Slide 1: Q3 2022 Results
Q3 2022 RESULTS DSV A/S Investor presentation 1 | DSV – Q3 2022 results
Slide 2: Forward-looking statements
Forward-looking statements This presentation contains forward-looking statements. Such statements are subject to risks and uncertainties, as various factors, many of which are beyond DSV A/S’ control, may cause actual developments and results to differ materially from the expectations contained in t
Slide 3: Content
Content 1 Highlights 2 Business segments 3 Financial review 4 Upgraded outlook for 2022 5 Appendix 3 | DSV – Q3 2022 results
Slide 4: Highlights Q3 2022
Highlights Q3 2022 • Continued strong performance across the organisation – despite weaker demand. • Strong cash flow and two new share buyback programmes of DKK 3 billion and DKK 4 billion. • 2022 EBIT guidance upgraded to DKK 24.5 - 25.5 billion (previously DKK 23 - 25 billion). Gross profit (DKKm
Slide 5: Air & Sea
Air & Sea (DKKm) Q3 2022 Q3 2021 Growth* 9M 2022 9M 2021 Growth* Management commentary Gross profit Air 4,793 3,329 34.6% 14,540 8,988 53.2% • EBIT growth driven by continued high gross profit yields and a strong Gross profit Sea 4,342 2,985 35.9% 12,807 7,256 66.3% focus on operational excellence.
Slide 6: Air freight Q3 2022
Air freight Q3 2022 DSV Tonnes (incl. GIL), '000 Gross profit/tonne, DKK 12,549 12,748 Management commentary 11,426 • Weaker demand was more than compensated 9,263 8,609 by strong yields. • Excluding GIL impact, DSV’s volumes declined approx. 10% in Q3 2022. This was better than the estimated market
Slide 7: Sea freight Q3 2022
Sea freight Q3 2022 DSV TEUs (incl. GIL), '000 Gross profit/TEU, DKK 7,200 6,549 6,379 Management commentary 5,904 • Also for sea freight, the weaker demand 4,905 5,200 was compensated by continued strong yields. 4,711 • No real peak-season in Q3 2022. Soft volumes on Asia-Europe and Asia-North Amer
Slide 8: Road
Road (DKKm) Q3 2022 Q3 2021 Growth* 9M 2022 9M 2021 Growth* Management commentary Revenue 10,406 8,783 16.9% 31,429 25,502 22.1% • Growth in GP, driven by higher activity levels and the addition of Gross profit 1,989 1,745 12.9% 6,001 5,170 15.3% GIL. • DSV Road has performed well EBIT 525 465 12.2%
Slide 9: Solutions
Solutions (DKKm) Q3 2022 Q3 2021 Growth* 9M 2022 9M 2021 Growth* Management commentary Revenue 5,841 4,739 18.1% 18,185 12,345 42.2% • The division continues to benefit from consolidation of IT systems Gross profit 2,325 1,717 29.5% 6,971 4,442 51.4% and the multi-client campus strategy. EBIT 613 48
Slide 10: P&L 9M 2022
P&L 9M 2022 (DKKm) Q3 2022 Q3 2021 Growth* 9M 2022 9M 2021 Growth* Management commentary Headlines Revenue 60,560 49,557 15.5% 184,434 121,004 45.9% • Solid GP growth in Q3 2022. Growth rates declined, as we met higher comparable Gross profit 13,538 9,823 30.7% 40,493 25,941 49.5% figures in 2021. E
Slide 11: Cash flow 9M 2022
Cash flow 9M 2022 (DKKm) 9M 2022 9M 2021 Variance EBITDA before special items 24,151 14,077 10,074 Management commentary Change in working capital 12 (5,416) 5,428 • Significant growth in adjusted free cash flow Tax, interest, change in provisions, etc. (4,147) (1,839) (2,308) driven by earnings gro
Slide 12: Share buyback and dividend
Share buyback and dividend Management commentary • Due to low liquidity in the stock market, the recent share buyback programme did not reach the maximum target. • We will now start two new programmes: • Up to DKK 3.0 billion starting 25 October 2022 and running until 14 November 2022 (outside of Sa
Slide 13: Upgraded outlook 2022
Upgraded outlook 2022 Main assumptions (DKKm) Updated outlook Previous outlook Actual 2021 EBIT before special items 24,500-25,500 23,000-25,000 16,223 Effective tax rate 24.0% 23.0% 24.5% Main assumptions • Based on our strong performance in the first nine months of 2022 and our expectations for Q4
Slide 14: Appendix
Appendix 14 | DSV – Q3 2022 results
Slide 15: DSV
DSV Global transport and logistics Global operations One company – DSV three divisions Nasdaq Copenhagen No majority shareholder – 100% free float +75,000 Air & Sea A3 (Stable) by Moody’s Employees A global network A- (Stable) by Standard & Poors Fortune Global 500 company +1,500 Road Overland trans
Slide 16: Our purpose, vision and mission
Our purpose, vision and mission Purpose Vision Mission Keeping supply chains Sustainable growth Operational excellence flowing in a world of change • We are part of the critical infrastructure. • We help our customers grow. • We design efficient infrastructure. • We conduct our business with integri
Slide 17: From local haulier to global player
11% 11% From local haulier to global player A global network created through organic growth and M&A 78% Breakdown of EBIT by division 2021 Air & Sea Road Solutions 3% Breakdown of EBIT by geography 2020 EMEA 38% Americas APAC 59% 2016 100% 2008 2006 2000 1997 1976 2,694 DKKm 19,478 DKKm 31,972 DKKm
Slide 18: Our market position
Our market position Third-party logistics providers by 2021 revenue in USD billion 1 Kuehne + Nagel (CH) 40.1 2 DSV (DK) 31.8* 3 DB Schenker (DE) 27.6 4 DHL GFF (DE) 25.5 5 C.H. Robinson (US) 22.0 6 Nippon Express (JP) 19.9 7 Expeditors (US) 16.5 8 9 10 UPS (US) SNCF Geodis (FR) 12.9 14.6 30 - 40% S
Slide 19: Working together to support your entire supply chain
Working together to support your entire supply chain +75,000 people in more than 80 countries at your service Third-party logistics services (3PL) 4PL services Air & Sea Road Solutions Lead Logistics • Access to all markets through our • Road freight services in EMEA and • Contract logistics worldwi
Slide 20: Creating value in the supply chain
Creating value in the supply chain From A to B and much more Freight forwarding services Logistics and distribution Shipment booking — Pick-up — Warehouse — Documentation Warehousing — Picking/packing — Cross-dock terminal — & customs clearance — Cargo consolidation — Purchase order Deconsolidation
Slide 21: Our value proposition
Our value proposition Why customers choose DSV Expertise Neutrality Proven products Systems Global network and a team of We have strong relationships with One of the largest global forwarders Strong suite of customer experienced freight leading carriers. with access to capacity and integrations and
Slide 22: 2026 financial targets
2026 financial targets Aiming for 45% conversation ratio for the Group 2021 actual 2026 targets Assumptions DSV Group • Annual GDP growth around 3% and transport market growth on the same level. Conversion ratio 43.1% >45.0% • We expect to gain market share in all divisions. • For the five-year peri
Slide 23: Gross profit yields
Gross profit yields We expect post-COVID yields to stabilise above historical levels 14,000 New inflation- External factors impacting yields 12,224 adjusted 12,000 Markets characterised by overcapacity, baseline • Significant inflation from 2019-2023. low growth and low inflation • Customers have mo
Slide 24: Historical transport market growth
Historical transport market growth CAGR in % 1980-2008 2000-2015 2015 2016 2017 2018 2019 2020 2021 Global real GDP 2.3% 4.6% 3.2% 3.1% 3.5% 3.7% 3.0% (3.4%) 5.5% Global trade 4.4% 4.3% 2.8% 2.4% 4.2% 4.2% 3.4% (9.5%) 10.8% multiplier ^ (x) 1.9x 0.9x 0.9x 0.8x 1.2x 1.1x 1.1x 2.8x 2.0x Container volu
Slide 25: DSV trade lane exposure
DSV trade lane exposure Geographical volume exposure Air freight Sea freight EMEA - APAC 14% EMEA - APAC 9% 14% 7% APAC - EMEA 14% APAC - EMEA 28% 14% 15% Americas - APAC 5% Americas - APAC 3% 9% 5% APAC - Americas 15% APAC - Americas 16% 14% 16% EMEA - Americas 14% EMEA - Americas 11% 10% 6% Americ
Slide 26: Sustainability
Sustainability EN IY SOS pe a a ae
Slide 27: A clear strategy for sustainability is a license to operate
A clear strategy for sustainability is a license to operate It is the right Tightening Stakeholder thing to do regulations demands § For our planet and for our Governments and NGOs are Increasing demand from future. setting robust targets to avert customers, employees, investors climate change and s
Slide 28: Our sustainability priorities
Our sustainability priorities Social Caring for our people. We are a safe and Environment CO2 emissions Diversity and inclusion inclusive place to work. We work hard to Reducing our impact. We recognise the Climate-related risks and Human capital development attract and keep talent by giving people
Slide 29: Science-based targets 2030
Science-based targets 2030 Our approved targets from a 2019 baseline year Scopes of emissions The SBTi framework uses the reporting standards established by the Greenhouse Gas Protocol, which divides greenhouse gas emissions into scopes: Scope 1 Direct emissions, typically from the burning Scope 3 •
Slide 30: We announced our science-based targets in 2020
We announced our science-based targets in 2020 DSV’s carbon footprint 2021 Science-based targets 2030 Our scope 3 emissions Tonne CO2 1% 30% Rail Scope 0.25 million 40% Reduction by 2030 Road 1&2 (buildings, company cars, Base year 2019 own truck fleet) Scope 3 12.5 million 30% (subcontracted transp
Slide 31: Green Logistics
Green Logistics A set of solutions that reduce the carbon footprint of your supply chain Compensate your carbon Track and trace your impact Rethink your logistics Fuel your green transition footprint CO2 reporting offers you the Green supply chain design Sustainable fuel offerings Carbon offsetting
Slide 32: Governance
Governance Strong alignment throughout the organisation Annual General The Board of Directors is responsible for setting the direction for the ESG agenda. They shape Meeting The Audit Committee within the the strategy and determine the targets in close Board of Directors is responsible alignment wit
Slide 33: Our approach to IT
Our approach to IT
Slide 34: Our platforms handle massive volumes
Our platforms handle massive volumes – enabling DSV’s growth Air & Sea Road Solutions Global TMS Platform Global TMS Platform Global WMSs +8 million +40 million +220 million jobs handled in 2021 shipments handled in 2021 order lines handled in 2021 EDI Public API Customer portal EDI Standard & EDI P
Slide 35: Our approach to IT
Our approach to IT Strong platforms with ongoing development and investments Consolidated IT landscape with one Millions of shipments are booked and myDSV, our online booking platform, transport/warehouse management system per tracked by our customers enables our customers to easily book division en
Slide 36: Digital and logistical capabilities
Broad and deep service offerings based on a solid IT platform DSV is uniquely positioned to combine logistical and digital capabilities Winning formula to compete in the future Utilising our global platform to provide complex supply chain solutions Governance & change capacity Digital capabilities c
Slide 37: Our IT landscape
Our IT landscape DSV Enterprise Reference Model Customer engagement • Unified entry for customer engagement • Electronic data exchange with customers via EDI and API GCO Air & Sea Road Solutions Group • Global CRM system • Global transport • One primary transport • Global warehouse • Global ERP syst
Slide 38: Technology radar
Technology radar Track Self-driving vehicles Space access Assess 5G network Edge For better Micro mobility Micro computing positioning satellites Wearables Test Smart watches & Power-to-X glasses, Exoskeletons Ocean ETA Blockchain Increasing ocean Augmented predictability with Digital forwarding rea
Slide 39: Financial details
Financial details
Slide 40: Strategy execution
Strategy execution 24% CAGR 2012 - 9M 2022 • Flexible and scalable business model • Performance driven organisation • Strong M&A track record Graph illustrates diluted adjusted earnings per share of DKK 1 78.8 50.9 26.5 22.1 22.1 18.4 12.9 13.4 9.5 10.1 10.5 2012 2013 2014 2015 2016 2017 2018 2019 2
Slide 41: Solid financial performance over the years
Solid financial performance over the years Revenue 40,000 Gross 36,000 (DKKm) 180,000 160,000 profit 32,000 (DKKm) 140,000 28,000 120,000 24,000 100,000 20,000 80,000 16,000 60,000 12,000 40,000 8,000 20,000 4,000 0 0 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 2013 2014 2015 2016 2017 20
Slide 42: Financial performance per division
Financial performance per division Selected KPIs DSV Group EBIT DKKm Conversion ratio (Rhs) Operating margin (Rhs) DSV Air & Sea EBIT DKKm Conversion ratio (Rhs) Operating margin (Rhs) 18,000 54% 14,000 63% 15,000 45% 12,000 54% 12,000 36% 10,000 45% 8,000 36% 9,000 27% 6,000 27% 6,000 18% 4,000 18%
Slide 43: Cash flow and ROIC
Cash flow and ROIC Operating cash flow (DKKm) Cash conversion ratio* (%) 14,000 140% 12,000 120% 110% 10,000 99% 100% 8,000 69% 80% 6,000 60% 4,000 40% 2,000 20% 0 0% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 9M-22 Average: 99% * Cash convers
Slide 44: Divisional and geographical exposure 9M 2022
Divisional and geographical exposure 9M 2022 Gross profit by division Gross profit by region 17% 23% Solutions APAC 68% 51% 15% Air & Sea EMEA Road 26% Americas EBIT before special items by division EBIT before special items by region 10% Solutions 29% 8% APAC 43% Road 82% EMEA Air & Sea 28% America
Slide 45: Capital structure and capital allocation
Capital structure and capital allocation (DKKm) 22,000 Management commentary 20,000 18,000 Financial gearing Net interest-bearing debt below 2.0x EBITDA before target special items. 16,000 1. Repayment of debt (if above target gearing ratio). 14,000 2. Value creating acquisitions or further developm
Slide 46: P&L details – DSV Group
P&L details DSV Group (DKKm) FY 2018 FY 2019 FY 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 FY 2021 Q1 2022 Q2 2022 Q3 2022 YTD 2022 Revenue 79,053 94,701 115,932 33,616 37,831 49,557 61,302 182,306 61,125 62,749 60,560 184,434 Direct costs 61,564 70,947 87,398 25,831 29,498 39,734 49,628 144,691 48,248 48
Slide 47: P&L details – Air & Sea
P&L details Air & Sea (DKKm) FY 2018 FY 2019 FY 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 FY 2021 Q1 2022 Q2 2022 Q3 2022 YTD 2022 Divisional revenue 36,972 51,151 73,689 22,924 25,948 36,861 46,168 131,901 45,887 47,282 45,339 138,508 Direct costs 27,779 38,634 56,780 18,136 20,806 30,547 38,643 108,132
Slide 48: P&L details – Road
P&L details Road (DKKm) FY 2018 FY 2019 FY 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 FY 2021 Q1 2022 Q2 2022 Q3 2022 YTD 2022 Divisional revenue 31,243 31,621 30,395 8,056 8,663 8,783 9,914 35,416 10,188 10,835 10,406 31,429 Direct costs 25,935 25,465 24,257 6,399 6,895 7,038 7,989 28,321 8,250 8,761 8,4
Slide 49: Investor Relations
Investor Relations Share information Financial calendar 2023 DSV A/S is listed on the Copenhagen stock exchange under 02 Feb. 2023 Annual Report, 2022 the symbol ‘DSV’. For further company information, please visit: www.dsv.com 16 Mar. 2023 Annual General Meeting 2023 27 Apr. 2023 Interim Financial