JOC Staff | Nov 16, 2012 12:02PM EST
DFDS, Europe’s leading short-sea shipping company, reported operating profit in its traditionally busy third quarter declined 10 percent from a year ago as modest growth on Baltic Sea routes was more than offset by a steeper slide in North Sea volumes.
The Danish carrier earned 503 million kroner ($85 million) before interest, tax, depreciation and amortization in the three months to end-September compared with 561 million kroner ($95 million) in the 2011 period.
Revenue retreated 1.9 percent to $538 million and pre-tax profit plunged 18 percent to $46.3 million.
“The wheels of Europe’s economies, and thereby the transport sector, turned somewhat more slowly in Q3,” said Niels Smedegaard, CEO of the Copenhagen-based shipping and logistics group.
“The weakening of demand is causing overcapacity on several markets and pressure on earnings.”
DFDS’s North Sea traffic declined 7.7 percent from the third quarter of 2011, reflecting a weaker market, increased competition and the loss of a logistics contract with a car manufacturer that cut volume on routes out of Germany.
Baltic freight volumes increased by 4.4 percent, and freight rates were slightly higher than a year ago, but traffic slowed toward the end of the quarter, partly due to more favourable conditions for Russian truckers using Poland for transit to Western Europe.
DFDS said it expects to book a full-year operating profit of between $195 million and $203 million.