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28-05-2015

ECA Operator DFDS Achieves Highest-Ever First Quarter Operating Profit

The company has also turned around its money-losing English Channel route.

Danish ferry and transportation firm DFDS reports\u00a0for 2015 it has achieved its highest-ever first quarter operating profit and turned around its loss-making English Channel route.

Earnings before interest, taxes, depreciation and amortization more than doubled to DKK\u00a0228 million\u00a0($33.5 million) from DKK 91 million ($13.4 million) a year ago.

The company has also raised its outlook for 2015 as it seeks further growth.

"On the back of the Q1 result and expectations of continued growth above our initial expectations for 2015, we raise the outlook for EBITDA before special items to DKK 1.65-1.75bn from previously DKK 1.55-1.65bn," says Niels Smedegaard, chief executive officer for DFDS.

Smedegaard also told Reuters the firm was "placing bids on other companies on a regular basis," which follows the company last year buying\u00a0British logistic firms Stef Transport and Quayside.

DFDS has sped up the closure of loss-making routes - including the 139-year-old service between Esbjerg in Denmark and Harwich in England - and says it has moved vessels around its network more efficiently.

It also says it is committed to English Channel activities where it lost about DKK\u00a0100 million ($14.8 million) in 2013 and DKK 40 million\u00a0($5.9 million) last year, but Smedegaard said the unit has recovered and there are "no plans to give up the business... We are making money (there) now."\u00a0

Last year, prior to the collapse in oil prices, the company had warned that Emissions Control Area (ECA) rules effective January 1, 2015 meant it faced "very high additional costs".\u00a0

In March Smedegaard said ECA-based ferry operators were still at a competitive disadvantage to land transport, despite an almost 50 percent drop in the price of ECA compliant fuel.


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