DSV Annual Report 2022
30
DSV Annual Report 2022 Financial and non-financial performance
= III
Revenue
(DKKm)
28,000
24,000
20,000
16,000
12,000
8,000
4,000
0
2018
2019
2020
2021
2022
Gross profit
Gross profit
Conversion ratio →
delivers significant scale benefits, including improved utilisation of space
and equipment, warehouse automation and better staff planning. This is
clearly reflected in the division's higher profit margins in recent years.
Across both new and existing warehouses, we continue to focus on sus-
tainability, launching several initiatives to reduce the environmental im-
pact of our operations. Our new warehouses are certified in line with
leading standards, such as BREEAM, and we increase the utilisation of
rooftop areas for solar panels.
Our ongoing consolidation efforts also include the IT infrastructure. More
than 70% of all sites operate on the division's global Warehouse Manage-
ment System, enabling standardisation of services and workflows while
reducing the cost per transaction (order line).
In 2021, we launched DSV Fulfilment Factory. This solution enables us
to offer warehouse automation to all sizes of companies with multiple
distribution channels, both B2B and B2C. We continued rolling it out in
2022 and now have 8 of 16 planned sites in operation.
(DKKm)
%
10,000
30
25
8,000
20
6,000
15
4,000
10
Results
2,000
5
0
0
2018
2019
2020
2021
2022
EBIT before special items
EBIT
Operating margin →
%
14
12
10
8
6
4
2
(DKKm)
3,000
2,500
2,000
1,500
1,000
500
0
2018
2019
2020
2021
2022
Solutions revenue was DKK 24,409 million in 2022 (2021: DKK 18,734
million), an annual growth of 26.2%. Growth was strongest in the first
part of the year and was driven both by the inclusion of GIL and by
organic growth across all regions.
Gross profit was DKK 9,318 million in 2022 (2021: DKK 6,653 million)
- an annual increase of 35.3%. The division achieved a gross margin of
38.2%, compared to 35.5% last year. Higher activity, high warehouse
utilisation and more efficient workflows in the new campuses were the
main drivers behind this development.
EBIT before special items was DKK 2,701 million (2021: DKK 1,775
million). This increase of 47.4% was driven by organic growth across
all regions and the successful integration of GIL.
The conversion ratio was 29.0%, compared to 26.7% last year.
This improvement was driven by growth in gross profit, and it was
achieved despite general cost inflation affecting the cost base - especially
in the second half of the year.
Net working capital (NWC) was DKK 1,624 million at the of the year,
compared to DKK 1,061 million last year. The increase was mainly due to
higher activity levels and property projects in progress.
Return on invested capital came to 12.4%, compared to 11.3% last year.
The growth in earnings was partly offset by an increase in average invest-
ed capital compared to 2021, mainly due to increases in warehouse leas-
ing commitments.
Focus areas in 2023
The current economic slowdown is also impacting the contract logistics market.
We are closely monitoring developments and maintain high focus on continu-
ously adjusting capacity and managing our cost base to match demand levels.
Despite the temporary economic slowdown, we still expect the market to
be characterised by strong demand for modern, efficient and automated
warehouses in the right locations.
We will continue to develop multi-client, automated warehouses with a high
focus on sustainability and energy efficiency. We aim to strengthen our foot-
print across existing countries and focus particularly on growing our presence
in Americas and APAC. Bolt-on acquisitions may be relevant for us, especially
to gain specific industry competences or a foothold in a specific market.
We maintain our target of gaining market share our improved pharma
sector offering and strengthened e-commerce products are examples of
commercial initiatives we expect will support growth in 2023.
Several industries are focusing on creating more robust supply chains.
This may lead to relocating production for our customers, more regional
production and assembly, higher inventory levels and more stock points
or distribution centres closer to the end consumer. We will work closely
with our customers and pursue the opportunities this will provide.View entire presentation