Copenhagen, 9 March 2010
Announcement no. 8/2010
DFDS SET TO EXPAND IN 2010
DFDS achieved a reasonable result in a difficult 2009 and is set to expand
considerably in 2010 with the acquisition of Norfolkline
In 2009, DFDS achieved revenues of DKK 6.6 billion and an operating profit
(EBITDA) of DKK 786 million. An operating margin of 12% was thus maintained
despite the difficult market conditions. After depreciation etc. of DKK 612
million and finance cost of DKK 154 million, the pre-tax profit was DKK 20
million and DKK 89 million after tax.
”2009 was as foreseen a very challenging year and this is reflected in the
numbers of the annual report. On the other hand, the result is among best in
class of our sector, and that is an important benchmark for us. The freight
activities were impacted by a considerable downturn in volumes and rising price
competition, while the passenger activities improved earnings on the back of
more passengers, restructurings and a lower bunker cost,” says CEO Niels
Smedegaard in a comment to the report.
”With the acquisition of Norfolkline late last year, we took a decisive step
towards our vision of creating a strong North European sea-based transport
network, and DFDS will in the future be better positioned to effectively serve
our customers,” adds Niels Smedegaard.
Concerning the coming year, Niels Smedegaard says: ”DFDS have two major tasks
in 2010. Our markets are only just beginning to show signs of improving, and we
must continue to navigate through difficult waters. At the same time, we will
focus on implementing an effective integration of Norfolkline as fast as
possible.”
Expectations to 2010
Freight rates remain under pressure, while volumes have shown positive growth
in the first two months of the year across most of DFDS' markets. It is
therefore assumed, that the recession of 2009 will be replaced by some growth
and progress in 2010.
The performance of the freight activities, which was hardest hit by the
recession, is generally expected to improve in 2010, while some deterioration
is expected for the passenger activities, driven by higher bunker cost. All in
all, a pre-tax profit of around DKK 100 million is currently expected for 2010.
The expectation does not include transaction costs related to the acquisition
of Norfolkline.
Acquisition of Norfolkline
The expected acquisition of Norfolkline, announced 17 December 2009, remains
subject to approval from relevant competition authorities, the implementation
of a rights issue and a directed rights issue. These processes are progressing
according to plan. Completion of the transaction is currently expected to take
place towards the end of Q2 2010.
The planning of the integration of DFDS and Norfolkline was kicked off in
February with participation of employees from both companies. The scope of the
planning is all aspects of the integration in order to allow the actual
integration to start immediately after completion of the transaction.
Norfolkline's expected earnings and the financial consequences of the
integration - earnings as well as costs - have not been included in DFDS'
expectations for 2010, but will be included after completion of the
transaction.
