DSV’s profits skyrocket thanks to UTi acquisition in January

The Danish global transport and logistics provider reported gross profits of 7.8 billion Danish krone on revenues of 32.9 billion Danish krone for the first half of 2016, year-over-year increases of 40.4 percent and 28 percent, respectively.    Danish global transport and logistics provider DSV reported gross profits of 7.8 billion Danish krone (U.S. $1.2 billion) for the first half of 2016, a 40.4 percent increase from the corresponding period in 2015, thanks to its acquisition of third-party logistics provider UTi Worldwide in January, DSV said.
   Net revenues for the first half of 2016 surged 28 percent year-over-year to DKK 32.9 billion.
   In the second quarter alone, DSV reported gross profits of DKK 4.2 billion on net revenues of DKK 17.6 billion, year-over-year increases of 46 percent and 34.1 percent, respectively.
   DSV’s $1.35 billion acquisition of UTi closed Jan. 22, as from which date the UTi results were included in DSV’s consolidated financial statements.
   “DSV continues the positive development, and UTi’s operating deficit has been neutralized only five months after the acquisition,” DSV CEO Jens Bjørn Andersen said. “The integration of UTi is progressing faster than we had originally anticipated, and the merger of offices and IT systems is already more than halfway complete.”
   Since the integration of UTi is going well and is ahead of schedule in some areas, DSV said it therefore expects that 40 percent of the total synergies of DKK 1.5 billion will materialize in 2016, compared to the previous estimate of 30 percent.
   Overall, the acquisition primarily impacted DSV’s Air & Sea division, but has also contributed activities to DSV’s other two divisions, Road and Solution, the company said.
   The Air & Sea Division reported sea freight volumes for the first half of the year surged 49 percent from first half of 2016, while airfreight volumes skyrocketed 84 percent.
   The UTi acquisition also contributed activities to DSV’s Road Division, primarily in the U.S. and South Africa, in addition to the Solutions Division, which has become a global player in contract logistics, DSV said.