Norbert Dentressangle may not be growing at the dramatic rate seen in 2012 but in 2013 it still saw some growth in both sales and profits despite tough market conditions.
Revenue increased by 3.9% year-on-year to €4,032m whilst Earnings Before Interest, Tax and Amortisation (EBITDA) was up 2.7% at €251.5m. This represented a small fall in profit margins from 3.7% in 2012 to 3.5% in 2013. The final result was complicated by depreciation of goodwill, leading to a net income of €70m up 1% year-on-year (after a restatement of earnings).
Looking at the constituent parts of the business; the core road transport operation saw a fall of 0.6% in like-for-like terms, with growth coming from dedicated fleet management services and pallet networks. Profits however, fell by more than 10% to €53m with the full-load business suffering worst, with France “suffering worst.”
The contract logistics segment grew more rapidly, with revenues up by 7% on a like-for-like basis compared to 2012. Operating profit increased from €77.9m in 2012 to €87.4m in 2013, a rise of 12.20%. Accordingly Margin edged up to 4.5%. The drivers of increased sales and profits were areas such as e-commerce, where Norbert Dentressangle provides logistics for retailers such as ASOS.
In both the transport and contract logistics businesses the fourth quarter saw an increase in the rate of growth with contract logistics seeing like-for-like business grow by 11%.
The small freight forwarding business continues to grow, driven by acquisitions such as the Daher Group. Revenue here increased by 1.3% to €145m and EBITDA was up by a third to €1.3m.
Clearly Norbert Dentressangle is consolidating its position as a leading European logistics service provider, expanding both by acquisition in markets such as Italy and Russia as well as through its organic strength in areas such as retailing. The implication of the company’s strategy is that further growth by acquisition will be in the area of freight forwarding and possibly outside Europe, simply because its road freight and contract logistics business segments are large enough to deliver the economies of scale required. The only constraint on such purchases may be the company’s net debt which is still substantial at €456m.
GLOBAL SUPPLY CHAIN INTELLIGENCE (GSCi)