Brexit uncertainty limits DFDS’ freight growth

Volumes in Q3 were ‘below expectations’ as UK activity slowed and Europe-Turkey trading was impacted by depreciation of Turkish Lira.

Increasing uncertainty related to Brexit has restricted freight revenue and volumes at European ferry group DFDS during the last quarter, the company said today.

Overall third-quarter (Q3) revenue increased 12%, year on year, to DKK 4.4bn, mainly driven by the expansion of the route network in the Mediterranean and higher revenue from passengers in the Q3 holiday high season, helping pre-tax earnings (EBITDA) before special items to increase 7% to DKK 1.045 bn.

But freight revenue “was subdued by a slowdown related to increased uncertainty on Brexit”, the company said, although the comparison figures were also more difficult because a large new logistics contract had inflated revenues in the same period last year.

Freight ferry volumes in Q3 were up 6%, “which was below expectations as activity linked to the UK slowed while trading between Europe and Turkey was impacted by a significant depreciation of TRY (Turkish Lira) in August”, DFDS said.

CEO Niels Smedegaard commented: “Our new Mediterranean freight routes are performing as expected when acquired. In northern Europe, however, businesses and consumers require clarity on Brexit for growth to continue.”

Source: Lloyd’s