8%)
500
* Growth in constant currencies
Page 16 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Interim financial statements
Statement of profit or loss
(DKKm)
Q1 2024
Q1 2023
Revenue
Direct costs
Gross profit
Other external costs
Staff costs
Operating profit before amortisation and depreciation
(EBITDA) before special items
Amortisation and depreciation
Operating profit (EBIT) before special items
Financial income
Financial expenses
Profit before tax
Tax on profit for the period
Profit for the period
Profit for the period attributable to:
Shareholders of DSV A/S
Non-controlling interests
Earnings per share:
Earnings per share of DKK 1 for the period
Diluted earnings per share of DKK 1 for the period
Page 17 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Statement of comprehensive income
(DKKm)
Q1 2024
Q1 2023
Profit for the period
Items that may be reclassified to profit or loss when certain conditions are met:
Net foreign exchange differences recognised in OCI
(901 )
Fair value adjustments of hedging instruments
(2 )
Fair value adjustments of hedging instruments transferred to financial expenses
Tax on items reclassified to profit or loss
(1 )
Items that will not be reclassified to profit or loss:
Actuarial gains/(losses)
(84 )
Tax on items that will not be reclassified
(14 )
Other comprehensive income, net of tax
(969 )
Total comprehensive income
Total comprehensive income attributable to:
Shareholders of DSV A/S
Non-controlling interests
Total
Page 18 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Statement of cash flows
(DKKm)
Q1 2024
Q1 2023
Operating profit before amortisation and depreciation (EBITDA) before special items
Adjustments:
Share-based payments
Change in provisions
(7 )
(6 )
Change in working capital
(2,092 )
Special items, paid
(132 )
Interest received
Interest paid, lease liabilities
(252 )
(195 )
Interest paid, other
(237 )
(198 )
Income tax paid
(789 )
(1,421 )
Cash flow from operating activities
Purchase of intangible assets
(80 )
(90 )
Purchase of property, plant and equipment
(561 )
(408 )
Disposal of property, plant and equipment
Change in other financial assets
(134 )
Cash flow from investing activities
(358 )
(397 )
Free cash flow
Proceeds from borrowings
Repayment of borrowings
(64 )
(47 )
Repayment of lease liabilities
(955 )
(958 )
Other financial liabilities incurred
(2 )
(3 )
Transactions with shareholders:
Dividends distributed to shareholders of DSV A/S
(1,533 )
(1,424 )
Purchase of treasury shares
(1,613 )
(3,019 )
Sale of treasury shares
Other transactions with shareholders and non-controlling interests
(5 )
Cash flow from financing activities
(1,279 )
(4,144 )
Cash flow for the period
Cash and cash equivalents 1 January
Cash flow for the period
Currency translation
(57 )
(58 )
Cash and cash equivalents end of period
The statement of cash flows cannot be directly derived from the statement of financial position and statement of profit or loss.
Statement of adjusted free cash flow (DKKm)
Q1 2024
Q1 2023
Free cash flow
Special items (reversed)
Repayment of lease liabilities
(955 )
(958 )
Adjusted free cash flow
Page 19 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Statement of financial position
Assets (DKKm)
31.03.2024
31.12.2023
31.03.2023
Intangible assets
Right-of-use assets
Property, plant and equipment
Other receivables
Deferred tax assets
Total non-current assets
Trade receivables
Contract assets
Inventories
Other receivables
Cash and cash equivalents
Assets held for sale
Total current assets
Total assets
Equity and liabilities (DKKm)
31.03.2024
31.12.2023
31.03.2023
Share capital
Reserves
(633 )
(718 )
Retained earnings
DSV A/S shareholders’ share of equity
Non-controlling interests
Total equity
Lease liabilities
Borrowings
Pensions and other post-employment benefit plans
Provisions
Deferred tax liabilities
Total non-current liabilities
Lease liabilities
Borrowings
Trade payables
Accrued cost of services
Provisions
Other payables
Tax payables
Total current liabilities
Total liabilities
83,109
78,144
84,052
Total equity and liabilities
152,023
147,110
154,772
Page 20 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Statement of changes in equity at 31 March 2024
Attributable to shareholders of DSV A/S
(DKKm)
Share
capital
Reserves
Retained
earnings
Total
Non-
controlling
interests
Total
equity
Equity at 1 January 2024
(718 )
Profit for the period
Other comprehensive income, net of tax
Total comprehensive income for the period
Transactions with shareholders and
non-controlling interests:
Share-based payments
Tax on share-based payments
(70 )
(70 )
(70 )
Dividends distributed
(1,533 )
(1,533 )
-
(1,533 )
Purchase of treasury shares
(1 )
(1,612 )
(1,613 )
(1,613 )
Sale of treasury shares
Dividends on treasury shares
Other adjustments
(5 )
(5 )
(5 )
Total equity transactions
(2,581 )
(2,581 )
(2,581 )
Equity at 31 March 2024
(633 )
Statement of changes in equity at 31 March 2023
Attributable to shareholders of DSV A/S
(DKKm)
Share
capital
Reserves
Retained
earnings
Total
Non-
controlling
interests
Total
equity
Equity at 1 January 2023
Profit for the period
Other comprehensive income, net of tax
(899 )
(68 )
(967 )
(2 )
(969 )
Total comprehensive income for the period
(899 )
Transactions with shareholders and
non-controlling interests:
Share-based payments
Tax on share-based payments
Dividends distributed
(1,424 )
(1,424 )
(24 )
(1,448 )
Purchase of treasury shares
(3 )
(3,016 )
(3,019 )
(3,019 )
Sale of treasury shares
Dividends on treasury shares
Total equity transactions
(1 )
(3,314 )
(3,315 )
(24 )
(3,339 )
Equity at 31 March 2023
Page 21 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Notes to the interim financial
statements
1 Material accounting policy information
This Interim Financial Report has been prepared in accordance
with IAS 34 ‘Interim Financial Reporting’ as adopted by the
European Union and additional disclosure requirements for
listed companies under the Danish Financial Statements Act.
Material accounting policy information applied in preparing the
Interim Financial Report are consistent with those applied in
preparing the DSV Annual Report 2023. The DSV Annual
Report 2023 provides a full description of the Group’s
accounting policies.
Changes in accounting policies
The DSV Group has implemented amendments to the IFRS
Accounting Standards effective as of 1 January 2024 as
adopted by the European Union.
None of the amendments implemented have had any material
impact on the Group’s financial statements, nor are they
expected to have so in the foreseeable future.
2 Management judgements and
estimates
In preparing the interim financial statements, Management
makes various accounting judgements and estimates that affect
the reported amounts and disclosures in the financial statements
and in the notes to the statements. These are based on
professional experience, historical data and other factors
available to Management.
By nature, a degree of uncertainty is involved when carrying
out these judgements and estimates, hence actual results
may deviate from the assessments made at the reporting
date. Judgements and estimates are continuously evaluated,
and the effects of any changes are recognised in the
relevant period.
Primary financial statement items in which more significant
accounting judgements and estimates are applied are listed in
Chapter 1 of the Notes to the 2023 DSV Annual Report to which
is referred.
3 New accounting regulations
The IASB has issued a number of new standards and
amendments not yet in effect or adopted by the EU and
therefore not relevant for the preparation of the Q1 2024 Interim
Financial Report.
4 Segment information - divisions
Air & Sea
Road
Solutions
Non-allocated items
and eliminations
Total
(DKKm)
Q1 2024
Q1 2023
Q1 2024
Q1 2023
Q1 2024
Q1 2023
Q1 2024
Q1 2023
Q1 2024
Q1 2023
Condensed statement of profit or loss
Revenue
22,577
26,062
9,763
9,409
5,876
5,429
124
54
38,340
40,954
Intersegment revenue
139
151
662
685
113
196
(914)
(1,032)
-
-
Divisional revenue
22,716
26,213
10,425
10,094
5,989
5,625
(790)
(978)
38,340
40,954
Direct costs
16,953
19,186
8,461
8,118
3,588
3,340
(927)
(1,081)
28,075
29,563
Gross profit
5,763
7,027
1,964
1,976
2,401
2,285
137
103
10,265
11,391
Other external costs
908
1,023
324
363
437
453
(526)
(499)
1,143
1,340
Staff costs
1,943
2,093
937
902
650
588
560
527
4,090
4,110
Operating profit before amortisation,
depreciation (EBITDA) before special
items
2,912
3,911
703
711
1,314
1,244
103
75
5,032
5,941
Amortisation and depreciation
285
285
213
216
814
696
79
72
1,391
1,269
Operating profit (EBIT) before special
items*
2,627
3,626
490
495
500
548
24
3
3,641
4,672
Condensed statement of financial position
Total assets
82,720
89,919
26,245
25,147
34,499
29,599
8,559
10,107
152,023
154,772
Total liabilities
50,695
62,276
19,856
18,233
27,984
23,519
(15,426)
(19,976)
83,109
84,052
* Reference is made to the statement of profit or loss for reconciliation of operating profit (EBIT) before special items to profit for the period.
Page 22 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
5 Revenue
Services and geographical
segmentation of revenue (DKKm)
EMEA
Americas
APAC
Total
Q1 2024
Q1 2023
Q1 2024
Q1 2023
Q1 2024
Q1 2023
Q1 2024
Q1 2023
Air services
5,053
5,840
3,416
4,444
3,698
3,981
12,167
14,265
Sea services
5,287
5,871
3,405
4,016
1,857
2,061
10,549
11,948
Road services
9,553
9,190
872
904
-
-
10,425
10,094
Solutions services
4,006
3,644
1,196
1,147
787
834
5,989
5,625
Total
23,899
24,545
8,889
10,511
6,342
6,876
39,130
41,932
Non-allocated items and eliminations
(790)
(978)
Total revenue
38,340
40,954
6 Financial instruments – fair value hierarchy
Derivative financial instruments
DSV has no financial instruments measured at fair value based
on level 1 input (quoted active market prices) or level 3 input
(non-observable market data). Derivative financial instruments
are measured based on level 2 input (input other than quoted
prices that are observable either directly or indirectly). The fair
value of currency derivatives is determined based on generally
accepted valuation methods using available observable market
data. Calculated fair values are verified against comparable
external market quotes on a monthly basis.
Issued bonds
The fair value of issued bonds measured at amortised cost is
within level 1 of the fair value hierarchy.
Overdraft and credit facilities
The carrying amount of overdraft and credit facilities measured
at amortised cost is not considered to differ significantly from the
fair value.
Trade receivables, trade payables and other receivables
Receivables and payables pertaining to operating activities with
short churn ratios are considered to have a carrying amount
equal to fair value.
Cash and cash equivalents
The carrying amount of cash and cash equivalents is not
considered to differ significantly from the fair value.
31 March 2024
31 December 2023
(DKKm)
Carrying amount
Fair Value
Carrying amount
Fair Value
Financial assets:
Currency derivatives
18
18
37
37
Trade receivables
24,303
24,303
22,296
22,296
Other receiveables
6,884
6,884
6,744
6,744
Cash and cash equivalents
6,514
6,514
6,452
6,452
Tax on items reclassified to the profit or loss
37,701
37,701
35,492
35,492
Financial liabilities
Currency derivatives
13
13
-
-
Issued bonds measured at amortised cost
21,970
18,172
21,450
18,364
Overdraft and credit facilities
2,389
2,389
677
677
Trade payables
14,297
14,297
13,111
13,111
Financial liabilities measured at amortised cost
38,656
34,858
35,238
32,152
Page 23 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
7 Share options schemes
DSV has launched a new 2024 share-based payment incentive
scheme with the purpose of motivating and retaining key
employees across the organisation and aligning the interests of
these with our shareholders. Share options are awarded to key
employees and Executive Management.
Share options are granted pursuant to the DSV Remuneration
Policy as adopted at the Extraordinary General Meeting held on
8 September 2021.
The share options granted are equity-settled and can be
exercised by cash purchase of shares only during the exercise
period. The obligation relating to the share options scheme is
covered by the Company’s treasury shares.
The exercise price of share options granted amounts to DKK
1,106 and has been determined based on the average quoted
market price of the DSV share for the last five trading days
leading up to the date of grant at 31 March 2024.
The fair value of the 2024 share options granted amounts to
DKK 396 million and has been determined based on a Black &
Scholes valuation model.
Key assumptions applied in the valuation are:
Vesting period
01.04.2024-31-03.2027
Exercise period
01.04.2027-31-03.2029
Number of employees included
2,195
Number of options granted:
Executive Board
116,945
Key employees
1,900,220
Total
2,017,165
Value assumptions:
Exercise price
1,106
Volatility (%)
20
Risk-free interest rate (%)
2.97
Expected dividend (%)
0.80
Expected remaining life (years)
3.5
Page 24 of 24 INTERIM FINANCIAL REPORT – COMPANY ANNOUNCEMENT NO. 1103 – 24 April 2024
Statement by the Board of Directors
and the Executive Board
The Board of Directors and the Executive Board have today considered and adopted the Interim Financial Report of DSV A/S for the
three-month period ended 31 March 2024.
The Interim Financial Report, which has not been audited or reviewed by the Company’s auditor, has been prepared in accordance
with IAS 34 ‘Interim Financial Reporting’ as adopted by the European Union and additional requirements in accordance with the
Danish Financial Statements Act.
In our opinion, the Interim Financial Statements give a true and fair view of the financial position on 31 March 2024 and the profit or
loss and cash flows of the Group for the three-month period ended 31 March 2024.
We also find that the Management’s commentary provides a fair statement of developments in the activities and financial situation of
the Group, financial results for the period, the general financial position of the Group and a description of the major risks and
elements of uncertainty faced by the Group. Aside from the disclosures in the Interim Financial Report, no changes in the Group’s
most significant risks and uncertainties have occurred relative to the disclosures in the Annual Report for 2023.
Executive Board:
Board of Directors: