Photo: Scan Global Logistics
Top 25 airfreight forwarder Scan Global Logistics (SGL) is expecting a ”highly volatile” end to the year, driven by global trade unpredictability, and will look to cut costs in response.
The company this week reported its second-quarter results, with acquisitions playing a role in its 16.9% increase in revenues to €622m, while earnings before interest and tax (ebit) improved by 16% to €29m, but its overall result for the period was a loss of €30m against a loss of €14m last year.
The company said revenue improvements were driven by organic activity in Asia and Europe, the Middle East and Africa, as well as recent acquisitions.
The improvement in ebit was down to lower special item costs and gains driven by front-loading of volumes ahead of the implementation of US tariffs.
Overall profit performance was hit by a 26% increase in staff numbers as a result of acquisitions, and a €38m increase in financial items caused by exchange rate changes.
SGL added that margins came under pressure from a competitive market environment, industry consolidation and fluctuating demand due to the US tariff situation and geopolitical turmoil.
Looking at its airfreight performance, second-quarter volumes were up 15% to 51,936 tonnes. The development was driven by the acquisition of Foppiani (Italy) in June 2024 and some organic growth.
Outlook
Looking ahead, the company expects a volatile end to the year. SGL said that fluctuating freight rates have triggered rapid shifts between transport modes, especially driven by uncertainty regarding US tariffs.
Meanwhile, front-loading in the second quarter is expected to dampen demand in the third and fourth quarter, adding further uncertainty.
There is also ongoing unrest in the Red Sea and persistent geopolitical tensions that continue to disrupt global supply chains and intensified competition following industry consolidation.
”These factors mean that we enter the second half of the year with an outlook for highly volatile and unpredictable demand and continued margin pressure,” global chief executive Allan Melgaard said.
”Our task will be to maintain agility in our operations, leverage our scalable platform, and respond quickly to changing customer needs – while keeping our long-term strategic course on track.”
He added: ”With a strong pipeline, a growing global presence, and dedicated teams across markets, I am confident that, even in a more challenging macroeconomic environment, we are well positioned to deliver on our strategy and create value for customers, employees, and shareholders alike.”
Cost savings
The forwarder also warned that it would embark on cost-saving activities to tackle the current market volatility.
”We will take relevant measures considering the current market situation and initiate a reduction of our current cost base to mitigate the uncertainties in the market.
”SGL has in recent years remained committed to its strategy and deliberately kept our current staff levels to be able to act agile and to manage the increased complexity of shipments.
“However, the geopolitical turmoil has impacted activity and margins to a larger extent than expected and combined with the uncertain time ahead, various cost-saving initiatives are necessary.”
