DFDS: Navigating Uncertainty, Driving Growth

As we approach the end of 2024, DFDS, the Danish shipping and logistics company, invites investors to its full-year results presentation. Despite market headwinds and Brexit uncertainties, DFDS has demonstrated resilience and a commitment to growth. Let's delve into the key aspects of DFDS' strategy and performance.



Strategic Acquisitions: Expanding Horizons

DFDS' strategic acquisition strategy has been a driving force behind its revenue growth and market expansion. By acquiring key players in the ferry and logistics industries, DFDS has expanded its network and reach, enabling it to tap into new markets and opportunities. Some notable acquisitions include:

1. Norfolk Line (2010): This acquisition added ferry routes in The English Channel and the North Sea, as well as terminals in Dunkirk and Rotterdam, along with a major logistics operation. This acquisition grew DFDS' business by 70% and transformed the company into a new entity with a new structure.
2. UN Ro-Ro (2018): This acquisition, DFDS' largest financial investment, expanded its Mediterranean freight ferry operations and rail services between European ports and industrial regions in the EU.
3. Huisman (2019): The acquisition of this Dutch logistics company expanded DFDS' part-load services to and from the UK, among other things.
4. Freeco Logistics (2019): This acquisition expanded DFDS' presence in Finland and to and from the Continent and the Baltic states.

These acquisitions have allowed DFDS to expand geographically, reaching more than 20 markets, and to benefit from new growth markets while continuing to develop its strongholds across Europe. This expansion has driven organic growth and increased revenue for the company.

Win23 Strategy: Focusing on Key Industries

DFDS' Win23 strategy has driven growth in the automotive, forest & metal, and cold chain industries through several key initiatives. These initiatives have been implemented through a combination of organic growth, acquisitions, and digital developments. Some key initiatives include:

1. Growth in the automotive industry: DFDS has specialized and grown its ferry and logistics services within the automotive industry by setting up the structure, organization, and tools for this purpose. The company has also expanded its network through acquisitions and invested in new ferries to improve the capacity of its route network.
2. Growth in the forest & metal industries: DFDS has focused on growing solutions for the forest & metal industries as part of its Win23 strategy. The company has targeted acquisitions to expand its reach in these industries and invested in continuous improvement projects and the expansion of its network through acquisitions to grow scale advantages.
3. Growth in the cold chain industry: DFDS has specialized and grown its ferry and logistics services within the cold chain industry by setting up the structure, organization, and tools for this purpose. The company has expanded its network through acquisitions and invested in digital developments to improve its cold chain services.

These initiatives have been implemented to drive growth in the targeted industries and have been supported by acquisitions, organic growth, and digital developments. The company's financial ambition is to achieve an EBITDA of around DKK 5.5bn in 2023, compared to DKK 3.6bn for 2018, with an estimated uncertainty of around 10%.

Digital Transformation: Enhancing Efficiency and Customer Satisfaction

DFDS' digital transformation has significantly impacted its operational efficiency and customer satisfaction. The company has been focusing on digitising its core operations and launching new digital and online services to enhance its offerings and improve customer experience. Some key initiatives include:

1. DFDS Spot app: This online booking platform for ferry tickets on Channel services has made it easier for customers to book and manage their journeys, leading to increased customer satisfaction and convenience.
2. MyLogistics customer service website: This digital platform provides customers with real-time tracking, documentation, and other logistics services, enabling them to monitor their shipments more efficiently and reducing the need for manual follow-ups.
3. Priority discharge for freight customers: This digital service allows freight customers to prioritise their cargo for unloading, ensuring faster turnaround times and improved overall efficiency.
4. Instant quotes for logistics customers: By providing instant quotes, DFDS has made it easier for customers to compare services and make informed decisions, ultimately driving customer satisfaction and loyalty.
5. Digitisation of core operations: By digitising its core operations, DFDS has improved data transparency across its network, enabling better decision-making, automation, and workflow optimisation. This has led to increased operational efficiency and cost savings.

These digital initiatives have not only improved DFDS' operational efficiency but have also created more value for passengers and enhanced the overall customer experience. By making services easier and more cost-effective for customers, DFDS has been able to accelerate growth and drive customer satisfaction.

In conclusion, DFDS' strategic acquisitions, Win23 strategy, and digital transformation have all contributed to its resilience and growth in the face of market headwinds and Brexit uncertainties. As the company presents its full-year results, investors can expect to see a strong performance driven by these key initiatives. By staying focused on its strategic goals and continuing to innovate, DFDS is well-positioned to navigate uncertainty and drive growth in the years to come.