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Robert.Jervis_43227 Feb 11

DSV sees leap in performance

59% growth in revenue and 71% growth in operating profits
Admittedly the conditions in most logistics markets are excellent if you are an asset owner or service provider, yet DSV performance over the past year has been predictably impressive.

For the fourth quarter and full year results, the top-line numbers are a 59% growth in revenue and 71% growth in operating profits for the whole company.

In the air and sea business, revenue for the year was up 81.6% to Danish Kroner 131.9bn (US$20.26bn) with the fourth quarter seeing a leap of 126% to Danish Kroner 46.168bn ($US7bn). Profits followed a similar trajectory, with EBIT (Earnings Before Interest & Tax) up 83.5%. Looking at the gross-profit numbers it was the sea freight forwarding business that really performed, however it should be remembered that the numbers are boosted by acquisition, both of the now fully digested Panalpina but also of GIL, with the latter expected to increase profits by Kroner 3bn from the back-end of this year. Also, the picture is not one of constantly increasing performance with peak profitability being in the first and second quarters of 2021, followed by a marked fall towards the end of the year. Still, DSV admits that it is the exceptional market conditions that have driven these results and that they feel that “assuming that demand holds up, the current market conditions are likely to last well into 2022”.

Unsurprisingly the ‘Solutions’ contract logistics business did not see such violent profit growth, nevertheless, for the full year revenue was up 28.4% and EBIT was up 51.3%. Demand seems strong, with high utilisation rates and operating margins hitting low double digits towards the end of the year. Similarly, the road freight business did more than respectably, with revenue up 16.2% and EBIT up 32.6%. DSV commented that the “market is characterised by high activity level, tight capacity and increasing rates” and that the “EU mobility package will lead to further rate increases in 2022.”

It is hard to know what is more responsible for these impressive results, DSV’s successful acquisition management or market conditions. Either way, DSV is clearly the most successful of the major logistics service providers. The company is suggesting that “congestion, tight capacity and high rate levels will continue in the first half of 2022. A gradual improvement could start during the second half of the year”. It will be interesting to see the impact on DSV’s results in a more normal market but bearing in mind it sees global growth continuing at 4%, any fall may not be particularly significant.

Segment data in detail

Air & Sea

Air & Sea saw an annual growth of 81.6%, with revenue rising from DKK73.7bn in 2020 to DKK131.9bn in 2021. This revenue growth was predominantly due to freight rates that reached record-highs, added with volume growth – particularly in the air freight segment. All regions contributed to the growth, with the GIL acquisition in August 2021 majorly driving the revenue growth.

Gross profit saw an annual growth of 42.3%, with monetary values rising from DKK16.91m (2020) to DKK23.77m in 2021. This growth has been driven by an increase in activity in 2021, certainly compared to 2020 whereby activity was lower, added to higher gross profit yields per unit. Tighter capacity, high freight rates and congestion across all logistics markets drove up gross profits per tonne for air freight and per TEU for sea freight.

The gross margin for Air & Sea was 18.0%, a slight drop from the 22.9% margin seen in 2020. The pass-through effect of freight rates meant that there were higher freight rates and therefore a lower gross margin.

EBIT before special items was DKK7.03m in 2020 but rose by 83.5% to DKK12.77m in 2021. An altered cost management strategy led to an increase in this EBIT, however the major input was the full year integration with Panalpina and the important relationship this has played, adding to the positive impact the GIL acquisition had on this segment. Regional performance was strong regarding EBIT growth in 2021, with Latin America having the highest growth rate across the segment.


Road revenue was DKK35.42m in 2021, up 16.2% from the 2020 figure of DKK30.4m. The scale of work and the increasing strength of the network helped DSV achieve efficient transport solutions for its customers, this is despite disruption across road networks. Continued M&As have helped the organic growth in activity, as well as a gradual increase in haulier rates and oil prices.

Gross profit increased 15.1% from a 2020 figure of DKK6.14m to DKK7.1m in 2021. This led to a gross margin of 20.0%, the same level as 2020; strong contributions across all regions added to the growth in revenue and profit.

EBIT before special items in 2021 was DKK1.86m, a 32.6% increase on the DKK1.4m figure in 2020 – this has been driven by the increase in gross profits. The Road Way Forward programme, bringing a digital element to DSV Road in Europe, has helped run these increased profits and revenues. The GIL acquisition, which added new road activities to the Middle East and Europe, as well as the acquisition of Globeflight in South Africa, were major drivers of growth of DSV’s road division.


DSV Solutions revenue was DKK18.73m in 2021, an annual growth of 28.4% from the 2020 number of DKK14.61m. This growth has been driven again by the influence of the acquisition of GIL, in turn creating its own organic growth and increasing the extent of the reaches of the segment’s activities. Another major driver of this growth in revenue is the growth of the e-commerce market in 2021. Consumer spending patterns have been changed by the pandemic, causing DSV to handle higher volumes of goods, as well as an increase in seasonality having the ability to have a strong influence on the markets.

Gross profit in 2021 was DKK6.65m, rising from DKK5.37m seen in 2020, an increase of 23.9%, driven by the increase in activity mentioned to do with e-commerce and consumer purchasing. An additional factor has been that of new and increased warehouse space, helping to optimise productivity, integrating new technologies into the warehousing processes to also increase efficiency.

Gross margin was 35.5% in comparison to a 2020 figure of 36.8%. This figure is in line with the internal expectations within DSV, who note that 2020 figures were majorly influenced by the cost savings the company had to do in regards to Covid-19. EBIT before special items was DKK1.78m, an annual increase of 51.3% from the 2020 number DKK1.16m. Robust performance across all regions leading to good organic performance, coupled with strong EBIT contributions from GIL, have led to this increase in EBIT before special items


Source: Transport Intelligence