By Isabelle Yr Carlsson and Jacob Gronholt-Pedersen
COPENHAGEN (Reuters) -Denmark’s DSV expects disruptions to Red Sea shipping to benefit earnings and the volume growth seen in the second quarter to continue in the coming months, it said on Wednesday, boosting its shares.
The world’s third-largest freight forwarder said it had increased volumes, especially of electronics and fashion retail, and continued to gain market share in its sea, air and road divisions during the second quarter.
“It’s the higher volumes that have created the momentum for us. And we expect good growth in our volumes going forward,” CEO Jens Lund told Reuters.
“It looks like the destocking, where customers brought down their inventory, has come to an end. Now I think there is a greater connection between what is consumed and what is produced,” he said.
Its shares rose 5.6% at opening and were trading 2.7% higher at 0919 GMT.
The financial impact of Houthi militant attacks on shipping in the Red Sea – which have pushed up freight rates, chiefly for shipping firms – was not yet reflected in the results, but is likely to be slightly positive in the rest of the year, DSV said.
DSV’s shares are down some 15% over the last year but have increased since May amid speculation of a possible takeover of Schenker, the logistics arm of Deutsche Bahn.
The German state rail operator last year launched a sale process for Schenker. Sources told Reuters last week that DSV and CVC are the two final bidders.
CEO Lund declined to comment on Schenker but said a strategy of growing through acquisitions remains central to DSV.
“We have bought many large companies, including some that were bigger than ourselves,” he said. “I can’t remember our company being more organized and stronger than it is now.”
Earnings before interest, tax and special items stood at 4.10 billion Danish crowns ($595 million) in the second quarter, compared with an average 3.99 billion forecast by analysts in a poll shared by the company.
DSV narrowed its full-year guidance to 15.5 billion to 17 billion crowns from a previous range of 15 billion to 17 billion.
($1 = 6.8862 Danish crowns)
(Reporting by Isabelle Yr Carlsson; Editing by Jacob Gronholt-Pedersen, Christopher Cushing and Jan Harvey)
