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DSV profit misses forecast on weak freight rates
While standing by its previous forecast for full-year earnings before interest, tax and amortisation (EBITA) of 2.55-2.75 billion Danish crowns, the group held back from launching a new share buy back programme in order to meet its target for debt as a proportion of core earnings.
DSV said in February it was aiming for net interest bearing debt to be no more than 2 times earnings in 2013, against a previous target for to be between 2.0 and 2.5 times EBITDA.
At the end of the third quarter, the group’s net interest bearing debt stood at 2.1 times EBITDA.
Operating profit (EBIT) fell to 649 million Danish crowns ($119.94 million) in the quarter from 688 million a year earlier, and against an average forecast for 675 million in a Reuters poll of analysts.
The Danish company, which has about 22,000 employees across the world and supplies air, sea and land transport services, saw a faltering global economy hit freight volumes during in the quarter.
“The markets of DSV are still characterised by low growth and fierce competition,” said chief executive Jens Andersen in a statement.
For the full year, the company said it still expects the market for sea freight to grow two to three percent.
In the third quarter, group revenue rose a modest 1.4 percent in the quarter to 11.47 billion crowns, slightly lagging an average 11.52 billion forecast in the poll. (Reuters)
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