DSV reports road freight recovery after Schenker disruption

DSV has reported a recovery in road freight service levels towards the end of the third quarter after integration problems following its acquisition of Schenker reduced productivity and volumes in Europe. The Danish logistics group reported EBIT before special items of DKK 6.606 billion for the three months to September, up from DKK 5.434 billion a year earlier. Air & Sea and Contract Logistics supported the improvement, while the Road division remained under pressure despite operations returning towards normal by quarter-end.

The DKK 6.606 billion group result included DKK 300 million in gains on property disposals, so the figure cannot be attributed entirely to freight operations. Revenue reached DKK 80.702 billion, compared with DKK 71.983 billion in the corresponding quarter of 2025, while gross profit was DKK 20.253 billion. DSV attributed much of the earnings improvement to synergies generated by combining the businesses, although tariffs, energy costs and an uncertain demand outlook continued to affect trading. The year-on-year comparison also reflects the enlarged group after Schenker’s acquisition, rather than growth measured on an unchanged portfolio of contracts.

In Road, EBIT before special items fell 35.1% to DKK 526 million, including DKK 195 million of gains from property disposals. The division recorded negative volume growth and lower productivity after reliability problems emerged during European integration. DSV said operational performance had normalised by the end of September, although the financial performance remained weak. Collection and delivery commitments can recover before the cost of fulfilling them: additional manual planning, subcontracting or vehicle movements may still depress margins while depots and trunk routes are consolidated. The company did not attribute the problems to a named depot, software system or customer contract.

Integrating two road freight networks requires aligning branches, subcontractors, linehaul timetables and consignment records while traffic continues to move. A change in a trunk connection can alter when cargo is cross-docked, where loads are consolidated and which local vehicles receive shipments for final delivery. Missed connections or incomplete handover information may increase handling or require replacement capacity, but DSV has not published an incident-by-incident account of what caused its European service problems. The documented result is reduced reliability and productivity during integration, followed by a recovery in service levels towards the quarter’s end.

The Road business now faces the task of improving cost and commercial performance after its service recovery. Transport networks carry a substantial fixed operating burden in facilities, staff and scheduled connections, alongside variable expenses such as linehaul purchases and diesel. When freight volumes fall or the number of handlings per shipment rises, that burden is spread over fewer paying movements. Restoring a stable timetable is a necessary operational step, but stronger margins also depend on load factors, route planning, customer retention and the effectiveness of network consolidation. DSV has not provided a precise date by which all Road profitability measures will return to previous levels.

Elsewhere, Air & Sea delivered EBIT before special items of DKK 4.278 billion, an 18.9% increase, supported by integration synergies. Its conversion ratio reached 45.8%, compared with 38.6% a year earlier, although gross profit was broadly unchanged. Contract Logistics generated DKK 1.673 billion of EBIT before special items, up 50.3%. That division benefited from higher productivity, capacity utilisation and consolidation of less profitable sites. These results demonstrate different stages of integration across the combined business rather than uniform success in every transport mode.

The company continues to expect annual synergies of approximately DKK 9 billion from the Schenker transaction, partly offset by inflation and additional Contract Logistics operating costs. Some benefits associated with Road and group functions are now expected in 2027 instead of 2026. DSV said almost all countries had completed or started integration by the third quarter, with the remaining countries expected to begin during the final three months of the year. The overall integration cost estimate remains approximately DKK 11 billion, although the timing of recognition has shifted as certain work continues into next year.

DSV narrowed its 2026 forecast for EBIT before special items to DKK 24 billion–25 billion, compared with the previous DKK 23.5 billion–25.5 billion range. It expects further property disposal gains in the fourth quarter. Adjusted free cash flow reached DKK 6.439 billion during the third quarter, helped by asset-sale proceeds, while working capital remained elevated amid freight rates and fuel prices. These accounting and financing movements need to be distinguished from the Road division’s underlying transport productivity and the space available in contract warehouses; the earnings report does not establish a uniform change in service across every customer location.

The next operating evidence will be whether Road volumes and productivity recover alongside the service timetable already restored towards the end of September. Work remains to integrate countries that have not yet started, improve margins on established routes and achieve the Road and group-function synergies now expected in 2027. Air & Sea and Contract Logistics are contributing earnings growth, but those divisions’ performance cannot establish that the road network has completed its recovery. DSV’s fourth-quarter disclosure should show whether improved reliability is translating into stronger utilisation and commercial results.