After banner year, Danzas sees 'modest' outlook
Danzas Group, the logistics arm of Germany’s Deutsche Post AG, boosted its net revenue by 86% last year through acquisitions and expansion, but expects only modest growth this year, partly because of the cooling U.S. transportation market.
Chief executive Peter Wagner said at a news conference today that the company expects to achieve “more than 2%” growth in revenue this year, and perhaps a higher percentage depending on the impact of the recent North American economic slowdown on European and Asian markets.
He said the group’s operating profit (before amortization) rose by about $102 million last year while its work force grew through acquisitions from 29,000 to more than 43,000 worldwide.
Danzas last year acquired Air Express International, Nedlloyd EDT and Scandinavian forwarder ASG.
Renato Chiavi, who heads Danzas’ Intercontinental Business Unit – which handles all air and sea operations – said Danzas AEI now ranks first worldwide in air cargo, with a 6.4% share of the international market. That includes 8.9% of the North American, 10.9% of the European and 14.9% of the South Pacific markets.
He said Danzas’ integration of AEI, which began in earnest last summer, is on track to be completed by year-end. He said 28 of the 37 Danzas AEI units have integrated their computer and software systems. He also said Danzas AEI has finalized negotiations to take over 10 of AEI’s 16 joint ventures and agent arrangements worldwide, and expects to resolve the other six joint-venture deals by the end of the year.
While Danzas’ parent company, Deutsche Post, this week reported an increase of nearly 50% in last year’s profits, Wagner said Danzas is feeling “no pressure, but certainly clear monitoring” of its business operations by Deutsche Post chairman Klaus Zumwinkel.
After last year’s buying spree, Danzas is likely to take two or three years to consolidate its units before making additional major acquisitions in the Intercontinental and Eurocargo operations, Wagner said. But he added that the company is likely to make some acquisitions sooner to bolster its Solutions logistics unit, which offers supply chain management in specific industry sectors, such as automotive and electronics.
