COPENHAGEN (Reuters) - Danish shipping and logistics company DFDS (DFDS.CO) cut its expectations for this year due to lower UK trade caused by the uncertainty ahead of Britain’s exit from the European Union.
DFDS, which operates one of the largest networks of ferry routes in and around Europe, said trade between the UK and continental Europe had dropped in the second quarter.
This followed a spike in the first quarter amid stockpiling ahead of the initial Brexit date at the of March, it said adding that another round of stockpiling might occur in September and October ahead of the latest Oct. 31 exit date.
“The exceptional uncertainty on the outcome of Brexit is currently reducing UK trade and visibility,” it said in its earnings report for the second quarter.
Shares in DFDS opened 4.9% lower.
The uncertainty was contributing to a “considerable slowdown in UK trade” because manufacturers together with importers and exporters were adopting a wait-and-see approach, DFDS said.
Due to this, it lowered its expectations for annual revenue growth to 6-8% from a previous growth forecast of 10-12%. It now expects EBITDA before special items of 3.5-3.8 billion Danish crowns (£435.8 million - £473.1 million) from a previous forecast of 3.8-4.0 billion.
DFDS said it had staff, systems and processes in place in case of a no-deal Brexit but warned that many of its customers were “not prepared for handling the transition due to insufficient awareness of required customs documents and systems”.
Reporting by Stine Jacobsen; Editing by Keith Weir