DSV A/S: DSV, 1155 - Interim Financial Report Q1 2025

Company Announcement No. 1155

Higher earnings in Q1 2025 driven by improved gross profit

• The DSV Group achieved higher earnings in Q1 2025 compared to the same period last year in volatile and uncertain markets. The earnings growth was driven by improved gross profit, especially in Air & Sea.
• Gross profit for the period improved by 6.2% and EBIT before special items was 4.8% higher compared to the same period last year.
• Strong adjusted free cash flow generation in Q1 2025, which improved to DKK 3,165 million.
• Today, DSV completes the announced acquisition of Schenker, becoming a world-leading player in transport and logistics.
• Full-year 2025 guidance for EBIT before special items is upgraded to DKK 19.5-21.5 billion from previously DKK 15.5-17.5 billion to reflect the preliminary expected contribution from Schenker in 2025. The underlying full-year guidance for DSV stand-alone is unchanged.
  

Jens H. Lund, Group CEO: "I am pleased with the positive financial performance and higher earnings growth during the first quarter of 2025 despite the current market uncertainties related to global trade. Our performance confirms the strength and flexibility of our business model and our ability to support our customers' global supply chains, and we have seen continued positive contribution from our commercial focus. The completion of the Schenker transaction and the upcoming integration mark a significant milestone in our growth strategy, which, combined with our continued strong commercial focus on organic growth and a flexible business model, will support our continued performance amid volatile and uncertain market conditions."

Selected key figures and ratios for the period 1 January - 31 March 2025

	Q1 2025	Q1 2024
Key figures (DKKm)
Revenue	41,680	38,340
Gross profit	10,991	10,265
Operating profit (EBIT) before special items	3,860	3,641
Profit for the period	2,812	2,393
Adjusted earnings for the period	2,874	2,463
Adjusted free cash flow	3,165	443
Ratios
Conversion ratio	35.1%	35.5%
Diluted adjusted earnings per share of DKK 1 for the last 12 months	51.9	55.3

Performance in Q1 2025
While market conditions in Q1 2025 were impacted by uncertainties related to the macroeconomic outlook and trade tariffs, DSV reported positive earnings growth compared to the same period last year, driven by higher gross profit in Air & Sea. Gross profit improved 6.2% to DKK 10,991 million, and EBIT before special items grew by 4.8% to DKK 3,860 million for the Group.

During the quarter, Air & Sea continued the positive commercial development growing the customer pipeline and activities with both large and mid-sized customers. Air freight volume for Q1 2025 was on par with the same period last year, as growth was negatively impacted by extraordinary large air freight volumes with a few customers in the same period last year. Adjusted for these low-yielding volumes, the air freight growth was on level with the addressable market. Sea freight volumes grew 3% compared to the same period last year, in line with the estimated market growth. The Air & Sea division continued to deliver strong results with 9.5% higher gross profit, driven by higher average gross profit yields in both segments, while EBIT before special items grew by 10.6% compared to same period last year.

Road reported lower EBIT before special items compared to last year, which was expected due to the overall weaker market conditions and cost inflation, while earnings improved sequentially compared to Q4 2024. Revenue decreased slightly compared to last year with relatively stable gross profit due to slight increase in freight rates and focus on productivity.

Solutions reported positive revenue growth of 4.9% and an increase in gross profit of 6.7% driven by an increase in order lines and focus on improved productivity. However, higher cost, primarily due to increased depreciations related to new warehouses, resulted in a 6.3% decrease in EBIT before special items in Q1 2025 compared to last year. Efforts to improve operating margins and return on invested capital will continue through strategic commercial initiatives aimed at increasing utilisation and optimising global warehousing capacity.

Outlook for 2025
Following completion of the Schenker acquisition, Schenker will be included in the consolidated results of DSV from 1 May 2025 (see Company Announcement 1154). The preliminary expected impact from the acquisition has been included in the full-year outlook for 2025, which is upgraded as follows:

• EBIT before special items is expected to be in the range of DKK 19.5-21.5 billion (previously DKK 15.5-17.5 billion). The upgrade is entirely related to the expected Schenker impact, as the underlying guidance for DSV stand-alone is unchanged.
• Limited impact on the statement of profit and loss expected from synergies related to the integration of Schenker in 2025.
• Preliminary amortisation of purchase price allocations in the level of DKK 500 million are included in the outlook for 2025.
• Special items related to restructuring and integration cost in the range of DKK 2.0-2.5 billion in 2025.
• The effective tax rate is expected at approximately 24% (unchanged).
  

The expected contribution from Schenker during the integration period, including synergies and integration costs, is based on preliminary estimates and assumptions. Alignment of Schenker's financials to DSV's definitions and accounting standards is still in progress. An update on the integration will be communicated in connection with the release of DSV's H1 interim financial report, which is postponed from 24 July 2025 to 31 July 2025.

The current geopolitical landscape, including the Red Sea situation, macroeconomic factors and the global trading environment, particularly potential demand risks arising from the announced trade tariffs, remain uncertain, and unforeseen changes may impact our financial results. We continue to monitor activity across our organisation, and we will adjust capacity and our cost base if needed.

Synergies and integration costs
Based on preliminary estimates, annual synergies are estimated in the level of DKK 9.0 billion at end of 2028, when the majority of the integration is expected to be complete. Total transaction and integration costs are expected in the level of DKK 11.0 billion. These costs will be charged to the statement of profit and loss under special items during the integration period. Expected synergies and integration costs are based on preliminary numbers.

Contacts
Investor Relations
Stig Frederiksen, tel. [phone], [e-mail]
Alexander Plenborg, tel. [phone], [e-mail]

Media
Jonatan Rying Larsen, tel. [phone], [e-mail]

Yours sincerely,

DSV A/S