Interim Q4 2020 and Full-year Report
ANOTHER STRONG
QUARTER FOR FREIGHT
• Passenger services remained restricted
• Freight earnings boosted by UK stockbuilding
• Mediterranean route network improved performance
• 2021 EBITDA outlook range of DKK 3.0-3.5bn
• Financial leverage, NIBD/EBITDA, expected to decrease in 2021
2020
2020
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Q4 2020
• Q4 EBITDA on level with 2019
• Freight earnings up DKK 186m
• Free cash flow of DKK 444m
• NIBD/EBITDA lowered to 4.2
Outlook 2021 (incl. HSF Logistics
Group from 1 May)
• EBITDA of DKK 3.0-3.5bn
• Revenue growth of 20-25%
• Investments of around DKK 2.8bn
• NIBD/EBITDA to decrease around
0.5 ppt
“With the effects of Brexit and the
pandemic hopefully soon behind us, our
focus increasingly turns to delivering on
our long-term growth ambitions.”
Torben Carlsen, CEO
Revenue decreased 6% to DKK 3.8bn in Q4 and EBITDA
before special items of DKK 769m was on level with 2019.
The result for freight ferry and logistics activities linked to
the UK was boosted by extensive stockbuilding ahead of
Brexit. In addition, volumes and earnings continued to
improve in the Mediterranean business unit. Total EBITDA
for freight ferry and logistics activities was DKK 186m
above 2019 in Q4.
Tight travel restrictions were in place throughout Q4 and
passenger volumes remained subdued in the quarter. In
Q4, EBITDA for passenger services was DKK 186m below
2019. This result includes the passenger services in three
business units – Passenger, Channel and Baltic Sea.
Outlook 2021
Uncertainty is elevated going into 2021 due to low
visibility on the duration of travel restrictions linked to
the pandemic. Longer term effects of Brexit have also yet
to emerge. The acquisition of HSF Logistics Group is
subject to regulatory approval but assumed consolidated
from 1 May 2021.
On this background, revenue is expected to grow by
20-25% and EBITDA before special items is expected to be
within a range of DKK 3.0-3.5bn (2020: DKK 2.7bn).
The outlook is detailed on page 9.
Highlights Q4
10 February 2021. Conference call today at 10.00am CET
Access code: 81772821# Phone numbers to the call: DK +45 35445577, US +1 631 913 1422, UK +44 333 300 0804
KEY FIGURES
2020
2019
2020
2019
DKK m
Q4
Q4
Change, %
Full year
Full year
Change, %
Revenue
3,761
4,008
-6.2
13,971
16,592
-15.8
EBITDA before special items
769
771
-0.2
2,732
3,633
-24.8
EBIT before special items
289
257
12.5
858
1,751
-51.0
Profit before tax and special items
194
181
7.2
583
1,472
-60.4
Profit before tax
97
126
-23.4
466
1,371
-66.0
2020
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2020
2019
2020
2019
DKK m
Q4
Q4
Full year
Full year
Income statement
Revenue
3,761
4,008
13,971
16,592
• Ferry Division*
2,602
2,891
9,678
12,197
• Logistics Division*
1,382
1,303
5,069
5,116
• Non-allocated items
106
134
491
540
• Eliminations*
-328
-320
-1,268
-1,262
Operating profit before depreciation (EBITDA) and special items
769
771
2,732
3,633
• Ferry Division*
676
678
2,332
3,254
• Logistics Division*
114
112
445
421
• Non-allocated items
-21
-19
-45
-42
Profit/loss on disposal of non-current
assets, net
0
2
5
6
Operating profit (EBIT) before
special items
289
257
858
1,751
Special items, net
-97
-55
-117
-101
Operating profit (EBIT)
192
203
741
1,650
Financial items, net
-95
-76
-275
-278
Profit before tax
97
126
466
1,371
Profit for the period
109
128
442
1,313
Profit for the period excluding
non-controlling interest
106
127
433
1,309
Capital
Total assets
-
-
27,006
26,863
DFDS A/S' share of equity
-
-
10,511
10,276
Equity
-
-
10,600
10,356
Net interest-bearing debt
-
-
11,361
11,954
Invested capital, end of period
-
-
22,121
22,476
Invested capital, average
22,267
22,101
22,500
20,927
2020
2019
2020
2019
DKK m
Q4
Q4
Full year
Full year
Cash flows
Cash flows from operating activities, before financial items and after tax
797
808
2,772
3,258
Cash flows from investing activities
-192
-777
-1,618
-2,651
• Acquisition of enterprises and activities
0
-127
-14
-131
• Other investments, net
-192
-649
-1,603
-2,519
Free cash flow
605
31
1,155
607
Repayment of lease liabilities and lease interest
-161
-209
-679
-785
Adjusted free cash flow
444
-177
475
-178
Key operating and return ratios
Average number of employees
-
-
8,213
8,367
Number of ships
-
-
70
70
Fuel consumption per nautical mile (g/GT/Nm)
4.18
4.75
4.25
4.78
Revenue growth (reported), %
-6.2
1.3
-15.8
5.6
EBITDA-margin, %
20.5
19.2
19.6
21.9
Operating margin, %
7.7
6.4
6.1
10.6
Revenue/invested capital average, (times)
-
-
0.6
0.8
Return on invested capital (ROIC), %
-
-
3.0
7.6
ROIC before special items, %
-
-
3.5
8.1
Return on equity, %
-
-
4.2
13.5
Key capital and per share ratios
Equity ratio, %
-
-
39.3
38.6
Net interest bearing debt/EBITDA, (times)
-
-
4.2
3.3
Earnings per share (EPS), DKK
1.85
2.21
7.56
22.88
Dividend paid per share, DKK
0.00
0.00
0.00
4.00
Number of shares, end of period, '000
-
-
58,632
58,632
Weighted average number of circulating shares, '000
-
-
57,310
57,196
Share price, DKK
-
-
275.2
325.0
Market value
-
-
15,790
18,593
*The Norwegian sideport shipping activities have been transferred from the Logistics Division to the Ferry Division per
1 January 2020, 2019 comparative figures have been restated accordingly.
Definitions on page 29.
Key figures
2020
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Market overview
The pickup in European freight markets that began in Q3
2020 continued into Q4. Trading of goods between UK and
the rest of Europe was in addition boosted by UK
stockbuilding in Q4, especially in the last two months of
the quarter.
Freight volumes also continued to pick up and stabilise in
the Baltic and Mediterranean regions that were not
materially impacted by Brexit.
During December stockbuilding in the UK intensified. This
caused congestion in and around ports as volumes
exceeded the capacity of the transport sector, including
shortages of drivers and equipment.
Trade volumes in January 2021 between the EU and the
UK were as expected below normal levels. This reflects
the extensive stockbuilding in Q4 2020, a wait-and-see
approach of market participants and a number of teething
issues related to implementation of new rules and
processes. It will likely take some months for the market
to adapt to the new rules and processes. Trading volumes
in Q1 2021 are therefore expected to be considerably
lower than in the same quarter last year.
Economic growth continued to pick up in Turkey through
Q4 driven by higher industrial production and
consumption as well as growth in both imports and
exports. Turkey’s currency TRY stabilised during Q4 at a
low level that is supportive of growth in Turkish exports.
The European ferry travel market remained as expected
subdued in Q4 2020 due to the tight travel restrictions in
place.
The main changes in average exchange rates in Q4 2020
vs Q4 2019 were depreciation of TRY/DKK by 32%,
NOK/DKK by 7% and GBP/DKK by 5%.
Major events in Q4
New 6-year agreement between DFDS and Danish
Defence
DFDS and the Joint Movement and Transport Organisation
(JMTO), which provides strategic transport for Danish
military missions, entered on 24 November into a new
agreement. Seven freight ferries (ro-ro) will be made
available for the maritime transport of military materiel
and equipment in connection with NATO preparedness,
participation in military exercises and operations, and
humanitarian crises. The agreement, concluded after the
task went out to public tender, replaces an earlier
agreement between the Danish Defence and DFDS, and
runs for six years.
DFDS in partnership to develop hydrogen ferry
DFDS partnered up with a group of companies in 2020 to
develop a 100% hydrogen powered ferry for initially the
Oslo-Frederikshavn-Copenhagen route.
On 26 November 2020, the partnership applied for
support from EU’s Innovation Fund to develop a ferry
powered by electricity from a hydrogen fuel cell system,
capable of producing up to 23 MW, emitting only water.
Green hydrogen for the ferry is envisioned to be produced
by a projected offshore wind energy-powered electrolyser
plant in Greater Copenhagen based on offshore wind.
Award of shares to all employees
On 22 December 2020, each employee was awarded 50
shares in recognition of their contribution in a year with
exceptional challenges. The award is exempt for managers
with existing sharebased remuneration.
The 50 shares will vest over a three year period thereby
incentivising employees in coming years. The total number
of employees eligible for the award of shares is around
8,000 and the total value of awarded shares is around
DKK 110m at today’s share price.
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Capacity agreement with UK’s Department for Transport
(DfT)
In October, DFDS entered into an agreement with the UK’s
DfT to ensure ferry freight capacity for vital goods such as
medicine and food after the Brexit transition period ends
on 31 December 2020. The agreement runs for six months
starting 1 January 2021. The agreement comprises the
Dieppe-Newhaven and Rotterdam-Felixstowe routes.
Major events after Q4
New direct ferry route between Ireland and France/
Continental Europe
To facilitate trade between Ireland and continental
Europe, a new freight ferry route was opened on 2 January
2021 between Rosslare in Ireland and Dunkirk in Northern
France. The route bypasses the UK to offer trucks and
drivers direct and paperless transport between EU
countries. The route is expected to reach revenues above
DKK 300m in 2022. The route is jointly owned by DFDS
and Irish interests.
DFDS creates leading provider of cold chain logistics
On 26 January 2021, DFDS entered into an agreement to
acquire 100% of HSF Logistics Group. The company is one
of Europe’s leading cold chain logistics providers to meat
producers and other food producers that operates
temperature-controlled supply chains.
The Group operates four brands with HSF Logistics a
leading brand in the Netherlands, Germany and the UK.
N&K Spedition and Skive Køletransport are leading brands
in Denmark and Scandinavia, together constituting around
half of the revenue of the Group. Eurofresh is a brand
focused on the German market.
DFDS has agreed to acquire the HSF Logistics Group for a
debt-free price of DKK 2.2bn (EUR 296m). The HSF
Logistics Group has revenue of DKK 2.8bn and an EBITDA
of DKK 320m (before adjusting for IFRS 16). The company
has 1,800 employees and operates around 700 trucks and
1,700 reefer trailers, including both owned and leased
units.
The acquisition of HSF Logistics Group is aligned with
DFDS’ Win23 strategy of growing solutions to selected
industries, including cold chain logistics customers.
Closing of the transaction is expected to take place in
around three months subject to regulatory approval and
completion of required employee consultation processes.
More information on the transaction is available from this
link.
Oslo-Frederikshavn-Copenhagen route suspended
In November 2020, one of the two ferries deployed on
Oslo-Frederikshavn-Copenhagen was laid up and in
January 2021 the second ferry was laid up due to the
continued tight travel restrictions. The route will be
reopened once passengers are allowed to travel again.
Sixth and final mega freight ferry delivered
The sixth and final freight ferry newbuilding in a series
arrived early February in Europe from China. The freight
ferry will be deployed between Sweden and Belgium.
Win23: Strategic and financial
ambitions set for 2023
DFDS’ ambition to continue growing revenue and earnings
considerably over the next three years builds on the
Win23 strategy that has four pillars:
A. Grow solutions to select industries
B. Digitise services to accelerate growth
C. Develop and expand the ferry and logistics networks
D. Create more value for passengers.
ROIC before special items was 4% in 2020 while DFDS’
minimum return target is 8%. The financial ambition of
Win23 is to reach a return on invested capital (ROIC) of
10% in 2023.
All four pillars include initiatives that will contribute to
raising ROIC. Of particular importance is Pillar C’s
fulfillment of the business plan for the Mediterranean
business unit that reported a ROIC of 2.4% in 2020 based
on invested capital of DKK 9.5bn at year-end. The latter
equals 43% of the Group’s total invested capital.
Pillar D covers passenger services. The potential to raise
ROIC linked to passenger services is considerable as this
pillar is focused on regaining the drop in EBITDA of
2020
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DKK 1bn caused by Covid-19 in 2020 compared to 2019.
A prerequisite for this to happen is the return of
passengers in large numbers to the routes on the English
Channel, between Norway and Denmark, and between the
Netherlands and the UK.
Financial performance
Revenue
The Group’s Q4 revenue was DKK 3,761m, a decrease of
6.2% compared to 2019.
Ferry Division’s Q4 revenue decreased 10.0% to
DKK 2,602m as travel restrictions reduced passenger
revenue across business units by DKK 369m or 71.3%.
Freight ferry revenue across business units was up 11.0%,
excluding bunker surcharges, as freight ferry volumes were
13.3% above 2019. In the Channel and North Sea business
units freight revenue was boosted by the UK stockbuilding
ahead of Brexit. Moreover, Mediterranean’s revenue
increased 16% driven by higher volumes and higher
revenue from rail services.
Logistics Division’s Q4 revenue increased 6.1% to
DKK 1,382m as a positive impact from acquisitions and
UK stockbuilding was partly offset by a reduction in
volumes linked to Covid-19, including lower automotive
volumes. Q4 logistics volumes increased 2.2% compared
to 2019.
The Group’s full-year revenue decreased 15.8% compared
to 2019 to DKK 13,971m. Ferry Division’s full-year
revenue decreased 20.7% to DKK 9,678m and Logistics
Division’s full-year revenue decreased 0.9% to DKK
5,069m.
Operating profit before depreciation (EBITDA) and
special items
The Group’s Q4 EBITDA of DKK 769m was on level with
2019.
Ferry Division’s Q4 EBITDA of DKK 676m was on level with
2019 as higher freight earnings offset lower passenger
earnings.
The freight ferry activities increased EBITDA by DKK 184m
driven mainly by a positive impact on volumes from the
UK stockbuilding in the North Sea and Channel business
units. In addition, Mediterranean’s result was improved by
a combination of higher volumes and lower operating
costs.
The EBITDA for the passenger activities was DKK 186m
below 2019 due to the severe reduction in the number of
passengers. The decrease was due to a lower result in the
Passenger and Channel business units while Baltic Sea’s
passenger result was on level with 2019.
Logistics Division’s Q4 EBITDA increased 2% to
DKK 114m. The results for the Nordic and Continent
business units were both improved by a positive impacts
from the UK stockbuilding and acquisitions. UK & Ireland’s
EBITDA was reduced by extra costs, including a one-off
cost of DKK 10m related to a cold chain warehouse.
The Group’s full-year EBITDA decreased 25% to
DKK 2,732m following a decrease in Ferry Division's
EBITDA of 28% to DKK 2,332m and an increase in
Logistics Division's EBITDA of 5% to DKK 445m. Non-
allocated corporate costs of DKK -45m was on level with
2019.
The Group’s result includes compensations of DKK 133m
from government Covid-19 programs. In Q4 2020, a fixed
cost compensation of DKK 50m reported in Q2 2020 was
reversed as it was decided to withdraw the application for
the compensation in view of the earnings recovery in the
second half of 2020.
Revenue
DKK m
Q4 2020
Q4 2019
Change, %
Change
Ferry Division*
2,602
2,891
-10.0
-289
Logistics Division*
1,382
1,303
6.1
79
Non-allocated items
106
134
-21.2
-28
Eliminations
-328
-320
-2.7
-9
DFDS Group
3,761
4,008
-6.2
-247
* The Norwegian sideport shipping activities have been transferred from the Logistics Division to the Ferry Division per 1 January 2020, 2019 comparative figures
have been restated accordingly.
2020
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Depreciation and operating profit (EBIT) before
special items
Depreciation in Q4 of DKK 480m decreased 7% compared
to 2019 as redelivery of chartered freight ferries offset
the increase in depreciation from freight ferry
newbuildings. Depreciation for the full-year was DKK
1,873m, a decrease of 1% compared to 2019.
The Group’s Q4 EBIT before special items increased 13%
to DKK 289m. The Group’s full-year EBIT before special
items decreased 51% to DKK 858m.
Special items and operating profit (EBIT) after special
items
In Q4 2020, special items were a net cost of DKK 97m.
This includes impairments of DKK 100m related to assets
deployed by the Oslo-Frederikshavn-Copenhagen route
and DKK 29m related to a freight ferry held for sale.
Redundancy costs of DKK 27m were reversed in the
quarter as fewer employees were laid off in the Channel
business unit than previously expected.
Special items for the full-year was a cost of DKK 117m.
This includes the mentioned impairments in Q4,
redundancy costs of DKK 102m and an accounting gain of
DKK 110m on the sale of a combined freight and
passenger ferry.
The Group’s Q4 EBIT after special items decreased 5% to
DKK 192m. The Group’s full-year EBIT after special items
decreased 55% to DKK 741m.
* Comparative 2018 numbers are restated to IFRS 16 on a proforma and unaudited basis
Operating profit before depreciation (EBITDA) & special items
DKK m
Q4 2020
Q4 2019
Change, %
Change
Ferry Division*
676
678
-0.3
-2
Logistics Division*
114
112
1.8
2
Non-allocated items
-21
-19
10.8
-2
DFDS Group
769
771
-0.2
-2
EBITDA-margin, %
20.5
19.2
n.a.
1.2
* The Norwegian sideport shipping activities have been transferred from the Logistics Division to the Ferry Division per 1 January 2020, 2019 comparative figures
have been restated accordingly.
Associates and joint ventures, profits on disposals and depreciation
DKK m
Q4 2020
Q4 2019
Change, %
Change
EBITDA before special items
769
771
-0.2
-2
Associates and joint ventures
0
-1
n.a.
1
Profit on disposals
0
2
n.a.
-2
Depreciation and impairment
-480
-515
6.9
35
EBIT before special items
289
257
12.5
32
Financial items
DKK m
Q4 2020
Q4 2019
Change, %
Change
Interests, net
-72
-59
-21.9
-13
Foreign exchange gains/losses, net
-18
-13
-37.5
-5
Other items, net
-5
-3
-32.8
-1
Total finance, net
-95
-76
-25.1
-19
0
100
200
300
400
500
600
700
800
900
1.000
1.100
1.200
1.300
Q1 Q2 Q3 Q4
DKK m
DFDS GROUP - EBITDA BEFORE SPECIAL ITEMS
2018* 2019 2020
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Financial items
Total finance, net in Q4 was a cost of DKK 95m which was
an increase of DKK 19m compared to Q4 2019. The net
interest cost increased DKK 13m above 2019 mainly due
to costs related to a temporary waiver of loan covenants.
Total finance, net for the full-year was a cost of
DKK 275m which was on level with 2019.
Profit before special items and tax
The Q4 profit before special items and tax increased 7% to
DKK 194m. The profit for the period decreased 15% to
DKK 109m.
For the full-year, the profit before special items and tax
decreased 60% to DKK 583m and the profit for the period
decreased 66% to DKK 442m.
Earnings per share
Q4 earnings per share (EPS) decreased to DKK 1.85
compared to DKK 2.21 in Q4 2019. For the full-year,
earnings per share (EPS) decreased to DKK 7.56 compared
to DKK 22.88 in 2019.
Cash flow and investments
The Q4 cash flow from operating activities was
DKK 796m. The full-year cash flow from operating
activities was DKK 2,769m.
The Q4 free cash flow (FCFF) was DKK 605m and
DKK 444m adjusted for payment of lease liabilities
including interest. Net investments in Q4 amounted to a
negative cash flow of DKK 192m that included DKK 169m
of ferry investments. The full-year free cash flow (FCFF)
was DKK 1,155m and DKK 475m adjusted for payment of
lease liabilities including interest. This included
investments of DKK 1,603m of which DKK 1,422m was
ferry investments with newbuildings amounting to
DKK 916m.
The Q4 cash flow from financing activities was positive by
DKK 6m. This included a net cash flow from loans of DKK
206m, payment of lease liabilities of DKK -141m and a
cash outflow of DKK 60m due to two associated
companies’ withdrawal from the Group’s cash pool. The Q4
net cash flow was positive by DKK 527m and cash and
cash equivalents thus increased to DKK 1,261m at year-
end.
Invested capital and ROIC
Invested capital was DKK 22.1bn at the end of Q4 2020
which was 2% lower than at year-end 2019. The average
invested capital in Q4 2020 increased 6% to DKK 22.3bn
compared to 2019.
The return on invested capital, ROIC, for 2020 was 3.5%
before special items compared to 8.1% for 2019.
Capital structure
At the end of Q4 2020 net-interest-bearing debt (NIBD)
was DKK 11.4bn, a decrease of 5% compared to year-end
2019 and a 3% decrease compared to the end of Q3 2020.
Financial leverage, as measured by the ratio of NIBD to
EBITDA before special items, was a ratio of 4.2 compared
to 3.3 at year-end 2019.
Equity
Equity amounted to DKK 10,600m at year-end 2020,
including non-controlling interests of DKK 89m. This was
an increase of 2% compared to year-end 2019. Total
comprehensive income for 2020 was DKK 236m. There
were no material transactions with owners in 2020.
The equity ratio was 39% at year-end 2020 which was on
level with year-end 2019.
2020
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Outlook 2021
The level of visibility continues to be below normal levels
for mainly two reasons: the Covid-19 pandemic and 2021
being the first year post Brexit with longer term effects of
the transition yet to emerge. Uncertainty is therefore
elevated going into 2021.
The outlook for 2021 builds on a number of assumptions
that may change significantly as the year progresses.
General market growth prospects
The consensus outlook for GDP-growth (Gross Domestic
Product) in Europe and Turkey predicts that growth will
resume in 2021 after a decrease in GDP in 2020. The
consensus outlook thereby assumes that the negative
impact of Covid-19 will be less in 2021 than in 2020. It
also reflects continued support from EU monetary and
fiscal policies.
Turkey’s economy, and in particular its trading with
Europe, is linked to the development in demand on
European markets that is expected to grow. Turkey’s
export is also expected to benefit from the depreciation of
TRY vs EUR. Longer term, Turkey should gradually benefit
from nearshoring of manufacturing from overseas region
as companies consider reducing risks of supply chain
disruptions. Geopolitical issues involving Turkey could
dampen the expected growth, both short and long term.
The current consensus estimate for European real GDP
growth in 2021 is around 5.5%, including growth of 4.2%
for UK and 4.5% for Turkey. (Source: Thomson Reuters).
Key outlook freight assumptions for 2021
As expected, 2021 has started with a considerable
decrease in freight ferry and logistics volumes related to
the UK following the extended stockbuilding in Q4 2020.
Due to the uncertainty linked to the first year post Brexit,
visibility on the earnings outlook for business units
facilitating trade with the UK and trading in the UK is low.
Earnings in 2021 for UK-linked activities are therefore
expected to be below 2020.
The Mediterranean business unit is expected to improve
earnings in 2021 driven by volume growth and more
efficient operations.
In the Baltic region, freight ferry capacity and competition
increased in the second half of 2020. This is expected to
continue with lower earnings from ferry services in 2021
compared to 2020.
Key outlook assumptions for HSF Logistics Group
The acquisition of HSF Logistics Group is expected to be
consolidated from 1 May 2021 subject to regulatory
approval. For eight months in 2021, the Group’s revenue is
expected to be around DKK 1.9bn and EBITDA before
special items around DKK 250m.
Key outlook passenger assumptions for 2021
The EBITDA for passenger services across business units -
Passenger, Channel and Baltic Sea - was reduced by
around DKK 1bn in 2020 due to travel restrictions
imposed to limit the spread of Covid-19.
It is initially assumed that around 40% of the decrease in
2020 is regained in 2021. The current most likely scenario
is that travel restrictions will continue to limit travel in
the first half of 2021 while some easing of restrictions are
expected in the second half of the year.
OUTLOOK 2021*
DKK m
Outlook 2021
2020
Revenue growth
20-25%
13,971
EBITDA before special items
3,000-3,500
2,732
Per division:
Ferry Division
2,300-2,700
2,332
Logistics Division
750-850
445
Non-allocated items
-50
-45
EBIT before special items
1,000-1,500
858
Investments
-2,800
-1,618
*Including acquisition of HSF Logistics Group from 1 May
2020
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Contact
Interim Q4 2020 and Full-year Report / p 10
The high season for ferry travel is Q3 and the outlook is
thus especially sensitive to the scope of restrictions in this
quarter.
Revenue outlook
The Group’s revenue is expected to increase by 20-25%
compared to 2020.
The main growth drivers are the addition of HSF Logistics
Group, the opening of a new route between Ireland and
France and an increase in passenger volumes.
EBITDA outlook before special items
Based on the assumptions described above, the Group’s
EBITDA before special items is expected to be within a
range of DKK 3.0-3.5bn (2020: DKK 2.7bn). See the
outlook table for a divisional split.
EBIT outlook before special items
The Group’s EBIT before special items is expected to be
within a range of DKK 1,000-1,500m (2020: DKK 858m).
Investments
Investments of around DKK 2.8bn are expected in 2021 of
which DKK 0.9bn is the initial payment for HSF Logistics
Group.
One new freight ferry (ro-ro) was delivered in February
2021 and in Q4 the first of two new combined freight and
passenger ferries (ro-pax) is scheduled for delivery. The
second is planned for delivery in 2022.
Investments in 2021 are expected to comprise:
• Acquisition of HSF Logistics Group: DKK 930m
• Ferry newbuildings: DKK 800m
• Dockings and ferry upgrades: DKK 500m
• Port terminals and other equipment: DKK 200m
• Cargo carrying equipment and warehouses, mainly
related to Logistics Division: DKK 250m
• Other investments, including IT and digital: DKK 150m.
Various risks and uncertainties pertain to
the outlook.
The most important among these are
possible major changes in the demand
for ferry – freight and passengers - and
logistics services. For DFDS, such
demand is to a large extent linked to the
level of economic activity in primarily
Europe, especially northern Europe and
in particular the UK, as well as adjacent
regions, particularly Turkey.
Demand can also be impacted by
competitor actions and extraordinary
events such as virus outbreaks. Covid-19
continues to constitute a significant risk,
particularly for passenger services.
The outlook can moreover be impacted
by political changes, first and foremost
within EU and Turkey. The introduction
of a new trade agreement between the
EU and the UK constitutes an important
risk.
Changes in economic variables,
especially the oil price and exchange
rates, can furthermore impact earnings.
Future financial results may therefore
differ significantly from expectations.
2020
Management review
Ferry
Logistics
Reports
Financials
Contact
Interim Q4 2020 and Full-year Report / p 11
Helping customers with Brexit
A new direct ferry link between Rosslare in Ireland and
Dunkirk in France was opened on 2 January 2021 to offer
customers a hasslefree alternative to driving through the UK.
2020
Management review
Ferry
Logistics
Reports
Financials
Contact
Interim Q4 2020 and Full-year Report / p 12
The division is organised in five
business units:
• North Sea
• Baltic Sea
• Channel
• Mediterranean
• Passenger
Q4 market, activity and result trends
Total Q4 freight volumes increased 13.3% compared to
2019 and increased by 14.7% adjusted for a structural
route change in Baltic Sea.
Total Q4 passenger volumes decreased 81.2% compared
to 2019 due to the tight travel restrictions that were in
place throughout the quarter.
North Sea
Q4 freight volumes were up 15.9% compared to 2019. The
UK stockbuilding ahead of Brexit boosted volumes on the
routes calling the UK, particularly between Netherlands
and UK. Volumes peaked during December which created
some congestion and extra costs in the UK ports. Volumes
between Sweden and Belgium were also higher helped by
higher automotive volumes.
Q4 EBITDA increased 12% to DKK 350m mainly driven by
a positive impact from the higher volumes on both ferry
routes and in port terminals. Due to the extraordinary
spike in the oil price spread in Q4 2019, the net bunker
cost was higher than in 2019.
Baltic Sea
Q4 freight volumes were up 10.4% compared to 2019
adjusted for a route change. The volume increase was
primarily due to an increase in capacity between Estonia
and Sweden. In the mid-Baltic market competition
increased as capacity was added on competing and
adjacent routes. Although passenger travel was restricted
to essential travel, volumes were on level with 2019 as
more passengers between Estonia and Finland offset
lower volumes on other routes.
Q4 EBITDA decreased 32% to DKK 80m. Due to the
extraordinary spike in the oil price spread in Q4 2019, the
net bunker cost was higher than in 2019. In addition, the
ferry operating costs were higher as capacity was
increased on several routes.
Ferry Division
Ferry Division
2020
2020
2019*
2019*
DKK m
Q1
Q2
Q3
Q4
Full year
Q1
Q2
Q3
Q4
Full year
Revenue
2,692
1,858
2,526
2,602
9,678
2,755
3,151
3,401
2,891
12,197
EBITDA before special items
528
393
735
676
2,332
591
892
1,093
678
3,254
Share of profit/loss of associates and
joint ventures
-2
-2
-2
0
-5
2
6
-1
-1
6
Profit/loss on disposal of non-current assets, net
0
0
1
-1
0
1
0
1
0
2
Depreciation and impairment
-386
-368
-366
-391
-1,512
-370
-378
-394
-415
-1,558
EBIT before special items
140
23
367
285
815
223
520
698
263
1,704
EBIT margin before special items, %
5.2
1.2
14.5
10.9
8.4
8.1
16.5
20.5
9.1
14.0
Special items, net
0
79
-72
-105
-98
0
-6
4
-51
-53
EBIT
140
102
295
179
717
223
514
702
212
1,651
Invested capital, average **
20,214
20,235
20,275
20,259
20,222
18,895
19,318
19,598
19,901
19,421
ROIC before special items, % **
-
-
-
-
3.9
-
-
-
-
8.7
Average number of employees
-
-
-
-
5,452
-
-
-
-
5,766
Lane metres, '000
10,079
8,394
10,529
11,883
40,886
10,593
9,715
10,530
10,442
41,280
Tons, '000
194
166
138
166
664
174
185
201
205
766
Passengers, '000
579
152
578
186
1,498
732
1,390
2,004
991
5,116
* The Norwegian sideport shipping activities have been transferred from the Logistics Division to the Ferry Division per 1 January 2020, 2019 comparative figures
have been restated accordingly.
** Comparative numbers for 2019 includes elements that are based on 2018 numbers restated to IFRS 16 on a proforma and unaudited basis.
2020
Management review
Ferry
Logistics
Reports
Financials
Contact
Interim Q4 2020 and Full-year Report / p 13
Channel
Q4 freight volumes were 17.3% above 2019 as the market
was boosted by the UK stockbuilding ahead of Brexit.
Some market share was gained in the quarter as
competitor capacity was reduced. A new route between
Rosslare, Ireland, and Dunkirk, France, targeting mainly
accompanied freight was opened on 2 January 2021.
Q4 passenger volumes were down 81.1% as tight travel
restrictions were upheld throughout the quarter.
Q4 EBITDA increased 37% to DKK 129m as higher freight
earnings and cost savings offset a significant decrease in
the passenger result. The result includes start-up costs for
the new Irish route.
Mediterranean
Q4 freight volumes increased 7.3% driven by a general
uplift in trading between Turkey and Europe helped by the
depreciation of TRY that in recent months has benefited
Turkish export growth. The level of activity among
customers in the region surrounding the Mersin port in
southern Turkey continued to improve.
The volume growth was also supported by a
normalisation of customers’ trucking operations as air
travel restrictions for truck drivers were eased. The market
share versus land transport was stable during the quarter.
Q4 EBITDA increased 85% to DKK 230m driven by a
combination of higher volumes and lower ferry operating
costs which in 2019 was increased by, among other things,
scrubber installations. In addition, the utilisation of rail
services from Trieste was improved.
Passenger
Travel restrictions were tight throughout the quarter
which led to a decrease in passenger volumes of 93.5%.
Both ferries between Netherlands and UK remained
deployed in the quarter to support freight volumes. One of
two ferries were laid up on the route between Norway and
Denmark as freight volumes are lower on this route.
Q4 EBITDA decreased DKK 135m to DKK -143m due to the
severe drop in passenger numbers that led to a revenue
decrease of DKK 298m in the quarter.
Non-allocated items
These items primarily include external charter activities.
Q4 EBITDA decreased 20% to DKK 29m.
2020
Management review
Ferry
Logistics
Reports
Financials
Contact
Interim Q4 2020 and Full-year Report / p 14
Ferry Division
2020
2020
2019
2019
DKK m
Q1
Q2
Q3
Q4
Full year
Q1
Q2
Q3
Q4
Full year
North Sea*
Revenue
1,008
756
874
1,015
3,653
1,007
1,013
974
977
3,971
EBITDA before special items
295
253
287
350
1,185
323
343
306
312
1,284
EBIT before special items
147
122
158
196
623
189
201
145
143
679
Invested capital**
5,931
5,964
5,856
6,054
5,951
5,700
5,816
5,585
5,948
5,633
ROIC before special items, %**
-
-
-
-
10.3
-
-
-
-
11.9
Lane metres freight, '000
3,350
2,657
3,264
3,758
13,028
3,327
3,039
3,214
3,234
12,815
Tons, '000
194
166
138
166
664
174
185
201
205
766
Baltic Sea
Revenue
323
307
327
310
1,268
350
389
398
335
1,472
EBITDA before special items
97
119
138
80
434
82
135
162
117
497
EBIT before special items
57
78
95
39
268
40
97
125
83
345
Invested capital**
1,712
1,642
1,646
1,844
1,625
1,322
1,272
1,322
1,283
1,384
ROIC before special items, %**
-
-
-
-
16.4
-
-
-
-
24.7
Lane metres freight, '000
1,140
1,100
1,099
1,094
4,434
1,187
1,171
1,137
1,118
4,613
Passengers, '000
39
54
69
47
209
43
68
88
47
245
Channel
Revenue
512
361
573
566
2,012
571
638
846
622
2,678
EBITDA before special items
39
32
135
129
334
86
85
233
93
497
EBIT before special items
-22
-27
73
67
91
34
31
168
35
268
Invested capital**
1,811
1,779
1,677
1,573
1,713
1,979
1,854
1,845
1,727
1,830
ROIC before special items, %**
-
-
-
-
5.2
-
-
-
-
14.6
Lane metres freight, '000
4,404
3,939
5,016
5,672
19,031
4,902
4,311
4,945
4,837
18,995
Passengers, '000
367
98
406
119
989
468
936
1,490
627
3,520
Mediterranean
Revenue
581
331
529
631
2,071
515
567
555
542
2,179
EBITDA before special items
147
66
188
230
631
137
164
161
125
587
EBIT before special items
55
-26
90
126
245
46
80
76
29
231
Invested capital**
9,858
9,910
9,798
9,535
9,787
9,047
9,529
9,594
9,833
9,304
ROIC before special items, %**
-
-
-
-
2.4
-
-
-
-
2.4
Lane metres freight, '000
1,087
696
1,045
1,206
4,034
1,071
1,060
1,110
1,124
4,365
Passenger
Revenue
209
27
190
62
489
251
497
601
360
1,709
EBITDA before special items
-87
-101
-42
-143
-373
-67
127
194
-8
245
EBIT before special items
-130
-146
-75
-172
-524
-110
76
149
-57
59
Invested capital**
871
673
634
575
722
704
716
891
860
790
ROIC before special items, %**
-
-
-
-
-73.1
-
-
-
-
7.1
Lane metres freight, '000
99
2
104
154
359
106
133
124
129
491
Passengers, '000
173
3
104
21
300
222
386
426
317
1,351
Non-allocated items
Revenue
102
111
91
132
436
107
105
96
153
461
EBITDA before special items
39
24
28
31
122
31
37
36
38
143
EBIT before special items
32
23
27
29
112
23
34
34
31
123
The invested capital in the quarter is shown as per the end of the period.
For the full year, the invested capital is shown as an average.
* The Norwegian sideport shipping activities have been transferred from
the Logistics Division to the Ferry Division per 1 January 2020, 2019
comparative figures have been restated accordingly.
** Comparative numbers for full year 2019 includes elements that are
based on 2018 numbers restated to IFRS 16 on a proforma and unaudited
basis.
2020
Management review
Ferry
Logistics
Reports
Financials
Contact
Interim Q4 2020 and Full-year Report / p 15
The division is organised in three
business units:
• Nordic
• Continent
• UK & Ireland
Q4 market, activity and result trends
Total Q4 logistics volumes increased 2.2% compared to
2019. Higher volumes from the UK stockbuilding was
partly offset by lower UK domestic volumes and other
activities negatively impacted by Covid-19.
Nordic
Q4 transported units increased 15.0% mainly due to the
addition of volumes from the acquisition of a Finnish
company in Q4 2019. There was an uplift in volumes from
the UK stockbuilding in December but this was offset by
lower activity in other areas through the quarter.
Q4 EBITDA increased 64% to DKK 41m as all key markets
improved earnings. This included higher activity in
specialised services, improved efficiency in the Swedish
warehousing operation and a positive contribution from
the Finnish company acquired in 2019.
Continent
Q4 transported units increased 4.8% driven mainly by
stockbuilding volumes from Netherlands and Germany to
UK as well as improved performance of the special cargo
operations. In Belgium, volumes were below last year due
to a decrease in volumes from sectors exposed to Covid-
19, including automotive and airline catering. The door-
door container solutions between Netherlands and Ireland
were somewhat disrupted by capacity issues during the
quarter.
Q4 EBITDA increased 30% to DKK 39m due to improved
performance of the special cargo operation and a positive
impact from one-off costs in Belgium in 2019. Extra costs
were incurred to handle the UK stockbuilding volumes
which reduced the earnings impact. The addition of a
Dutch company acquired in 2019 also contributed to the
increase.
UK & Ireland
Q4 transported units decreased 7.2% driven by lower vo-
lumes in parts of the cold chain activities, including a
reduction in warehousing volumes and lower seafood
volumes to the catering sector. Scottish aquaculture
volumes were above 2019.
Q4 EBITDA decreased 40% or DKK 23m to DKK 34m. The
result includes a provision of DKK 10m related to a
warehouse taken over in Liverpool earlier in the year. In Q4
2019, the result included a positive one-off adjustment. In
addition, extra transport costs were incurred as the
stockbuilding created shortages in the market.
Logistics Division
Logistics Division
2020
2020
2019*
2019*
DKK m
Q1
Q2
Q3
Q4
Full year
Q1
Q2
Q3
Q4
Full year
Revenue
1,330
1,097
1,259
1,382
5,069
1,302
1,267
1,245
1,303
5,116
EBITDA before special items
91
94
145
114
445
101
101
106
112
421
Profit/loss on disposal of non-current assets, net
2
2
0
0
4
1
0
1
2
4
Depreciation and impairment
-73
-73
-73
-69
-289
-57
-57
-62
-80
-256
EBIT before special items
20
22
72
45
159
45
45
45
35
170
EBIT margin before special items, %
1.5
2.0
5.7
3.3
3.1
3.5
3.5
3.6
2.7
3.3
Special items, net
0
-4
-7
-1
-12
0
-6
0
0
-7
EBIT
20
18
65
45
147
45
38
45
35
163
Invested capital, average **
1,737
1,727
1,584
1,465
1,613
1,473
1,466
1,442
1,562
1,503
ROIC before special items, % **
-
-
-
-
7.7
-
-
-
-
9.2
Average number of employees
-
-
-
-
2,112
-
-
-
-
1,964
Units, '000
136
114
134
142
525
133
133
135
139
540
* The Norwegian sideport shipping activities have been transferred from the Logistics Division to the Ferry Division per 1 January 2020, 2019 comparative figures
have been restated accordingly.
** Comparative numbers for 2019 includes elements that are based on 2018 numbers restated to IFRS 16 on a proforma and unaudited basis.
2020
Management review
Ferry
Logistics
Reports
Financials
Contact
Interim Q4 2020 and Full-year Report / p 16
Logistics Division
2020
2020
2019
2019
DKK m
Q1
Q2
Q3
Q4
Full year
Q1
Q2
Q3
Q4
Full year
Nordic *
Revenue
444
359
378
445
1,625
412
407
365
397
1,581
EBITDA before special items
33
18
39
41
131
31
28
27
25
111
EBIT before special items
12
-2
18
21
50
16
12
12
8
48
Invested capital**
465
409
372
379
399
348
333
280
368
359
ROIC before special items, %**
-
-
-
-
10.3
-
-
-
-
11.4
Units, '000 ***
27.7
23.1
26.7
31.4
108.9
28.2
27.3
26.0
27.3
108.8
Continent
Revenue
625
516
597
653
2,391
643
609
612
618
2,483
EBITDA before special items
26
40
53
39
159
41
43
45
30
159
EBIT before special items
-4
12
28
13
49
14
17
16
3
50
Invested capital**
799
710
625
588
711
655
679
694
833
691
ROIC before special items, %**
-
-
-
-
5.2
-
-
-
-
5.7
Units, '000
58.4
48.0
56.5
61.6
224.5
62.4
60.3
59.4
58.7
240.9
UK & Ireland
Revenue
356
322
381
385
1,444
330
328
342
361
1,361
EBITDA before special items
32
36
53
34
155
29
31
33
57
151
EBIT before special items
11
12
26
11
61
15
15
18
24
72
Invested capital**
527
544
507
458
504
487
432
467
483
453
ROIC before special items, %**
-
-
-
-
9.3
-
-
-
-
12.8
Units, '000
49.9
42.6
50.3
49.0
191.8
42.3
45.3
50.0
52.8
190.5
Non-allocated items
Revenue
27
26
20
15
89
24
26
23
21
94
EBITDA before special items
0
0
0
0
0
0
0
0
0
0
EBIT before special items
0
0
0
0
0
0
0
0
-1
0
* The Norwegian sideport shipping activities have been transferred from the Logistics Division to the Ferry Division per 1 January 2020, 2019 comparative figures
have been restated accordingly.
** Comparative numbers for full year 2019 includes elements that are based on 2018 numbers restated to IFRS 16 on a proforma and unaudited basis.
*** Excluding volumes related to automotive Logistics contract.
The invested capital in the quarter is shown as per the end of the period. For the full year, the invested capital is shown as an average.
2020
Management review
Ferry
Logistics
Reports
Financials
Contact
Interim Q4 2020 and Full-year Report / p 17
Copenhagen, 10 February 2021
Management statement
Executive Board Torben Carlsen, CEO. Karina Deacon, CFO
Board of directors Claus Hemmingsen, Chair. Klaus Nyborg, Deputy Chair
Anders Götzsche, Jens Otto Knudsen, Jill Lauritzen Melby,
Jesper Hartvig Nielsen, Lars Skjold-Hansen, Dirk Reich, Marianne Dahl Steensen
2020
Management review
Ferry
Logistics
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Financials
Contact
Interim Q4 2020 and Full-year Report / p 18
2020
2019
2020
2019
DKK m
Note
Q4
Q4
Full year
Full year
Revenue
3
Costs
Ferry and other ship operation and maintenance
-675
-900
-2,569
-3,667
Freight handling
-662
-612
-2,383
-2,521
Transport solutions
-815
-766
-2,905
-2,994
Employee costs
-719
-788
-2,862
-3,077
Costs of sales and administration
-120
-171
-520
-699
Operating profit before depreciation (EBITDA) and special items
Share of profit/loss of associates and joint ventures
-1
-5
Profit/loss on disposal of non-current assets, net
Depreciation, ferries and other ships
-291
-320
-1,153
-1,225
Depreciation, other non-current assets
-190
-190
-721
-662
Impairment losses, other non-current assets
-6
-7
Operating profit (EBIT) before special items
Special items, net
4
-97
-55
-117
-101
Operating profit (EBIT)
Financial income
Financial costs
-97
-78
-280
-284
Profit before tax
Tax on profit
-24
-59
Profit for the period
Attributable to:
Equity holders of DFDS A/S
Non-controlling interests
Profit for the period
Earnings per share
Basic earnings per share (EPS) of DKK 20, DKK
Diluted earnings per share (EPS-D) of DKK 20, DKK
DFDS Group Income statement
2020
Management review
Ferry
Logistics
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Financials
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Interim Q4 2020 and Full-year Report / p 19
2020
2019
2020
2019
DKK m
Q4
Q4
Full year
Full year
Profit for the period
Other comprehensive income
Items that will not be reclassified subsequently to the Income statement:
Remeasurement of defined benefit pension obligations
-29
-59
Items that will not be reclassified subsequently to the Income statement
-29
-59
Items that are or may be reclassified subsequently to the Income statement:
Value adjustment of hedging instruments:
Value adjustment for the period
-73
-38
-103
Value adjustment transferred to operating costs
Value adjustment transferred to financial costs
Value adjustment transferred to non-current tangible assets
-7
-39
-38
-113
Tax on items that may be reclassified to the Income statement
-19
-15
Foreign exchange adjustments, subsidiaries
-37
Items that are or may be reclassified subsequently to the Income statement
-1
-24
-147
Total other comprehensive income after tax
-30
-206
Total comprehensive income
Attributable to:
Equity holders of DFDS A/S
Non-controlling interests
Total comprehensive income
DFDS Group – statement of Comprehensive income
2020
Management review
Ferry
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Interim Q4 2020 and Full-year Report / p 20
DFDS Group - Balance sheet
Assets
2020
2019
DKK m
Full year
Full year
Goodwill
Other non-current intangible assets
Software
Development projects in progress
Non-current intangible assets
Land and buildings
Terminals
Ships
Equipment, etc.
Assets under construction and prepayments
Right-of-use assets
Non-current tangible assets
Investments in associates, joint ventures and securities
Receivables
Prepaid costs
Deferred tax
Derivative financial instruments
Other non-current assets
Non-current assets
Inventories
Trade receivables
Receivables from associates and joint ventures
Other receivables
Prepaid costs
Derivative financial instruments
Cash
Current assets
Assets classified as held for sale
Total current assets
Assets
Equity and liabilities
2020
2019
DKK m
Full year
Full year
Share capital
Reserves
-274
-120
Retained earnings
Proposed dividends
Equity attributable to equity holders of DFDS A/S
Non-controlling interests
Equity
Interest-bearing liabilities
Lease liabilities
Deferred tax
Pension and jubilee liabilities
Other provisions
Derivative financial instruments
Non-current liabilities
Interest-bearing liabilities
Lease liabilities
Trade payables
Payables to associates and joint ventures
Other provisions
Corporation tax
Other payables
Derivative financial instruments
Prepayments
Current liabilities
Liabilities
Equity and liabilities
2020
Management review
Ferry
Logistics
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Financials
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Interim Q4 2020 and Full-year Report / p 21
Reserves
DKK m
Share
capital
Translation
reserve
Hedging
Reserve
Treasury
shares
Retained
earnings
Proposed
dividends
Equity
attributable
to equity
holders
of DFDS A/S
Non-
controlling
interests
Total
Equity at 1 January 2020
-357
-28
Comprehensive income for the period
Profit for the period
Other comprehensive income
Items that will not be reclassified subsequently to the Income statement:
Remeasurement of defined benefit pension obligations
-59
-59
-59
Items that will not subsequently be reclassified to the Income statement
-59
-59
-59
Items that are or may be reclassified subsequently to the Income statement:
Value adjustment of hedging instruments for the period
-103
-103
-103
Value adjustment transferred to operating costs
Value adjustment transferred to financial costs
Value adjustment transferred to non-current tangible assets
-38
-38
-38
Tax on items that will be reclassified to the Income statement
Foreign exchange adjustments, subsidiaries
-37
-37
-37
Items that are or may subsequently be reclassified to the Income statement
-37
-119
-147
-147
Total other comprehensive income after tax
-37
-119
-50
-206
-206
Total comprehensive income
-37
-119
Transactions with owners
Acquisition, non-controlling interests
-1
Cancellation of proposed dividend at year-end 2019*
-235
Vested share-based payments
Sale of treasury shares
Cash from sale of treasury shares related to exercise of share options
-2
Transactions with owners
-235
-1
Equity at 31 December 2020
-394
-25
* DFDS’ annual general meeting (AGM) was held on 4 June 2020. In view of the reduced operational and financial visibility, the Board of Directors’ proposal to not pay a dividend was approved at the general meeting.
DFDS Group - Statement of changes in equity 1 January - 31 December 2020
2020
Management review
Ferry
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Financials
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Interim Q4 2020 and Full-year Report / p 22
Reserves
DKK m
Share
capital
Translation
reserve
Hedging
Reserve
Treasury
shares
Retained
earnings
Proposed
dividends
Equity
attributable
to equity
holders
of DFDS A/S
Non-
controlling
interests
Total
Equity at 1 January 2019
-398
-29
Change in accounting policies*
-231
-231
-1
-232
Restated equity at 1 January 2019
-398
-29
Comprehensive income for the period
Profit for the period
Other comprehensive income
Items that will not subsequently be reclassified to the income statement:
Remeasurement of defined benefit pension obligations
Items that will not subsequently be reclassified to the Income statement
Items that are or may be reclassified subsequently to the Income statement:
Value adjustment of hedging instruments for the period
Value adjustment transferred to operating costs
Value adjustment transferred to financial costs
Value adjustment transferred to non-current tangible assets
-113
-113
-113
Tax on items that will be reclassified to the Income statement
-15
-15
-15
Foreign exchange adjustments, subsidiaries
Items that are or may subsequently be reclassified to the Income statement
-15
Total other comprehensive income after tax
Total comprehensive income
Transactions with owners
Dividend paid
-229
-229
-3
-232
Dividend on treasury shares
-6
Proposed dividend at year-end
-235
Vested share-based payments
Cash from sale of treasury shares related to exercise of share options
Other adjustments
-1
-1
-1
Transactions with owners
-198
-197
-3
-201
Equity at 31 December 2019
-357
-28
*Impact from implementation of IFRS 16.
DFDS Group - Statement of changes in equity 1 January - 31 December 2019
2020
Management review
Ferry
Logistics
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Financials
Contact
Interim Q4 2020 and Full-year Report / p 23
2020
2019
2020
2019
DKK m
Q4
Q4
Full year
Full year
Operating profit before depreciation (EBITDA) and special items
Cash flow effect from special items related to operating activities
-22
-32
-125
-78
Adjustments for non-cash operating items, etc.
Change in working capital
-224
Payment of pension liabilities and other provisions
-8
-9
-31
-52
Cash flow from operating activities, gross
Interest received, etc.
Interest paid, etc.
-87
-92
-276
-266
Taxes paid
-8
-46
Cash flow from operating activities, net
Investments in ships including dockings, rebuildings and ships under construction (incl. settlement of forward exchange contracts) related thereto
-169
-531
-1,422
-2,120
Sale of ships including prepayment received on ship held for sale
Investments in other non-current tangible assets
-28
-121
-195
-467
Sale of other non-current tangible assets
Investments in non-current intangible assets
-20
-22
-70
-66
Acquisition of enterprises, associates, joint ventures and activities
-127
-14
-131
Other investing cash flows
-2
-146
Cash flow to/from investing activities, net
-192
-777
-1,618
-2,651
Cash flow before financing activities, net
-59
Proceed from bank loans and loans secured by mortgage in ships
Repayment and instalments of bank loans and loans secured by mortgage in ships
-146
-248
-1,791
-799
Proceed from issuance of corporate bonds
Repayment of corporate bonds incl. settlement of cross currency swap
-500
Payment of lease liabilities
-141
-198
-602
-706
Proceeds from sale of treasury shares
Cash received from exercise of share options
Other financing cash flows
-60
-3
-60
-3
Dividends paid to equity holders of DFDS A/S
-229
Cash flow to/from financing activities, net
-458
-268
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Foreign exchange and value adjustments of cash and cash equivalents
-2
Cash and cash equivalents at end of period *
* At 31 December 2020 DKK 147m (31 December 2019: DKK 108m) of the cash was deposited on restricted bank accounts.
DFDS Group – Statement of cash flows
2020
Management review
Ferry
Logistics
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Financials
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Interim Q4 2020 and Full-year Report / p 24
Note 1 Accounting policies and significant estimates
Basis of reporting
This section provides an overview of our principal accounting policies and new and amended
IFRS standards and interpretations.
Accounting policies
This interim report has been prepared in accordance with IAS 34 ‘Interim Financial Reporting’
as adopted by the EU and additional Danish disclosure requirements for interim reports of
listed companies. The interim report has been prepared using the same accounting policies,
judgements and estimates as for the annual report for 2019 except as described below.
Implementation of new or changed accounting standards and interpretations
DFDS has adopted all new, amended, or revised accounting standards and interpretations
(IFRSs) endorsed by the EU effective for the accounting period beginning on 1 January 2020
none of which has had material impact on the Group’s Financial Statements.
Significant estimates and Covid-19
In the view of Management, the areas where accounting estimates and assessments are
significant remain the same as per DFDS’ latest annual report. However, considering Covid-
19 certain significant estimates have been updated during 2020 compared to year-end
2019, particularly related to passenger traffic that have been impacted by increased travel
restrictions, especially in Q4-2020, imposed across the network.
In the preparation of the Interim Report, Management undertakes several accounting
estimates and assessments, and makes assumptions which provide the basis for recognition
and measurement of the assets, liabilities, revenues and expenses of the Group and the
Parent Company. These estimates, assessments and assumptions are based on historical
experience and other factors which the Management considers reasonable under the
circumstances, but which by their nature are uncertain and unpredictable. The assumptions
may be incomplete or inaccurate, and unanticipated events or circumstances may occur, for
which reason the actual results may deviate from the applied estimates, assessments, and
assumptions.
General impact of the Covid-19 virus
A description of the general impact of the Covid-19 virus on our business and segments can
be found in the management review, pages 4-10.
Impairment considerations due to Covid-19
Impairment testing is undertaken once a year unless indications of impairment occur. The
consequences of Covid-19 are considered such an indication and consequently, DFDS has
revisited its impairment tests from year-end 2019, on a quarterly basis in 2020.
While the current Covid19 situation is an impairment indicator, it is reasonable to assume
that the situation from a long-term perspective is temporary, though DFDS passengers’
traffic, mainly Oslo-Frederikshavn-Copenhagen route, still suffers significantly from the
travel restriction applied during Q4-2020. DFDS’ main assets have a long lifetime and the
impairment tests at year-end 2019 showed significant headroom without any growth in the
forecasting period. However on basis of the Q4-2020 impairment test DFDS has recognised
an impairment loss for Oslo-Frederikshavn-Copenhagen route of DKK 100m end of Q4-
2020. The impairment loss is recognised in the income statement under special items.
Management concludes that the long-term assumptions applied at year-end 2019 remains
valid for all other CGUs’ than Oslo-Frederikshavn-Copenhagen route. During Q3 and Q4
freight activities have almost recovered to prior levels. However, in the long run
management expects passenger activity to resume as well, but in a more restrained pace.
Receivables
The practice for recognising expected credit losses etc. remains the same as at year-end
2019. Presently, the changes in payment pattern is insignificant compared to year-end
2019 albeit the Covid-19 situation is monitored closely.
Liquidity risks
There are no changes to the risk described in the Annual Report 2019 on pages 42-45 nor
are there any significant changes to the financial risks described in the notes on pages 97-
100. The current cash resource is DKK 4.9bn (year-end 2019 DKK 2.3bn) of which undrawn
committed credit facilities amounts to around DKK 3.6bn (year-end 2019 DKK 1.4bn).
2020
Management review
Ferry
Logistics
Reports
Financials
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Interim Q4 2020 and Full-year Report / p 25
Other areas
DFDS has taken part in various government compensation schemes following Covid-19.
Wage compensation is reducing the staff costs in the income statement.
Note 2 Segment Information
DKK m
Ferry
Division
Logistics
Division
Non-
allocated
Total
Full year 2020
External revenue
8,923
5,030
18
13,971
Intragroup revenue
755
39
474
1,268
Total revenue
9,678
5,069
491
15,238
Operating profit (EBITDA) before special items
2,332
445
-45
2,732
Operating profit (EBIT) before special items
815
159
-117
858
Operating profit after special items (EBIT)
717
147
-124
741
Invested capital, average
20,222
1,613
665
22,500
DKK m
Ferry
Division*
Logistics
Division*
Non-
allocated
Total
Full year 2019
External revenue
11,475
5,095
21
16,592
Intragroup revenue
721
22
519
1,262
Total revenue
12,197
5,116
540
17,853
Operating profit (EBITDA) before special items
3,254
421
-42
3,633
Operating profit (EBIT) before special items
1,704
170
-123
1,751
Operating profit after special items (EBIT)
1,651
163
-164
1,650
Invested capital, average
18,964
1,464
500
20,927
* The Norwegian sideport shipping activities have been transferred from the Logistics Division to the Ferry Division per
1 January 2020, 2019 comparative figures have been restated accordingly.
2020
Management review
Ferry
Logistics
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Financials
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Interim Q4 2020 and Full-year Report / p 26
Note 3 Revenue
Full year 2020
DKK m
Ferry
Division
Logistics
Division
Non-
allocated
Total
Geographical markets
North Sea
3,692
-
0
3,692
Baltic Sea
1,207
-
0
1,207
English Channel
1,972
-
0
1,972
Mediterranean
2,052
-
0
2,052
Continent
-
2,280
0
2,280
Nordic
-
1,507
0
1,507
UK/Ireland
-
1,243
0
1,243
Other
0
0
18
18
Total
8,923
5,030
18
13,971
Product and services
Seafreight and shipping logistics solutions
6,750
0
0
6,750
Transport solutions
24
4,981
0
5,005
Passenger seafare and on board sales
968
0
0
968
Terminal services
664
2
0
667
Charters
317
0
0
317
Agency and other revenue
199
47
17
264
Total
8,923
5,030
18
13,971
All material revenue is recognised when each separate obligation in the customer contract
is fulfilled following the “over-time principle”. Most transports carried out by the Ferry
Division are characterised by short delivery time (most sailings are less than 30 hours while
sailings to/from Turkey are up to 72 hours). Transports carried out by Logistics Division can
take delivery over a longer period, but the impact is insignificant.
On board sales is recognised according to the “a point in time” principle and amount to DKK
313m (2019: DKK 1,124m).
Revenue includes revenue recognised from contracts with customers in accordance with
IFRS 15 and other revenue (leasing activities). Revenue from leasing activities amounts to
DKK 348m (2019: DKK 382m).
Full year 2019
DKK m
Ferry
Division*
Logistics
Division*
Non-
allocated
Total
Geographical markets
North sea*
5,280
-
0
5,280
Baltic sea
1,406
-
0
1,406
English Channel
2,632
-
0
2,632
Mediterranean
2,158
-
0
2,158
Continent
-
2,349
0
2,349
Nordic*
-
1,473
0
1,473
UK/Ireland
-
1,273
0
1,273
Other
0
0
21
21
Total
11,475
5,095
21
16,592
Product and services
Seafreight and shipping logistics solutions
7,579
0
0
7,579
Transport solutions
23
5,072
0
5,094
Passenger seafare and on board sales
2,664
0
0
2,663
Terminal services
643
3
0
646
Charters
347
0
0
347
Agency and other revenue
221
21
21
262
Total
11,475
5,095
21
16,592
* The Norwegian sideport shipping activities have been transferred from the Logistics Division to the Ferry Division per
1 January 2020, 2019 comparative figures have been restated accordingly.
2020
Management review
Ferry
Logistics
Reports
Financials
Contact
Interim Q4 2020 and Full-year Report / p 27
Note 4 Special items
2020
2019
DKK m
Full year
Full year
Accounting gain on sale of Liverpool Seaways
110
0
Accounting gain on sale of Anglia Seaways
0
30
Impairment of a passenger ferry and a terminal in the business unit Passenger
-100
0
Impairment of a freight ferry made in connection with reclassification to asset held
for sale
-29
0
Accrual of the total estimated costs (estimated fair value) related to the DFDS
shares awarded to DFDS employees as a special one-off award in connection with
DFDS’ 150 years anniversary in December 2016. The costs accrue from December
2016 to February 2020
4
-19
Termination cost in connection with restructuring
-102
-22
Accounting loss and costs related to disposal of two associated companies
0
-8
Transaction and integration costs regarding the acquisition and integration of U.N.
Ro-Ro, including costs related to the closure of Toulon port etc.
0
-82
Special items, net
-117
-101
Note 5 Acquisition of enterprises and sale of activities
2021
On the 26 January 2021 DFDS has entered into an agreement to acquire HSF Logistics
Group.
2020
There has been no significant acquisitions nor disposals in 2020.
2019
On 9 December 2019 the acquisition of the Dutch company Huisman Group BV
headquartered in Wijchen was completed.
On 19 December 2019 the acquisition of the Finnish company Freeco Logistics
headquartered in Turku was completed.
For further details of these acquisitions, refer to the annual report for 2019.
Note 6 Fair value measurement of financial instruments
The table discloses fair value and carrying amount of financial instruments measured at fair
value in the balance sheet. Furthermore, categorisation of the valuation method according
to the fair value hierarchy is stated.
Transfers between levels of the fair value hierarchy are considered to have occurred at the
date of the event or change in circumstances that caused the transfer.
There were no transfers between the levels in the fair value hierarchy in 2020.
Techniques for calculating fair values
Derivatives
DFDS' usage of derivatives includes interest rate swaps, bunker swaps, forward exchange
contracts and currency swaps. The fair values on interest rate swaps have been calculated
by discounting the expected future interest payments. The discount rate for each interest
payment is estimated on the basis of a swap interest curve, which is calculated based on a
wide spread of market interest rates. The fair value on forward exchange contracts are
based on interest curve calculations in DFDS' Treasury system. Calculations are based on a
spread of market interest rates in the various currencies. Calculation on bunker swaps are
based on quoted forward curve from various financial institutions.
Full year 2020
Full year 2019
DKK m
Fair value
Carrying
amount
Fair value
Carrying
amount
Financial assets
Derivatives (Level 2)
226
226
317
317
Securities (Level 3)
10
10
10
10
Financial liabilities
Derivatives (Level 2)
201
201
88
88
2020
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Ferry
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Financials
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Interim Q4 2020 and Full-year Report / p 28
Note 7 Supplementary financial information on
the Parent company
As a result of DFDS A/S' issuance of corporate bonds on Oslo Stock Exchange there is a
requirement to provide certain supplementary financial information on the Parent Company.
The following financial information has been prepared using the same accounting policies as
for the Annual Report for 2019.
The Parent Company’s revenue decreased by DKK 2,372m, equivalent to 24%. Operating
profit before depreciation and special items (EBITDA) decreased from DKK 2,727m to DKK
1,758m, equivalent to a decrease of 36%. The negative development is entirely due to
travel restrictions and lockdowns related to Covid-19. Included in Financial items, net is
dividend received from subsidiaries of DKK 243m.
Profit before tax decreased from DKK 1,052m in 2019 to DKK 135m in 2020.
The Parent Company’s net interest-bearing debt increased from DKK 3,701m at 31
December 2019 to DKK 4,718m at 31 December 2020.
2020
2019
DKK m
Full year
Full year
Income statement
Revenue
7,385
9,757
Operating profit before depreciation (EBITDA) and special items
1,758
2,727
Operating profit (EBIT) before special items
104
1,011
Special items, net
-172
106
Operating profit (EBIT)
-68
1,117
Financial items, net
203
-65
Profit before tax
135
1,052
Profit for the period
140
1,049
Assets
Non-current intangible assets
400
368
Non-current tangible assets
5,458
4,872
Right-of-use assets
1,404
1,839
Investments in affiliated companies, associates and joint ventures
6,760
5,924
Non-current receivables from affiliated companies
261
715
Other non-current assets
110
243
Non-current assets
14,393
13,961
Current receivables from affiliated companies
699
1,199
Receivables from associates and joint ventures
27
46
Cash
735
656
Other current assets
1,381
1,234
Current assets
2,842
3,135
Assets
17,236
17,095
Equity and liabilities
Equity
9,382
9,339
Non-current liabilities
3,093
3,069
Current liabilities to affiliated companies
2,139
1,919
Other current liabilities
2,622
2,769
Current liabilities
4,762
4,687
Equity and liabilities
17,236
17,095
Equity ratio, %
54.4%
54.6%
Net interest-bearing debt
4,718
3,701
2020
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Ferry
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Interim Q4 2020 and Full-year Report / p 29
Definitions
Operating profit before depreciation (EBITDA)
Profit before depreciation and impairment on non-current assets
Operating profit (EBIT)
Profit after depreciation and impairment on non-current intangible and tangible assets
Operating margin
Operating profit (EBIT) before special items
Revenue
× 100
Net operating profit after taxes (NOPAT)
Operating profit (EBIT) minus payable tax for the period adjusted for the tax effect of net finance cost
Invested capital
Net working capital (non-interest bearing current assets minus non-interest bearing current liabilities) plus non-current intangible and tangible
assets minus pension and jubilee liabilities and other provisions
Net Interest-bearing debt
Interest-bearing liabilities (excluding provision for pensions) minus interest-bearing assets minus cash and securities
LTM
Last twelve months
Return on invested capital (ROIC)
Net operating profit after taxes (NOPAT)
Average invested capital
× 100
Free cash flow (FCFF)
Cash flow from operating activities excluding net interest received and paid minus cash flow from net investments
Return on equity
Profit for the period excluding non-controlling interests
Average equity excluding non-controlling interests
× 100
Equity ratio
Equity at end of period
Total assets
× 100
Earnings per share (EPS)
Profit for the period excluding non-controlling interests
Weighted average number of ordinary shares in circulation
× 100
P/E ratio
Share price at the end of the period
Earnings per share (EPS)
× 100
Dividend per share
Dividend for the year
Number of shares at the end of the period
× 100
Market value
Number of shares, ex. treasury shares, end of period times share price end of period
No. of ships
Owned and chartered ships, including slot charter and vessel sharing agreements
Unit
In the Logistics Business, a reported Unit is generally defined as a loaded trailer or container transported along a traffic route. One loaded
trailer or container counts as one unit irrespective of whether these are carrying a full loads or multiple part load consignments.
In addition, Logistics reports revenue from multiple value-add activities where volume units are not reported. These being Warehousing
activities, Managed Contracts, Workshops, Customs departments and Handling fees.
Roundings may in general cause variances in sums and percentages in this report.
2020
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Interim Q4 2020 and Full-year Report / p 30
DFDS A/S
Sundkrogsgade 11, DK-2100 Copenhagen Ø
CVR 14 19 47 11
www.dfds.com
10 February 2021
Company announcement no.: 6/2021
Contact
Torben Carlsen, CEO: +45 33 42 32 01
Karina Deacon, CFO, +45 33 42 33 42
Søren Brøndholt Nielsen, IR: +45 33 42 33 59
Nicole Seroff, Communications: +45 31 40 34 46
Disclaimer
The statements about the future in
this announcement contain risks and uncertainties
and actual developments may therefore diverge
significantly from the statements about the future.
About DFDS
DFDS provides ferry and transport services in Europe and
Turkey, generating annual revenues of EUR 2.3bn.
To over 10,000 freight customers, we deliver high
performance and superior reliability through ferry & port
terminal services, and transport & logistics solutions.
For more than five million passengers, we provide safe
overnight and short sea ferry services.
Our 8,000 employees are located on ferries and in offices
across 20 countries. DFDS was founded in 1866, is
headquartered in Copenhagen, and listed on NASDAQ
Copenhagen.