DSV Road Division Søren Schmidt, COO. DSV Capital Markets Day, 11 May 2010

Transcription

1 DSV Road Division Søren Schmidt, COO DSV Capital Markets Day, 11 May 2010

2 General Facts Top 3 in Europe 9,858 employees (end 2009) Operations in 34 countries Wide-ranging network of subcontractors More than 17,000 trucks on the road daily Turnover 2009: 18,390 million DKK EBITA 2009: 597 million DKK 2 DSV Capital Markets Day, 11 May 2010 DSV Road Division

3 DSV Road - Turnover Development Below chart illustrates the development in consolidated Turnover and CAGR for all countries in the Road Division from Turnover in million DKK ,871 12,686 13,375 16,141 24,294 22,793 19,806 18, * CAGR: Compound Annual Growth Rate Note: 2006 impact from Solutions activity reported under Road (Frans Maas), 2008 impact from sale of Tollpost Globe 3 DSV Capital Markets Day, 11 May 2010 DSV Road Division

4 DSV Road Gross Profit Development Below chart illustrates the development in consolidated Gross Profit and the Gross Margin for all countries in the Road Division from Q Gross Profit in million DKK Gross Profit Gross Margin 5,167 4,808 45% 40% ,849 2,734 2,848 3,273 3,993 3,914 35% 30% 25% % 21.6% 21.3% 20.3% 20.4% 21.1% 20.2% 21.3% 20.1% 20% 15% Q % Note: 2006 impact from Solutions activity reported under Road (Frans Maas), 2008 impact from sale of Tollpost Globe 4 DSV Capital Markets Day, 11 May 2010 DSV Road Division

5 DSV Road EBITA Development Below chart illustrates the development in consolidated EBITA, EBITA margin and Gross Profit conversion ratio for all countries in the Road Division from Q EBITA in million DKK % EBITA EBITA margin Gross Profit conversion ratio % 19.7% 20.5% 20.8% 21.9% 17.1% % 15.7% 52% 42% 32% 22% % 4.1% 4.2% 4.2% 3.6% 4.4% 4.4% 3.2% 3.1% Q % 2% Note: 2006 impact from Solutions activity reported under Road (Frans Maas), 2008 impact from sale of Tollpost Globe 5 DSV Capital Markets Day, 11 May 2010 DSV Road Division

6 DSV Road ROIC Development Below chart illustrates the development in ROIC and Invested Capital for all countries in the Road Division from Invested capital in million DKK 7,000 6,000 5,000 4,000 3,000 2,000 1,000 - Invested Capital ROIC including goodwill and customer relationships 6,199 5,673 4,102 4,552 3,902 3,873 3,626 3, % 17.3% 16.9% 15.6% 15.5% 13.3% 16.1% 11.8% % 25.0% 20.0% 15.0% 10.0% 5.0% 6 DSV Capital Markets Day, 11 May 2010 DSV Road Division

7 Comparison by Country in 2005, 2007 and Pre Frans Maas 2007 Pre ABX 2009 Now Turnover DE 9% GB 9% Other 17% 65% Other 26% FR 5% GB 8% DE 9% 52% Other 31% FR 6% GB 8% DE 11% 44% Gross Profit Other 18% DE 8% GB 10% 65% Other 28% FR 5% 51% Other 28% IT 6% 43% DE 7% GB 10% FR 7% GB 8% DE 9% EBITA BE 5% GB 7% Other 13% 74% GB 12% Other 5% BE 5% 78% Other 0% GB 11% PL 7% 82% 7 DSV Capital Markets Day, 11 May 2010 DSV Road Division

8 DSV Road - Position in the market In 2008 DSV A/S - Road ranked third among the Top 10 European Land Transport Leaders (Road and Rail Forwarding) Turnover in million Euro DSV Source: Transport Intelligence 8 DSV Capital Markets Day, 11 May 2010 DSV Road Division

9 Production / outsourcing Trucks DSV has more than 17,000 trucks on the road every day App. 3-4% of the trucks are operated by DSV the rest are operated by external hauliers Trailers DSV operates app. 6,200 trailers in a trailer-pool The trailers are leased on 4 year operational leasing contracts Advantages: Procurement strong buying power provides flexibility and enables better utilization of the equipment Terminals / Cross-docks DSV has app. 100 terminals which form the basis of our European network The terminals are owned by DSV or leased 9 DSV Capital Markets Day, 11 May 2010 DSV Road Division

10 Agreements with hauliers and customers Agreements with external hauliers The typical agreements with external hauliers are framework agreements The agreements are flexible and can be terminated on short notice Agreements with customers Mix of agreements and spot rates. The mix differs regionally. Agreements are typically one-year framework In reality prices can be changed on relatively short notice Price mechanism The Road Division operates within a competitive market and changes in prices can be driven by both customers and subcontractors driven by volume/capacity Hauliers capacity is normally adjusted relatively fast when demand /volumes is going up - and relatively slow when volumes are weak Overall it is estimated that DSV within one quarter will be able to pass on price increases to the customers 10 DSV Capital Markets Day, 11 May 2010 DSV Road Division

11 Update on market development Volume The total market volume dropped app % in 2009 versus DSV was able to gain market share but still saw a drop in consignments of app. 8% in 2009 Change in mix more but smaller consignments A relatively slow start on 2010, partly due to weather conditions but with a strong March DSV was able to grow 7% compared to Q We estimate that the total market grew app. 2-4% in Q1 Price Hauliers prices were low in 2009 At the end of Q we have seen pressure on capacity in some areas and prices have started to go up on certain traffics lanes DSV is used to operate in this market - and high volumes and high prices have historically been and advantage for DSV 11 DSV Capital Markets Day, 11 May 2010 DSV Road Division

12 DSV Road services All International transport Domestic distribution Full & part load and groupage Customs clearance Terminal and storage facilities Individual / local services Automotive Temperature controlled Bulk transport Hazardous cargo Value adding services Internet booking facilities Track & Trace 12 DSV Capital Markets Day, 11 May 2010 DSV Road Division

13 Customers DSV s main group of customers are small and midsized companies within a number of different industries We will continue to focus on these segments together with our local sales teams On top of our current small and midsized customer portfolio the Division and DSV s central sales organisation will increase focus on multinational accounts Focus on tailor made solutions towards our customers with e.g. KPI reporting 13 DSV Capital Markets Day, 11 May 2010 DSV Road Division

14 DSV Road - focus countries France The result in Q is negatively influenced by the fact that the ABX integration has not been finalized. In April 2010 an agreement with the unions has been reached, and based on this it will be possible to finalize the integration during Q It is expected that Road in France will be profitable in the latter part of 2010 Germany Road in Germany is on break even for the third consecutive quarter this is a very satisfactory development which is expected to continue Focus remains on developing the business and increasing the margins in Germany, through focus on sales and cost reductions Spain The last restructuring initiatives have been carried out in the beginning of 2010 The negative result has been reduced significantly It is expected that Road in Spain will be profitable in the latter part of DSV Capital Markets Day, 11 May 2010 DSV Road Division

15 DSV Road Projects Throughout the Road Division a number of projects have been initiated DSV E-services online web based booking STAR Shipment Tracking and Reporting Track and trace Big Bear automatic weight measurement Capacity management better utilization of the equipment To be initiated New Wawe increase efficiency in European network with focus on strategic hubs DSV FTL increase market share on Full Truck Loads Growth, improved margins and better service to the customers 15 DSV Capital Markets Day, 11 May 2010 DSV Road Division

16 Focus Areas / Goals We will: Continue to focus on a high Gross Margin and EBITA margin Continue to strengthen our market position via focus on sales both locally in the countries and centrally in DSV s Global Sales organisation Continue the positive development in Germany, France and Spain Be open to bolt-on acquisitions in Europe asset light companies Optimise our internal work processes and improve quality and efficiency by streamlining IT systems 16 DSV Capital Markets Day, 11 May 2010 DSV Road Division

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