Denmark's DSV, the world's third-largest freight forwarder, said that it expects its 2023 profit to be impacted by lower volumes in the first half.
DSV benefited from sky-rocketing freight rates in the wake of the pandemic, but falling global consumer demand, soaring inflation and high inventories have since prompted rates to drop.
'Gradual Normalisation'
"Towards the end of the year, our performance was impacted by the general macroeconomic slowdown and a gradual normalisation of the freight markets," CEO Jens Bjorn Andersen said in a statement.
"We expect this trend will continue into 2023, and this is reflected in our financial guidance," he added.
DSV expects earnings before interest and tax (EBIT) before special items this year of DKK 16 billion (€2.15 billion) to DKK 18 billion (€2.55 billion)
This compares with DKK 16.9 billion (€2.27 billion) expected by analysts and DKK 25.2 billion (€3.39 billion) achieved last year.
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DSV Network
DSV operates around 23,000 trucks, employs some 75,000 people and has over 500 warehouses and logistics facilities globally, handling everything from shipment of individual pallets to entire supply chains for multinational companies.
Transport volumes, which normally grow in line with the economy, lagged global economic growth at the end of last year, as customers brought down inventory and consumer behaviour returned to normal levels, DSV said.
The company expects the negative development in freight volumes to continue in the first part of 2023, followed by a recovery in the second half.
It expects volumes in its air and sea division to decline by 2% to 5% this year, while road and logistics solutions are seen flat or declining slightly.
Fourth-quarter EBIT before special items stood at DKK 4.75 billion (€640 million), compared with the DKK 4.90 billion (€660 million) forecast by analysts in a poll gathered by the company.
News by Reuters, edited by ESM – your source for the latest supply chain news. Click subscribe to sign up to ESM: European Supermarket Magazine.
