Hi, everyone, and welcome to the DSV third quarter 2023 Earnings Results Conference Call. Today's call is being recorded. For the first part of this call, all participants will be in a listen-only mode. Afterwards, there'll be a question and answer session. To ask a question, please press five star on your telephone keypad. I would like to introduce today's speakers, CEO Jens Bjørn Andersen, COO Jens Lund, and CFO Michael Ebbe. Speakers, please begin. Good morning, everybody, and welcome to the Q3 2023 conference call here from Hedehusene. We'll go through the presentation as always, and try to leave as many minutes as possible for questions. If you go to page two in the presentation, you'll see the agenda for this morning. Also, please take your time to read the forward-looking statements. Can I also please kind of ask you only to pose two questions each when we get to the Q&A session? I've seen there's already a lot of people queuing up, so it will be a pretty busy morning. So let's go straight to the presentation on page three, where we have some of the highlights of the previous quarter. We're happy with the financial performance. It's exactly as we had expected, actually when the year started and also three months ago. So strong performance, we think, in a still somewhat soft market conditions, and we don't really anticipate any real recovery in global freight volumes this year. We'll come back to that a little bit later. We found it appropriate to shave off the lowest part of the range in our guidance, so now we have a new guidance from this morning, meaning that we hope to achieve an EBIT result of between DKK 17.5 billion and DKK 18.5 billion. The cash conversion is still pretty strong, strong, and we have initiated a new share buyback program that Michael Ebbe will also elaborate on later on. We're also very pleased this morning about the fact that we are announcing an agreement, a JV agreement, with NEOM. It is really a significant growth opportunity for DSV, and we're super excited about the prospects of taking part in the very large ambitious program. So we will touch upon that later on in the presentation, will be headed up by Jens Lund. About a week ago, we also announced some changes to the executive management. I will step down no later than end of September next year and hand over the reins to Jens Lund. Just let me reemphasize that there is no changes to the strategy, and to the operations or anything else, in DSV. You might as well spare your time, and not post or ask questions about this topic, because we will not get to a situation where we can elaborate much more than that. I think everything has already been said in this respect. Let's go to page number four. Air and Sea, strong performance once again. We've seen a development in the quarter when it comes to EBIT, in line what we've seen in the two other quarters, the two previous quarters. Everything has transpired the way we had anticipated. Volumes have slightly improved, and yields have, especially in air freight, continued to come down. Bullet point number three might be interesting for you to dwell upon, meaning that the number of shipments, the jobs that we also count apart from TEUs and tons, were only down 1% in Q3, and minus 6% year-on-year, or for the full year. So we are happy about that. It has been more resilient than the number of TEUs and tons. Still, I think the division and the management and all employees in the division can be extremely proud and happy about a market-leading conversion ratio of 52.8%, which has been stable throughout the last quarters. And also an EBIT margin of 15% is something that stands comparison to most other companies in our industry, so we're very happy about that. So it's been a good quarter for the division. A little bit more flavor when you go to page five, Air Freight. We've changed the slide layout a little bit just to emphasize on the left-hand side the development in GP, so we don't only get lost in yields and volume. After all, it is the GP that we live from in the company. Still lower demand on air freight, and we have seen a certain shift away from air freight to sea freight. We've had a consequence that the gross profit yields have declined, but they have kind of stabilized now around a level which is DKK 9,500. It could still decline a little bit in the coming quarters. But we are slowly getting to a situation where we don't think it should drop much further. You can also see that we've seen improvement in the volume development, even though we are still in negative territory, we are minus 14%, which is still unfortunately a little bit worse than the market. But we do go for profitable growth, and it's one of the reasons that we are slightly yeah behind, but an improved development, so all in all pretty good. Next, page six is Sea Freight. Much more stable situation on the left-hand side when it comes to the GP, more or less in line with what we've seen the three previous quarters. We have actually. First of all, we have not seen any peak season this year, as we have not for a long period of time now. Probably a little bit less positive than what people thought six months ago, where we did same goes for Air Freight, for that matter, where we did think that things would improve when we got to the period we're in right now, but that has not really happened, so still pretty soft markets. Having said that, we did see a positive year-on-year growth at the end of the quarter, and it's not unlikely that that will continue into Q4, so we will see positive volume developments on the markets for Sea Freight. On the high right-hand side, you can see the volume and yields. So sequentially, we are up on volume compared to the last two quarters, and year-on-year, we are only down 4%, which is more or less, I would say, in line with the market for the quarter. So, an okay development for Sea Freight. It seems to have kind of found its right levels, both in DSV and in the markets. Page seven talks a little bit about Road. I think it's quite remarkable that we, with a 10% decline in revenue, can see a positive EBIT growth of 1.5%. It's a testament to all the hard work which has been put into the division, and we're very pleased about that. Also gross margins and conversion ratios and EBIT margins, for that matter, developing as we had expected. So, strong work. We see the effects of some of the structural changes we have done in the division. When it comes to the Road way forward, there's been some sort of misunderstandings in the press that we have shut this whole program down. It's not the case. We have changed certain elements of the TMS system. They have been put on hold, and I'm sure if we get some questions, Jens Lund will take the opportunity to talk a little bit about the Road Way Forward program and the status that we have at this moment in time. The program continues. The objectives are exactly the same as they've always been, but the change will cause some minor delays. Last page from my side is Solutions. A little bit the same story as with the Road. We've stopped the kind of deteriorating development in EBIT, and year-on-year, we have a flat development, which is pretty good achievement, I think. 0.1% down if you adjust for the currency impact. So, even though we've seen lower activity levels, we've seen margins going up from a gross profit perspective. So, very strong performance in the division. We are normally quite busy in Q4, so we hope that the division will also end the year on a high. So I think that was it. Right now, I would just like to pass on the word to you, Michael. Thank you very much. Then we will go to page number nine with the P&L for the first nine months of this year, adding up all the comments from Jens Bjørn from the divisions here. A few highlights that is worth mentioning here is, if you look at the revenue, it's much in line with what we have said in the Q2. Revenue is obviously impacted by the significant decline in the freight rates and also the declining volumes. Our gross margin is supported by the continued high yields in the Air and Sea, and then also the improved margins that we have seen both in Road and Solutions. Like, Jens Bjørn also mentioned this, that is, you can see that we do have some headwind for the foreign exchange rates also on our EBIT results here. One thing that we also monitor very closely is, of course, the cost base, which we have talked upon on several occasions as well. If you look at the cost base compared to last year, we've managed to decrease that, and that's in spite of the cost inflation that we have seen all around the world actually. We have roughly 1,500 fewer FTEs compared to same period last year, and the reduction is mainly in the Air and Sea, which also the division where we have seen the most volatility in terms of results. Then, if we jump to the financial items, the FX, we've also talked about that before, but this quarter is significantly impacted by the negative FX adjustments. And it is related to intercompany balances, and that's the way we have to do it according to the IFRS regulation. And a little bit strange, if you look in the statement of comprehensive income, you will see the opposite development, where we have a huge loss here in the P&L. And then on the statement of comprehensive income, you will see a significant gain. And that's how we have to do it according to our IFRS. And the last thing that I would like to draw your attention to here is if you look at the EPS, which is something that we always talk about. It's have declining, of course, but not to the same extent as our results show. We have a EPS of more than DKK 61 per share for the first nine months, so that is satisfactory as well. If we then jump to the next page, where we have the cash flow statement. Very pleased to see that we continue our very strong cash conversion, so all the money that we earn are actually translated into cash, and that's a good thing. That's also what it's all about. It's the cash. We have seen, for the entire period, we have seen significant Net Working Capital improvements, of course, because of the lower revenue and then also the way that we continue to work to optimize the Net Working Capital. Then we have paid a little bit more in taxes due to the results from last year. So nearly DKK 1 billion more than last year, giving us a free cash flow of nearly DKK 13 billion for the first nine months. If you look at our Net Working Capital, it's a little bit above 2% of the annual revenue. I think I've, at earlier occasions, highlighted that we should be in the range of between 2%-3%, so I think that's very satisfactory for us. The gearing ratio is coming up due to the pace of the share buybacks as well. So our gearing ratio is 1.4. Bear in mind that we still have our ambition to stay below 2x, mainly 1.75-ish. It's where we would like to be in the long range. We have a good, solid foundation for our facilities. We have almost eight years in duration at the end of Q3 2023. So we are good equipped on that, well, on that occasion. If you look at the next slide, which is the allocation to shareholders, like Jens Bjørn mentioned, we have initiated a new share buyback program of DKK 2.5 billion this morning, that will run until the end of January. This means that we, in the first nine months, have bought back nearly 9 million shares at an average price of DKK 1,300. So own shares representing 3.8% of the share capital. If you add it up, what we have allocated back to the shareholder for the first nine months, it's nearly DKK 13 billion, if you take Q1, Q2, and Q3 as well. It is a coincidence that it's exactly the same amount in Q2 and Q3. It's not something wrong with the formulas in that slide. Then, the last slide on page 12 from my side, like Jens Bjørn also mentioned, that we have adjusted our guidance a little bit. We have narrowed the range, like we normally also do during the year, meaning that we expect that we will end up between 17.5 and 18.5. And that is what we will like to guide. And then we have the main assumptions here, that we expect it continues more or less than what we have seen, slightly better than Q3 for the volume part. Like Jens Bjørn also mentioned, that it could be that the yields would slightly decrease as well. So that's about it from my side, and I will hand over the word to Jens. Look. Thank you very much, Michael. And, for me to put a few words on, on what we've announced as well on the NEOM project is a JV, together with a NEOM company, which is owned by PIF, which is sort of the investment arm of the Saudi Arabian government. What we plan to do is to establish a JV company that will handle the logistics requirements of the city, NEOM, that is going to be built in the Gulf of Aqaba. We will hold a 49% stake, and we will be sort of the operational partner for this logistics JV. I think we will have to say that it requires the regulatory approvals of the competition authorities before we can go live with the JV. But today we've now announced it, and I'll give a few financial details on the JV as well. So if we move to slide number 14, we can see that it's a gross investment of $10 billion. And the shareholder funding required to deliver on the JV is $5 billion, whereof we will furnish the JV with $2.45 billion. We expect normal return requirements as you normally would see in DSV, and the ramp up will happen sort of gradually. I think the investments will be more or less made during the first five years. It might take six years. It depends a little bit on how the project is evolving. And then you will have to account for this in your models in a one-liner. And of course taking care that we will disclose the results and how we're progressing in a note to the reporting that we produce, so that you can measure us on basically our normal metrics or the return on invested capital that is required. In order for us to be accountable for the money that you provide for basically the capital that we allocate. So a little bit, basically, on NEOM, I think it's a very audacious approach, where they actually, when they build this city, they're gonna consolidate all the inbound flows with one vendor. So instead of replicating supply chains for every little sort of contractor or large contractor on the project, we can actually consolidate the volumes, and thereby reducing the resource consumption and of course, also then, for example, for either economic or CO2 footprint, consume less resources. So it's a significant achievement. We've managed to basically be chosen as the partner on this contract, and we're very proud of this. And I think we can attribute it also to the team that has participated internally on this. It's a very well done job, and now we start to get closer to execution mode. So I think that was a little bit on the NEOM side. You'll probably have some more questions, and we'll be happy to answer them. And I think we can skip to the next slide. Here it says that if you want to ask a question, you will have to press five star. So we're ready for questions. Thank you. We'll now start the question and answer session. If you do wish to ask a question, please press five star on your telephone keypad. If you wish to withdraw it, you may do so by pressing five star again. There will be a brief pause while the questions are being registered. The first question will be from the line of Michael Rasmussen from Danske Bank. Please go ahead, your line will be unmuted. Yeah. Thank you very much. And, I also wanted to say, thank you so much for Jens Bjørn's great process over the years, and warm welcome to Jens Lund, once it's time for you to step up as CEO. So, two questions on NEOM here. First of all, maybe you could talk a little bit about, was this a tender process, i.e., were you up against other large logistics providers on this, or have you been kind of solely negotiating this from the start? So that's my first question. My second question is a little bit trying to understand the cash flow profile and just the whole timeline here. Jens Lund, you mentioned a few more details in terms of CapEx, but maybe you could just tell us a little bit more in terms of when we should exactly expect the net cash flow from this to be positive. And also, what happens after 2031? Will you still be the exclusive have the exclusive rights on providing logistics, or will there be a new tender process at that stage? Thank you. Yes, it was a... Thank you for the questions, first of all, and, you know, happy to answer them. The tender process was basically initiated in the second half of last year. There was several parties involved. Obviously, we don't know who of our competitors participated. I would presume that some of the larger players have probably been invited, because it requires significant capacity to be able to handle a task like this. I think some of the things that has sort of been clear in the tender process is that it's been crucial that we already had a significant presence in Saudi Arabia. We are a leading player there, but also in the region. I think many of the competencies that we got in via GIL basically allowed us to perform well. At the end of the day, with the capacity we have as a large player, plus on a global level, plus the regional capacities, I think that has convinced our partner that we are the right company to do the job on their behalf. So I think that's basically how it's all evolved. Then I think we can talk a little bit about the cash flow. I think it's clear that when you start an operation and it's basically in the desert and, you know, it's a remote area where there's no infrastructure available-... We have in the beginning to establish infrastructure, so could be laydown yards, could be logistics facilities, and different types of equipment needs to be in place. Of course, we will have to invest in the beginning of the project, and then when the project matures, we can then really push volume through these facilities, this infrastructure. So, I would expect that the first five, six years we will invest quite heavily, and then, as time goes by, we will then leverage on the infrastructure. So we have then, of course, had some discussions about, you know, our relation to our shareholders, where, of course, they expect a return on a continuous basis. So that's also basically the foundation for the work that we will be able to invoice the cost in relation to the project to NEOM with a margin, sort of, that allows us to produce a return on the capital that we deploy. So should be fairly straightforward that we will be able to deliver on the return on the capital that we deploy. Then in an arrangement like this, we have exclusivity, actually, until 2031. And at that point, the company would typically be operational, and then we have a benchmarking exercise that has to take place so that we are certain that the prices are correct. And then this benchmark exercise have to take place every five years. Of course, we expect to be competitive at that stage so that we can continue that journey on the JV. And then actually, once the city is up and running, there's the construction logistics where we built, and then there's the end stage where people actually start to live in NEOM. When they live in NEOM, they will lead normal logistics, and that will be open for competition from 2041 and onwards. So until then, we will do all the port to city distribution in NEOM. So I think that was a little bit more color on the JV arrangement. Great, thank you very much. Sounds super interesting. Thank you. Thank you, Michael. The next question will be from the line of Cristian Nedelcu from UBS. Your line will now be unmuted. Hi, thank you very much. Two questions, please. The first one on NEOM. So you mentioned a 20% ROIC target on the $2.5 billion investment. So that's roughly half a billion dollars of profit for DSV. How much of that profit should we capture by 2026, 2027? Could you talk a bit around that? And then if I understood well, this $2.5 billion investment should be split equally over the next five years. Is this the way it works? And just secondly, very briefly, if I may, in terms of your Air and Sea, other expenses and staff costs, you have reduced costs by DKK 250 million in Q3 versus Q2. How should we think about Q4, and then going forward in 2024? Air and Sea, other expenses and staff costs. Thank you. Yep. I think I'll answer the NEOM one first. I think the investment, I would probably in the model, try to spread them out over the first five to six years. And then, of course, the volume produced will then increase over time. And I think, you know, the max volume that goes through will probably be there in 2030-2031. So at the end of the JV, sort of, at that time, can also perhaps be in 2029. It's a big project, so some things might move a little bit faster, some might move a little bit slower. So if you model it like this, you should be safe. And then I think on to you, Michael. Yeah. The other external expenses, there are two factors impacting this. Of course, one thing is that when number of employees are lower, then all the overhead costs that goes with that is also decreasing, of course, in terms of licenses and what have we. And then another, we have had a reversal of some smaller bad debt provisions as well in Q3, in Air and Sea. So we expect that Q4 will most likely be DKK 50 million-DKK 100 million higher the next quarter. That would be our expectation. Thank you very much. Thank you, Cristian. The next question will be from the line of Robert Joynson from BNP. Please go ahead. Your line now will be unmuted. Good morning, gentlemen. A couple of questions from me, please, on NEOM as well. Could you provide some detail in terms of what the investment will involve? So what type of assets? I mean, with reference to the $2.45 billion, like, will the bulk of that be spent on hard assets? Could you also maybe just provide a bit of a kind of color on the extent to which it will be allocated to Solutions versus Air and Sea and Road? I'm assuming the vast majority is Solutions, but maybe I'm wrong. And maybe just some kind of color as well on the economics of the deal. For example, the kind of open book versus closed book characteristics or any other detail that you can provide. Thank you. Yes. I think when it comes to, what can I say, construction logistics, there are various types of assets that you need. There's a lot of, what can I say, bulk stuff that has to be moved in. So of course you will have to charter capacity for that. If we charter capacity, it will always be with a off-take agreement so that we don't procure capacity that is not needed. So that we sort of have our 3PL thinking over it. But let's say you make, you know, some arrangements for this capacity that run a little bit longer, then of course this will have to be reflected in the balance sheet. If we then take on the... So this is basically some of the charter capacity that you need on the sort of big volumes. Then when we come on land, you need laydown yards, and you need big facilities, physical facilities for that. So we will construct that as well so that we can handle the volume. There's nothing there, so we need to basically establish this. When we establish these things, there will also be off take agreements in place because, of course, the alternative use in a place like NEOM is not available. So they will have accepted to assume the risk. I mean, they have the risk on the city. Anyway, so this is basically then how it works. Also, the assets that we then need to transport, the volume with on the ground for construction logistics, in the beginning, there's no 3PL market, so we will have to establish, you know, or capacity ourselves, but then when it matures, of course, other players will enter into the market as well, and we can go to a more 3PL-ish thing. These things, they won't be booked in, in DSV's Road, Air, and Sea or Solutions division. They will be basically in a separate node in our accounting, and then we will basically have one line in our P&L. So this is basically how it's going to pan out. Then for the end state, so when people they start to live there, we need normal facilities for distribution centers, and normal distribution capacity. The whole idea is that everything is railed, and this is something that NEOM establishes themselves, the basic infrastructure. So, that's basically part of the project that they established, this infrastructure. It's not us. So we can, or we are actually obliged to use that infrastructure that they put in place. But the DCs, we will have to ensure that this capacity is built up. And as I said, from 2041, competition will have to, or will be allowed to come in as well for a certain proportion of the volume. Then the project has matured, and I think it'll be beneficial that there will be other parties in the market to compete as well. If I can maybe just push my luck with one follow-up. Is this type of deal kind of representative of the type of deal that DSV shareholders can expect to see more of going forward, or is this more of an exceptional circumstance? I think it's an exceptional circumstance for NEOM here. It's a... At least I've never seen a project like this before. It's basically a vision of the kingdom to transform, what can I say, the country, and provide a place for the next generation to live in that is sustainable. There's probably not many countries that have the capacity to run such a project. I will, though, say that the project logistics and the way we are handling it represents actually a significant opportunity because there is efficiencies connected to the consolidation of the inbound volumes. So, consider an example or benchmark for other projects on what proportion of the cost base should be attributed to logistics. But here we also have to prove this, that it will work in the real world. But given our experience so far, we are confident that we can deliver on this. Understood. Thank you. Thank you, Robert. The next question will be from the line of Alexia Dogani from Barclays. Your line will now be unmuted. Yeah, good morning. Thank you for taking my questions. And first, Jens Bjørn Andersen, congratulations on a great tenure. I know you said not to ask about this, but I'm gonna try my luck. That's my first question. In terms of, Jens, I think the chairman in the Shipping Watch interview indicated that as part of the change, there is also a renewed push to larger customers. Can you expand what this could possibly mean in terms of volumes, yields, how you kind of organize the company around the country level structure? So that's one, my first question. And then, the second question is, you talk about no real recovery in trade activity in 2023. Do you think that, as we go into 2024, we do get some recovery? Given the fact that yields continue to normalize, are you confident you can keep EBIT flat, absent M&A? Thanks. Okay, I can say a little bit about the strategy. I think the strategy work that we've been doing for, you know, for years, but we've intensified in the last couple of years, actually, is due to the fact that we've become a significantly larger company. The customer profile we've looked into has always been the SME, and that's always a very important part of our business. I think it's also fair to say that over the years, when we have acquired companies, we've also gotten, what can I say, involved with larger accounts. And of course, larger accounts, they perhaps have demands when it comes to our network. So let's say our groupage network and road, our LCL network, our air freight consolidation capabilities that we're running. We have focused on services like this in our strategy work. We could also, for example, say that the consolidation of our infrastructure has been sort of intensified. Not that we've not been doing it for years, but actually we've even put more pressure on the organization to continue that journey. And of course, many of these things, they are important to the SME segment, but they perhaps more focus on the local level, where the larger accounts, they want to see DSV as one company, as one enterprise. And that's basically the push that we have, that we have a stronger product when we face these customers. And of course, then our commercial approach also has to be adjusted to reflect this, so that we come across with some capabilities where we can lean in on their demands, so that we basically can you know ease the way they run the company. I mean, the supply chain is crucial for all companies, and we are an important part of this. And in order for them really to perform the companies, they need partners that have some muscle when it comes to some of the things that I just mentioned. So I think this is basically the focus that will continue. And of course, the ambition is that we can outgrow the market. It's an ambition that we've had for years, and I think this ambition still stands. So, there's nothing new on that front. Then I don't know who will take the general economy. Will you do that, Jens Bjørn? Yeah, I think it's very uncertain for us. We just have no kind of data points that show a significant tick up in activity levels. There's a lot of geopolitical unrest now, as inflation kind of situations. So, what we can see, though, one data point that gives us some sort of comfort, is the fact that inventory levels are coming down now. It's also about time, so that should, of course, lead to some support in Sea volumes. And as we've said, we are in positive territory year on year when it comes to Sea Freight volumes, and you can discuss on which background, but nevertheless, that is the fact. So, but again, I mean, we take the market which will be given to us, and we are optimistic, and we will, we are confident in our business model of being asset light. We'll adjust the cost base accordingly, and then, I'm sure 2024 will be a decent year for DSV as well. We look forward to talking a lot more about that when we give the guidance in conjunction with the annual report of 2023. Thank you both. Can I just ask a follow-up on what kind of Jens Lund helpfully elaborated on? I mean, obviously, DSV's kind of leading margins has been built on the fact that you have this SME focus, this country-level approach. Do you think when you take a more of a network, yeah, oversight, that the profitability of the overall business is unaffected, i.e., there is no puts and takes between countries that help the network, but potentially, initially bring down performance? No, I think that we've seen when we consolidate the volumes in these things, actually it provides, what can I say, further potential for benefits for us. And we don't see that the GP that relates to the things that we venture into is very different from what we experience on the other accounts that we have. So it's not like we have, you know, a secret source for income that is sort of not subject to competition. I wouldn't say so. And I would say that already today more than half, actually, probably more than two-thirds of the GP that we produce in the company, it comes from larger accounts. So it's not a big swing that we are seeing. I think it is a continuation of the journey that we are on. So you shouldn't be too worried about that. Great, thank you very much. Thank you, Alexia. The next question will be from the line of Lars Heindorff from Nordea. Please go ahead. Your line will now be unmuted. Yeah, thank you for taking my questions. The first one is regarding the yield development, Jens Bjørn. You mentioned in the beginning that the number of shipments was down by only 1%. So the discrepancy between the decline in shipments and the decline in reported volumes in TEUs and tons, I mean, how much of that is contributed to your efforts and your focus on LCL volumes? And how much do you think is actually sort of just market development with the smaller shipments? Yeah, there's one obvious answer to that question. I think it's a combination of both. It's actually the truth. We have pushed the LCL product much, much more than we have in the past. It's been highly successful. It's been a little bit of an eye-opener internally in the division also to sell this product in a more structured way than what we did before. Take more ownership of the product instead of just booking it to a co-loader. We've established our own product. We handle it operationally in our own network. And that's actually something that goes down really well with our customers as well. And then there's some structural reason for it as well. You correctly pointed out, Lars, that the sea shipments have probably been smaller. And of course, we have to see what effect that will have if things start to change again. But it is still a fact that the real KPI for us, it's the number of invoices that we send out to our customers, and the trigger for that is the number of shipments. Any change in that? I mean, you mentioned yourself that you've seen sort of the shipments become smaller. I mean, can you... is it still trending downward or signs of it sort of leveling out? I have no access to that information. I think as we point out, actually, the discrepancy, as you say, has been a little bit bigger now. It's... We are happy about that the number of shipments are only down 1%. So, but overall, I don't think I don't expect any material changes to that situation. Okay. And then the second one is on the Road, volume, sorry, not volume. Revenue down by 13%, quite a bit more than what I had expected. So maybe just a few words on that. Is this volume, so it's prices or it's combination of those two? And if it is, you know, what is the split, sort of, roughly, at least? And then also, maybe a follow-up on that, again, in the Road, the number of employees actually being up, despite the decline in the top line, just maybe an explanation for that. I think it's mainly pricing, which has, which has improved, volumes. We have taken market share in Road. We have a good product. We've really, as we've talked about on previous occasions, seen a really good development in some of the large countries, Germany, to mention one, where we have a very strong momentum, that can actually move the needle, quite a bit. So I think that is some of the reasons that, that lies behind the, the development in Road. Number of employees, I think, we have invested a little bit in implementing some of the, the projects that we have been talking about in Road. Of course, we monitor the situation very much. It's a country like South Africa that plays a big role in number of employees as well. Of course, we are monitoring the situation, but we have not felt the necessity as we had in Air and Sea to go in and adjust the cost base, as volumes have actually held up pretty nicely in Road. Of course, we keep an eye on the whole situation. I don't know, Jens or Michael, if you have anything to add. No, I think it's exactly as you say. So we are, of course, monitoring it very closely, because if it slows down, of course, we have to stick to our asset-light model. So I think that's basically what there is to say. All right. Thank you. Lars? Thank you. The next question will be from the line of Peter Sehested from ABG. Please go ahead. Your line will now be unmuted. Yeah, great. Thanks for taking my questions. The first one is on, pertaining to NEOM, but also Schenker. The board of DB has decided to sell Schenker, and I guess that you are a clear contender to bid for that one. So my question here, how have you thought about managing two potentially large projects? So that is a question pertaining to the scope, not only of Schenker, but also to the scope of NEOM in terms of internal resources, project management, et cetera. The second question I have is actually a bit of a follow-up to the previous discussion that was here about LCL and larger clients. Does this move towards larger clients also imply that you, if, by default, have slightly lower or less of LCL volumes that you have now, given larger clients, larger volumes, et cetera? Thank you. I'll try to answer the first question to my best ability. We don't comment on specific names, competitors. We think that would be inappropriate. What I can say, though, is two things. One is, the strategy of DSV is unchanged when it comes to growing through acquisitions. We like to grow organically, and this is a huge step that we take in organic growth this morning by announcing the NEOM project. But we still have the ambition also to take part in the consolidation of our industry. And you should not think that the NEOM announcement will prevent us from doing a large-scale acquisitions in the future. That will still be possible for us, and I think that's as much as I can say on that point. And I don't know, Jens, if you wanna take the other- Yeah Point about LCL. LCL is certainly also larger accounts, that we produce in the network. They would then have 10s and sometimes 100s of thousands of cubic meters that has to go, basically, from one to three origins to many, destinations. But there's not enough volume to fill up a whole container, but you need, what can I say, a high frequency on the movement of cargo. So that would be very good, customers to get into our network. But then it works well in combination when you then have these lanes with smaller accounts, medium-sized accounts, because then you would have what you call base load, and then you can fill up the container. At the end of the day, whether it's a 20-footer or a 40-footer, or a 40-footer high cube we use for moving the LCL cargo in, what is important is the fill rate that we get it filled up, and then you make actually quite good margins on these containers. You need the volume. It's both small and large accounts that we move cargo for. Okay. Thank you. Thank you, Peter. The next question will be from the line of Renee Nalbandyan from Bank of America. Please go ahead. Your line will now be unmuted. Good morning. This is the first question on NEOM, actually. Curious to understand why you thought of this or have set it up as a joint venture, agreement here. Just going back to the earlier question on capacity for M&A, like, how do I think about it from a balance sheet room perspective, given what you've outlined on this investment? Secondly, just on the near term, like, you've talked about uncertainty on freight volume recovery. How should we think about unit GP in Air and Sea versus, volume outlook? Like, are you saying that unit GP kind of is finding a bottom, at least in Sea, but volumes are uncertain? So if you can help us understand the movement between those two into an uncertain next year. Thank you. I'll try to answer the last question first. It's associated with great uncertainty. I mean, we simply cannot give any kind of firm guidance on that. We think that Sea Freight yields are reaching some sort of plateau. Volumes look satisfactory. We hope to see growth in volumes both in the latter part of this year and also for 2024. Air Freight is a little bit more doubt associated with that. We've probably not seen the bottom of yields yet, but also here, we do see improvements in volumes, but we'll probably not see positive territory growth-wise this year. We probably need to enter 2024 before we see that. We're trying to kind of balance the two, if you know what I mean, so we will achieve some sort of growth in absolute GP, which is, after all, the most important kind of factor for us. And I don't know, Jens and Michael, if you wanna talk, maybe Michael, on the M&A and balance sheet, kind of capabilities or, Then Jens can take the last question about the JP part. Yeah. Yeah. It's from the capacity and the M&A, of course. I think that we have a strong balance sheet to look at already now, and then, of course, there will be, you can say, cash flow along the way as well. And then, of course, it's also a matter of balancing this out. So I think that... One last thing in that aspect is also bear in mind that it's, when we talk about the commitment, like Jens Lund explained about before, it's over an eight-year period of time, for the NEOM part. So I think we have a, let me say, a strong balance sheet and y eah, also use the cash flow, of course, that both the JV will generate, but also the cash flow that our business will generate alongside. Yeah, I think it's important that, you know, one of the reasons why NEOM actually wanted to participate, it's actually twofold. One of them is, of course, that they are control, what can I say, the offtake of the whole project, and then they saw that logistics is a main constraint for them. So they wanted a solution where sort of this was taken into consideration to do it in the most efficient way. And of course, because they had the audacity to do so, they also said, "Listen, then we also want part of the upside." So they wanted a network business like we have where they then are a local partner in this specific area so that they get part of the upside. Of course, the JV will then generate income as we go along, and we will reinvest that into the JV. So it's not like we will have to send all the money down there. Actually, the money will be generated once we've got it started up. But I think when you've done your models, you can probably model that yourself, that with the return expectations that we have, there's gonna come cash flow out of it, and we can then continue to invest in the JV. And as always, it is like this, that you have to invest to harvest the benefit afterwards. So there's really nothing unusual in the way it's set up. Thank you, Renee. The next question will be from the line of Dan Togo from Carnegie. Your line now will be unmuted. Thank you. First, on NEOM, have you leaned out in any other way than the capital commitment here? I think about capacity-wise, and also maybe on carbon footprint, ESGWise, on the capacity that you will provide such a long stretch into the future. And also, how should we think about your return here? An absolute return of up to $500 million, how will that be split? How visible, what will we see in the JV line, and what will impact, so to say, the organic part of the business, i.e., the volumes that you will attract to the rest of the business? And my other question, or part of the question here, is on air. You continue to lose a bit of the share in air volumes, in particular. It seems you're more in line, as you mentioned, in sea. But what explains this deviation from the market, and what can we expect going forward? I know you have ambitions to gain share, but what are the, so to say, the initiatives to get back on that track to start gaining some share in air? That was my questions. Thanks. Yeah, I'll take the last question again. We cannot sit and elaborate on all the initiatives, but trust me, Dan, we have plenty. We are have extreme focus on growth, both when it comes to Air and Sea. We know that we are a little bit below market. I think the gap is closing in, and we're not gonna issue any kind of guidance on when we will have the gap closed. It's still a super, super competitive market. We do still see that some are operating own capacity that has access to rates that is simply not possible for us to obtain, for good reasons. We are not in the business of moving freight with losses. We've said that many times, so, a lot of initiatives are in place. We're adamant that we will also when the markets kind of normalizes that we'll get back to taking share. We've demonstrated that many, many times over the years, and, and I'm sure that we will get back in that situation as well. I don't know, Jens, on, on NEOM and what, what kind of guarantees we've given on capacity and stuff. Yeah, you can say, of course, we've given the... what can I say? The commitment that we will develop and build the organization that can handle this. So of course, that is a commitment where we will, of course, take some of the strong members of our team and deploy them in NEOM. We already have, because we do business basically from our local subsidiary with NEOM, and support them already now. So we have people on the ground, and actually, I'm going down there Thursday as well. Tomorrow, go to Riyadh to meet some of our counterparties there at this, they call it the Davos in the Desert. But it's kind of a summit that they have there, where we will meet some of our partners. We will then go to NEOM and meet up as well with the team and some of the basically daily counterparties that we have. So we've committed that we build that up. Then, I think the way it will impact us, as I said, it's like in a separate note. And of course, NEOM, they have aspirations when it comes to carbon footprint as well. And so that basically they have laid out a plan for that. But the volumes that will not necessarily be counted in the DSV company, it will be counted in the JV so, so it'll be separate. But of course, we'll report on how it evolves. And then, we can see the developments, and in a way, we are indirectly accountable as well, for this. So we will also have to see, too, that it's part of the planning and the road mapping that we normally do in order to ensure that we deliver on our aspirations. Okay, thank you. Thank you, Dan. The next question will be from the line of Alex Irving from Bernstein. Your line will now be unmuted. Thanks. Good morning, gentlemen. Two from me, please. The first is on NEOM. Could I please dig in here on governance? So how are the strategic political goals of the Saudi Arabian government traded off versus profit-seeking? How does political strategy intertwine with the selection of, say, subcontractors or employment decisions? It's clear that DSV takes care of operations, but will the joint venture's goals be profit maximization or something else as well? My second question is on cost, particularly following up on an earlier question around air and sea and other external expenses. That's down 30% year-on-year, 14% quarter-on-quarter. You mentioned earlier, fewer licenses and a reversal of some bad debt provisions. Is that enough to explain a drop of this magnitude? And more importantly, how should we think about that particular cost item going forward, please? Thanks. I'll give it a shot at the first part of the question. It's obvious, I don't know what to think of that question if it's all only about profit maximization. It's never been that only in DSV. It's about a lot of things, kind of servicing a lot of stakeholders. We have had a very, very good dialogue with NEOM. We have a very long experience of working in Saudi Arabia. We've been in Saudi Arabia more than 20 years. We have more than 1,000 employees already in Saudi Arabia. They work according to... We have 20 locations in Saudi Arabia. They work 100% according to DSV Code of Conduct. The same goes, that is the foundation of this JV. It's based upon our ethical principles also in DSV. We actually take some pride in the fact that NEOM, they have chosen us also being a Danish company. And they really appreciate the way that we work, and we also deal with code of conduct and the way that we have set up our company generally. Then, of course, there's a commercial side of this as well, and we've kind of elaborated on that many times during this call also. We want to, of course, see a good return on the investments that we do. I don't know if Michael or- Then for the other external part, if you're right, it is enough to explain it, the decrease that we've seen this quarter. It's not only license cost, it's this license cost, travels, rent, and so forth. So it's more than just licenses. I know that I only mentioned licenses, but it's much more than that, the general overhead. And like I mentioned, at the earlier question, I think it will be around DKK 50-100 million higher in the last quarter. All right. Thanks. Thank you, Alex. The next question will be from the line of Sathish Sivakumar from Citigroup. Please go ahead. Your line will now be unmuted. And since we don't have any audio from him, we'll just move on to the next one in queue, and that will be Sam Bland from JP Morgan. Please go ahead. Your line will now be unmuted. Oh, yeah, thanks. Thanks for taking the question. I've got two, please. The first one is on the air yields. They've been quite stable for a few quarters, and then they, they dropped quite a bit in Q3. Was there anything in particular that changed, that caused that sort of fairly sudden decline? I know you talked in previously about sort of trading margin for volume. Maybe there was a bit of that. And the second question is, I think you said in a previous answer, that you expect to see some growth in absolute GP at some point, I think, in 2024. Is that sort of versus the current quarterly run rate that you're expecting that growth at some point? And I guess it's basically from what, from volumes recovering more than any yield pressure that's left to come out. Thank you. Yeah, thanks. No, I think it's. Thanks for the question. It can lead me just to clarify a little bit if there are some misunderstandings. What I wanted to say, maybe I didn't express myself perfectly clear, is that growth in absolute earnings is the most important thing for us. It can come from various ways. Of course, the balance between yields and volume, of course, you can live with lower volumes if yields are up, and vice versa. So, that's why I said it's the ambition for us is to grow the earnings, GP, in absolute terms. We are not guiding for 2024 yet, and we are not guiding on GP either for that matter. Of course, it would be nice if we saw some growth in GP, but that is still remains to be seen. When it comes to the air freight yields, I think it's more a reflection of maybe some of the, the contracts from last year and earlier this year, they have run out. They've had to be renegotiated. This was as expected. This is also why we have in the close dialogue we have with the investor community, that we have been kind of saying that it's not unlikely that yields would drop to the level that we are seeing right now, because we've had that knowledge. And it is also why we are saying now that it seems to have kind of reached a level. It's also based upon the information that we get out from the operations and from the strong exporting countries, where they can also see that the lion's share of these agreements have now been kind of renegotiated, and they're part of the yields that we are seeing right now. Yeah, understood. All clear. Thank you very much. Thank you, Sam. The next question will be from the line of Marc Sherlock from Stifel. Please go ahead. Your line will now be unmuted. Thank you very much for taking my question. Got a question on NEOM. Could you maybe explain a bit if what you think about the downside risk actually of this project? I guess the infrastructure projects usually are never on time, never on budget. So, if you kind of set up capacity and facilities, and then there's project delays, and the volume to transport, do you share, like, in potential losses in this joint venture the same you share in the profits, or is there any protection for you from yeah, from downside risk? And, is it in case you wanted to pull out at some point in a downside risk scenario, can you just do so? Is there any provision that you need to be locked up in this until full time, 2031? Or can you, in case, maybe leave earlier? And I guess you made a proper scenario on this. Can you maybe share what what you see as the highest risk or most losses that you might occur if this whole project is actually stopped in 2031 after you invested your share of the capital? That was my question. Thank you. I think basically, as you said, you know, it's an infrastructure project, so of course, there's probably gonna be changes, delays, postponements, and sometimes also things that needs to be expedited faster. Of course, we would have a JV arrangement in place, and one of the most important things that we've sort of agreed is that when we establish assets, there's always an offtake agreement, so a back-to-back arrangement. And we have also agreed with what margin we can apply to the capital that we deploy, because otherwise we would break the contract that we have with our shareholders. So of course, for us, this is the only way that we can conduct business there. If the NEOM project somehow is delayed due to things, you know, that are out of our control, and we have deployed capital, we still need a return. So, then, of course, there are, you know, put options for us in the arrangement and call options for NEOM, and I'll not go into the specific arrangement. But, I guess we've been in the business for years, and we have put in protections so that we feel comfortable that we can operate the business. And, if for some reason, at a later stage, you know, that things they turn out to be different, and all the investment we've put in, we've basically guaranteed a return on that. And then after 2031, if there's a new partner coming in, they will have to take over what we have in the books. Or let's say, I think you mentioned the example that it was stopped, then I guess something will already have been built, and it's up and running, but then the volume will be different. After that, that could also be an issue. So the only thing that you really have is the default risk, where you are dealing with, what can I say, in fact, a country. And we have basically opted to assume that risk, because of course, that's something that we can't really get any support on. Thank you very much. Thank you, Marc. The next question will be from the line of Ulrich Beck from SEB. Your line will now be unmuted. Yes, hello, thank you for taking my questions. I have two here. So the first one on the air yield development, can you perhaps give an indication of the level of the air yield at the end of Q3, given that the starting point in Q3 2023 was around, I believe it was 11,000 at the end of Q2, and with this average of around 9,500, the endpoint must be at least a bit below this 9,500 average. So if you can, please provide some color there. Thanks. It's not far from below 995. It's just a fraction below that. It dropped, and then it has actually stabilized throughout the quarter. Okay, so we can assume that these new contracts that were renegotiated, they had an impact from the beginning of Q3, is that correct? Maybe not from the very beginning, but from midway through maybe. Okay. And then a question on the Road TMS system. Can you please put some more words on, on this development that was put on hold, and, and whether this delay will have any impact on your conversion ratio target in, in the Road business? Yes, I can say a little bit about that. So, on Road, basically, we have some capabilities we need to deliver on in order to really, what can I say? To, to optimize, the, the things that we do in the back office on the system. So of course, it's the quote and book capability, which we have as a microservice already today, it runs. Then there's the booking and the booking domain, that's also basically something that we've pulled out of the system. And then, of course, it's the event set up as well, where you need a lot of events. This is sort of when you interact with the customer. This is typically something that the customer sort of sees or feels. Furthermore, also the billing is pulled out of the solution, and we have a solution for that. But the order management and the planning and the freight execution, this was actually what we used this specific platform for, and it turned out that we couldn't really make the necessary progress with the vendor that we had on this. So right now we are remapping the capabilities we need, and then we will map with... We have different types of software in our infrastructure that can probably from a, what we call a microservice perspective, cover these needs, and then we will have to use those tools. We would have preferred that we could have gone the other way. That's also the reason why we did it. But, it turned out that from an enterprise point of view, the product, it was not capable of basically delivering what we needed in order to succeed. So of course, now we have to do this, it'll probably slow us a little bit down, not on all the processes. I think you can also see on the numbers in Road that the LCL or the group's network, it actually functions. So, but, it may be... I mean, if I was running the model, I would probably delay the conversion rate to, you know, achievement with, depending on what you have in the, little bit, with six to 12 months. It's not that we don't know what we have to do, the way we had chosen to go there just turned out that that was not feasible. So I think that's a little bit on Road way forward. Thank you. That's very clear. Thank you, Ulrich. The next question will be from the line of Nicolas Mora from Kepler Cheuvreux. Your line now will be unmuted. Good morning, everybody. First question is on a key competitor from Switzerland going after SMEs this year increasingly, while you apparently go after larger customers. Both arguing that it closes gaps in each respective profiles, and I cannot help but see a certain symmetry here. Is it fair to say that there is also an element of technically exploiting what the counterpart does not focus on at the moment? That's the first one. And the second one, I appreciate that we have not seen a peak season in sea freight, and you haven't been enthusiastic about the prospects for air freight, but can you perhaps provide a bit of color on the sequential improvement from Q3 levels that you assume in Q4? Is it fair to think about it as sort of the highest volume quarter for 2023? Thank you. Yeah, that's a fair assumption to answer for air. That's definitely the case. You know, we have a lot of competitors, and we admire them all, some more than others. But we don't kind of run our company by looking at them and looking at their strategy. It's not like one goes for one particular area, and then we go for the opposite. We do what we feel is right for the company. I think it's been a little bit exaggerated, kind of the notion that we live from only small and mid-sized customers. We have had that discussion with some of the companies we have acquired over the years. It was a big surprise for them to see actually how the situation was inside DSV. Was probably a combination where we had a larger degree of large customers also. So, we like all our customers, and it's not like we exclude others when we focus now on a little bit more on some of the larger clients. It's a very maybe, it's maybe just to complicate things a little bit, it's important for you also to remember that the calculation does not only stop with the GP per unit. You should actually evaluate if a customer is good for you on the EBIT per unit. And it is a fact that with the large clients we have a deeply embedded technological solution that enables us also to have a high productivity so you could actually live from a slightly lower GP. Overall, it's we run the company based on our own strategy. Okay. Thank you. Thank you, Nicholas. The next question will be from the line of Cedar Ekblom from Morgan Stanley. Please go ahead. Your line will now be unmuted. Thanks, everyone. Hi, gentlemen. It's Cedar Ekblom from Morgan Stanley. I've just got a couple follow-up questions on NEOM. So clearly it's a great growth opportunity for the business, but the capital intensity of the investment, I would argue, is higher than your core asset light model. So a couple of questions there: When do we expect to actually see a dividend out of the business? We know that you need to spend $10 billion, of which $5 billion is equity. So can we assume that actually most of that cash flow that's generated is put back in the business over the next couple of years, and actually, cash returns to DSV are further out? And then secondly, just in terms of the structure of the investment, in order to enjoy upside in the longer term from a traditional 3PL business, can we assume that it was a requirement that you had to make this equity investment, that the optionality that was not there in the longer term, if the equity investment was not made? And then final question, does it mean anything for the wider business throughout Saudi? Does this entrench your, you know, traditional core asset light business in the region because of your association with the NEOM project? Thank you. That was quite a few questions. I think let's just take the Saudi business. Our Saudi business is a separate business, and it will stay a separate business. We've made a joint venture on NEOM, and we've not, you know, discussed anything else on that. I think what it will do is it will impact our network, in particular on the containerized cargo, where we will, well, basically probably provide origin services, I guess, for the volumes that are moved in. So of course, it will have a network impact for us, and this is then purely DSV. But of course, what goes on in NEOM, the JV will handle. So basically from the port to site, if you wanna call it like that. Then the 3PL thing that you're talking about, it's correct. In the beginning, when you start up in a new area, there's not much capacity available for 3PL, so we have to manage that. But I think fairly quickly, during the next sort of two to five years, let's say, the haulage capacity and, you know, various types of capacity will then be available. But in the beginning, we will have to take responsibility for that, as well. I also think on the facilities, that if there are no other parties to use them, I guess, you know, it is more like a ownership situation that you have on them. So even if you were able to construct some kind of a financial deal where you could get it off the balance sheet, I don't think you could provide an alternative user. And since we then have an exclusive JV, you know, I think you will find it hard. I think Michael Ebbe can probably educate us a little bit more on that, but that was how it was when I was the CFO, at least, and I don't think the rules they have changed. Then you talked a little bit about the cash return as well, and it's clear that in the beginning, you know, you always know that with investments, you put money in and then you get the money out later on. And, you know, I can tell you it's exactly the same on NEOM. So we will start to generate income very fast, but all the income that we generate will then be invested in the business. It will then be invested based on the return requirements that we have, so that when we deploy capital, we actually keep the deal we have with our shareholders. Then, of course, in the late 20s, I think we will be able to distribute dividend out of the JV, so that we then get money back. And I think that's sort of the normal profile of what can I say, business development that we have this ongoing in various places of our business. Same with M&A, we just get the money a little bit quicker. But we also invest first, and then we get the return a little bit later. I think that was a little bit, I think, answers to your questions, Cedar. Thanks very much. Thank you, Ida. The next one online is Satish from Citigroup, so we'll see if we got any audio from him. Your line will now be unmuted. Yeah, thank you again, thanks for taking my question. So I got two questions here. Firstly, on the volume development, you did comment that, on ocean freight, based on easier competition, you're seeing, year-on-year growth coming through. Is there any specific verticals on the markets that you could single out where you are actually seeing, rebound in volumes coming through year-on-year? And then the second one is actually related to, say, the transaction versus, say, volume, i.e., lower volume per shipment. Obviously, if I look at the end market, where we are actually seeing this increased LCL product penetration, is it in Europe or is it in North America? Again, any color on that would be helpful. Sure. Thank you. Some pretty granular questions. I mean, it's from the knowledge that we have, it seems like high tech has done pretty well in recent times, driven by also the semiconductor industry, which is also a space that we wanna get into or that we have invested into, as you've seen. The capital equipment has done fairly well, but the rest of the verticals that we follow, they have yeah, developed less positively or are still in negative territory with something like fashion being fairly low on that list, so to say. The second part of the question, I don't know if anybody was about geography. I was just preparing for the first part. Yeah. The basically, the LCL volume and or the lower volume per shipment. I would say that, I mean, there's great support for the LCL, both out of Europe and of course, also in the U.S. We see that it's doing pretty well. Latin America, actually, also sometimes a market we tend to forget, and of course, exports out of, what can I say, the Asia Pacific when it comes to that. So I would say it's a little bit, you know, spread all over that we have, you know, this development, see this trend. Okay, just a follow-up there. So in terms of Europe, North America, and Latin America, LCL, where are we actually seeing, like, a significant improvement in penetration? I don't know, you know, what the market is because there's not really. I can only talk about our own developments. Yeah. So, no, I meant, like, for your own mix, actually. Yeah. Yeah. So, if you sit and look like, at a market like, for example, Mexico, Brazil, things are, of course, really, what can I say, doing, pretty well, when it comes to, to these markets. Now we are consolidating a lot out of, of Hamburg, so the Northern European part into Hamburg, for example, doing pretty well, when it comes on that. If you take some of the Asia Pacific, countries, I would say many countries out of China, are actually doing pretty well, when it comes on that. And then the U.S. has always been a big, driver or engine in our company, so they always perform when it comes to these initiatives as well. So I think that would be a little bit more granular. Okay. Yeah. Thank you. Thank you, Satish. As there are no more questions, I'll hand it back to the speakers for any closing remarks. Thank you so much, ladies and gentlemen. I think this sets a new record for number of questions and time spent, so we appreciate that. We hope you've been able to answer as openly and transparently as always, all your questions. If not, please feel free to reach out to Flemming Ole Nielsen and the rest of the team in Investor Relations. Thanks for your call, and it's over and out here from Hedehusene, Denmark.