DSV’s core profit increased 5.9 percent in the second quarter from a year ago as the Danish logistics and freight forwarding group cut costs to maintain margins in its global air, sea and trucking businesses.
Earnings before interest and tax rose to 687 million Danish crowns ($113.4 million) in the three months to June 30 from 649 million crowns ($107 million) in the year-earlier period.
Net profit jumped 10.3 percent to $71.3 million on a 2.6 percent increase in revenue to $1.9 billion.
The stronger-than-expected second quarter performance produced the best first half results in DSV’s history, with an operating profit before special items of $205 million.
Air and Sea revenue stalled at $782 million in the second quarter, but earnings grew 3 percent to $58.8 million. Container volume increased 1 percent, compared with market growth of 3 to 4 percent, but gross profit per 20-foot container was only marginally affected by record high freight rate increases.
Air freight tonnage fell 3 percent, compared to an estimated 4 to 5 percent market decline, and DSV increased its share in most markets, outweighing a decline in full charters.
DSV maintained its previous forecast of full-year earnings before interest, tax, depreciation and amortization in a range of $412 million to $445 million, although “uncertainty related to [the] global and European economy remains high.”
The company said it now expects ocean container volumes to grow 3 to 4 percent in 2012, compared with an earlier forecast of 4 to 5 percent, and a 3 to 4 percent decline in air freight traffic, instead of zero growth. Trucking volume likely will stagnate this year instead of growing 1 to 2 percent as previously forecast.
DSV said it is also launching a new $49.5 million share buyback, taking total buybacks in 2012 to between $248 million and $330 million.
Contact Bruce Barnard at email@example.com.