DACHSER builds on its growth driver
Revenue up by a solid 1.6 percent in 2019; European overland transport grows 2.9 percent; EUR 151 million invested in logistics facilities and IT systems.
Even as the global economy becomes increasingly weaker, DACHSER was able to continue growing in 2019. The logistics provider increased its consolidated net revenue by a solid 1.6 percent to EUR 5.66 billion. Driving this growth was again the Road Logistics business field, net revenue rose by 2.9 percent to EUR 4.60 billion. In contrast, the Air & Sea Logistics business field saw a decline of 4.1 percent, mainly attributable to weaker demand for air freight services for automotive customers.
The revenue growth at the Group level contrasts with declining shipment and tonnage figures. Although the number of shipments was down by around 3.7 percent from 83.7 to 80.6 million, tonnage fell only slightly compared to the previous year, slipping by 1.0 percent from 41.4 to 41.0 million metric tons. “When the economic wind turns, quality and reliability count more than ever,” says Bernhard Simon, CEO of DACHSER. “That’s why we’re all the more committed to ensuring our employees are well-qualified and motivated and why we’re continuously investing in our network, our processes, and our IT.”
Business development in detail
DACHSER’s Road Logistics business field—which comprises the transport and storage of industrial goods (European Logistics) and food (Food Logistics)—continued to provide stability while driving growth at the company. In 2019, Road Logistics increased its consolidated net revenue by 2.9 percent from EUR 4.47 to 4.60 billion. The Business Line European Logistics contributed 3.63 billion Euro (+2.4 percent) to the Road Logistics revenue.
Cross-border services remained strong and contract logistics saw positive development throughout Europe. Although the situation on the freight market relaxed in the course of 2019, the shortage of drivers and lack of qualified personnel in Germany and many other European countries continues to be our most pressing challenge.Bernard Simon, CEO DACHSER
DACHSER’s Food Logistics business line achieved the strongest growth in 2019, recording revenue growth of 5.1 percent from EUR 917 to 964 million. The number of shipments handled declined by 1.7 percent and tonnage saw a slight rise of 0.6 percent. “Food Logistics has been a reliable pillar of our business model for years,” Simon says. “The alliances with our partners in the European Food Network have proven to be extremely stable and fruitful.”
In the Air & Sea Logistics business field, revenue declined by 4.1 percent in 2019, from EUR 1.19 to 1.14 billion; the number of shipments was down by 5.6 percent. “In Air and Sea Logistics, we’re feeling the effects of the business climate, which is very volatile and greatly impacted by the disruptions to world trade,” Simon says. “In our air freight business, the effects of the weak demand for transport services from the German automotive industry are particularly evident.” In 2019, DACHSER took steps to future-proof this business field. These included adding the life sciences/pharmaceutical and fashion & sports sectors to its customer portfolio and expanding rail services along the New Silk Road. Air and sea transports, particularly for LCL, were connected more tightly with the European overland transport network. In addition, the rollout of DACHSER’s Othello transport management system, developed in-house, is now essentially complete. “By mid-2020, we will use our own transport management system to handle 99 percent of all shipments. The resultant improvements in efficiency and productivity allow us to add further value for our customers,” Simon says.
In the coronavirus crisis – An anchor of stability in difficult times
To further improve the quality of its services, last year the family-owned company invested EUR 151 million in the construction or expansion of transit terminals and warehouses and in IT systems and technical equipment. Investments of a similar amount are planned for the current year, too. However, due to the coronavirus outbreak, DACHSER, like many companies, will have to readjust its targets. Simon explains: “The final impact on our business is difficult to predict; all we can do is reassess the situation daily and respond accordingly, taking an agile and flexible approach. In view of the current restrictions on business activities, we can’t avoid a downturn in volume in our industrial goods business, especially in Spain and France. However, in terms of our service portfolio and customer structure, we deliberately adopt a very broad position so that we can adapt well to new scenarios. As a logistics provider, we are a key link in the basic supply chain for the food sector, and we expect this business to remain relatively stable.”
DACHSER further increased its equity ratio in 2019 to over 57 percent. With its current workforce of some 31,000, DACHSER has more employees than at any other point in its history. “We’re very proud of this because our employees are the heart and backbone of the service we provide. Securing jobs is our top priority in 2020,” Simon says. “We also want to remain a stable and reliable partner for customers and subcontractors. Together, we’ll overcome the crisis surrounding the coronavirus with fair prices and fair remuneration, and lay the foundations for future growth.”