DSV increases FY projections on strong first half earnings, revenues

The Danish transportation and logistics provider’s strong results were driven by a “remarkable” 26 percent increase in earnings, according to CEO Jens Bjørn Andersen.    DSV A/S increased its second quarter and first half 2015 adjusted net earnings 13.6 percent to 560 million Danish krone (U.S. $81.7 million) and 15.6 percent to DKK 1.01 billion, respectively, compared to the same period in 2014.
   Second quarter 2015 net revenues at the Danish transportation and logistics provider grew 7.9 percent year-over-year to DKK 13.13 billion, while first half revenues were up 8.3 percent to DKK 25.73 billion, according to DSV’s most recent financial report.
   The company increased diluted earnings per share from DKK 2.83 per share to DKK 3.27 per share for the quarter and from DKK 4.92 per share to DKK 5.93 per share for the first half of the year.
   CEO Jens Bjørn Andersen said in a statement the results were driven primarily by growth in DSV’s air and ocean freight unit and that DSV would increase performance projections for the remainder of a the year as a result of the strong first half.
   “We maintained the positive growth trend in both number of shipments and earnings in all our business areas in the second quarter of 2015,” said Anderson. “Our Air & Sea Division reports a remarkable 26% earnings growth, and after a solid first six months of the year we now raise our full-year performance forecast for 2015.”
   Looking forward, DSV said it would raise full-year 2015 projections for gross profits, operating profits before special items and free cash flow. The company now expects gross profits in the range of DKK 10.9 billion to DKK 11.2 billion, up from DKK 10.5 billion to DKK 10.9 billion; operating profits (earnings before interest, taxes and amortization) in the range of DKK 2.85 billion to DKK 3.000 million, up from DKK 2.7 billion to DKK 2.9 billion; and free cash flow before any acquisition or divestment of enterprises of DKK 2.1 billion, up from DKK 2.0 billion, for the full fiscal year. DSV said all other expectations for full-year 2015 performance remain unchanged.
   Meanwhile, DSV also announced the launch of a new share repurchase program that will run until March 12, 2020 and cover a maximum of 17.5 million public shares. DSV noted that 2.8 million of these shares had already been exercised before the beginning of this buyback program.
   The company said the purpose of the share buyback program is “to meet the exercise of share options under the group’s incentive programs and adjust the capital structure.”
   “At the next Annual General Meeting of DSV a resolution will be proposed that shares which are not used for hedging of the incentive programs be cancelled,” meaning they would no longer be available for sale, the company added.
   The current share buyback will run from Aug. 13, 2015 to Oct. 20, 2015, including both the first and last day, during which time DSV will purchase public shares up to a maximum value of DKK 600 million. DSV said the program would be executed in accordance with the provisions of European Commission Regulation No. 2273/2003 of Dec. 22, 2003, “the so-called Safe Harbour method that protects the boards of directors and executive boards of listed companies from violating insider trading legislation in connection with share buybacks.”
   According to a statement from DSV, other terms and provisions of the program include:

• DSV is required to retain a financial adviser who is to make its own trading decisions independently of and without influence from DSV and execute the buyback within the announced limits. DSV has retained Nordea Bank Danmark A/S as its financial adviser and lead manager for the share buyback.
• Under the share buyback programme DSV may repurchase shares up to a maximum amount of DKK 600 million, and no more than 4,000,000 shares, corresponding to 2.29% of the current share capital of DSV A/S, may be purchased.
• No shares may be bought back at a price exceeding the higher of (i) the share price of the latest independent trade and (ii) the highest current independent bid at Nasdaq Copenhagen at the time of trading.
• The maximum number of DSV shares which may be purchased on each business day may not exceed 25% of the average daily trading volume of DSV shares on Nasdaq Copenhagen over the last 20 trading days prior to the date of purchase.
• The reporting obligations under Danish law and the rules of Nasdaq Copenhagen must be fulfilled within the applicable time limits.