Geodis said "uncertainties" would continue in 2023 as the global macro-economic environment remains tense, although growth prospects for the transportation and logistics company "remain solid" on the back of its diversified business portfolio and geographic locations.
The outlook came as Geodis reported strong performance in 2022.
The logistics company reported revenues of €13.7 billion (US$14.54 billion) in 2022, up 19% from 2021, which it said was driven by sustained activity across all the Group's Lines of Business.
Geodis noted that this affirms the "relevance of its business model."
In the report, Geodis said its Freight Forwarding business benefited from a favourable market environment, as freight rates remained high in both air and marine transport. Nonetheless, the fourth quarter of 2022 marked the end of the price boom caused by the pandemic. Even so, prices remain highly volatile.
It said Contract Logistics saw a sharp rise in revenues in the United States as a result of business development and growth in volumes of existing customers. Business in Europe also continued to grow, despite an underlying decline in consumption in an inflationary environment as of the second semester.
Meanwhile, its Distribution & Express business managed to increase its volumes and its result by comparison with 2021 in spite of increased production costs owing to inflation.
Its Road Transport business also enjoyed a high level of growth, largely because of increased business in southern and eastern Europe.
Geodis noted that overall, this performance resulted in a significant increase in profitability, with EBIT increasing by 10% to €518 million (US$549 million) and EBITDA standing at €1,163 million (US$1.23 billion).
Uncertainties remain in 2023
"In 2022, GEODIS achieved a record level of performance for the third year in a row. These excellent results in a challenging economic and geopolitical environment stem from the expertise of our teams, the complementary nature of our various businesses and our ambitious development strategy," commented Marie-Christine Lombard, chief executive officer of Geodis.
Nonetheless, Lombard noted that challenges in the supply chain industry remain in 2023 — but the company is poised for growth with its diversified business portfolio and geographic locations.
"Although uncertainties remain in 2023, we remain confident in Geodis' growth prospects. Thanks to the diversity of our businesses and geographies and to our operational agility, we are looking forward to 2023 with determination," Lombard said.
"We will continue to pursue our growth dynamic in the service of our customers, the digitalization of our businesses and the implementation of our environmental commitments, which remain one of our key priorities," she added.
The company noted that the growth last year was boosted by various strategic investments it's made, including "targeted acquisitions" that it carried out last year, like the acquisition of Keppel Logistics, which has warehousing capacity in Singapore and has to strengthen the Group's Contract Logistics and e-commerce services in Asia-Pacific; and the acquisition of Need It Now Delivers in the United States, which operates an excellent domestic freight network.
Geodis said the proposed acquisition of trans-o-flex— a specialist in the controlled-temperature transportation of pharmaceutical products in Germany — is also expected to establish GEODIS as one of the most prominent players in the key market of healthcare and will significantly enhance its delivery capabilities in Europe.
It said that the completion of this transaction is scheduled for the first quarter of 2023.
In 2022, Geodis said it also increased initiatives to reduce carbon emissions across all of its lines of businesses, including greener fleets for road transport, acceleration of multimodal shipping, and development of an offer of alternative fuels for ocean and air freight.
"Solid outlook" in uncertain environment
"Although the current macro-economic environment is uncertain, Geodis' growth prospects remain solid thanks to the diversity of its business portfolio and geographic locations," it said in a statement.
Geodis noted that in the future, the Group intends to pursue its development and capture new markets by accelerating its digital transformation while enriching its portfolio of new offerings for its customers in all parts of the world.
