© Hamburger Hafen und Logistik AG

Agenda

Agenda

01

At a glance

Angela Titzrath, CEO

  • 02 Financial performance 2020

    Dr. Roland Lappin, CFO

  • 03 Guidance 2021

    Angela Titzrath, CEO

  • 04 Medium-term outlook 2025

    Angela Titzrath, CEO

    Questions & answers

    Angela Titzrath, CEO

    Dr. Roland Lappin, CFO

Disclaimer

The facts and information contained herein are as up to date as is reasonably possible and are subject to revision in the future. Neither the Company nor any of its parent or subsidiary undertakings nor any of such person's directors, officers, employees or advisors nor any other person makes any representation or warranty, express or implied as to, and no reliance should be placed on, the accuracy or completeness of the information contained in this presentation. Neither the Company, nor any of its parents or subsidiary undertakings nor any of their directors, employees and advisors nor any other person shall have any liability whatsoever for loss howsoever arising, directly or indirectly, from any use of this presentation. The same applies to information contained in other material made available at the presentation.

While all reasonable care has been taken to ensure that the facts stated herein are accurate and that the opinions contained herein are fair and reasonable, this document is selective in nature. Where any information and statistics are quoted from any external source, such information or statistics should not be interpreted as having been adopted or endorsed by the Company as being accurate.

This presentation contains forward-looking statements relating to the business, financial performance and results of the Company and/or the industry in which the Company operates. These statements generally are identified by words such as "believes", "expects", "predicts", "intends", "projects", "plans", "estimates", "aims", "foresees", "anticipates", "targets" and similar expressions. The forward-looking statements, including but not limited to assumptions, opinions and views of the Company for information from third party sources, contained in this presentation are based on current plans, estimates, assumptions and projections and involve uncertainties and risks. Various factors could cause actual future results, performance or events to differ materially from those described in these statements. The Company does not represent or guarantee that the assumptions underlying such forward-looking statements are free from errors and the Company does not accept any responsibility for the future accuracy of the opinions expressed in this presentation. No obligation is assumed to update any forward-looking statements.

By accepting this presentation you acknowledge that you will be solely responsible for your own assessment of the market and the market position of the Company and that you will conduct your own analysis and be solely responsible for forming your own view of the potential future performance of the Company's business.

This presentation is not a prospectus and does not constitute an offer or an invitation or solicitation to subscribe for, or purchase, any shares of the Company and neither this presentation nor anything contained herein shall form the basis of, or be relied on in connection with, any offer or commitment whatsoever.

At a glance

HHLA achieves positive result in a challenging year

EBIT impacted by pandemic-related strains and provision for efficiency programme

Major achievements

FY 2020

  • HHLA kept stable financial position despite restrictions due to coronavirus pandemic

  • Health & safety of employees maintained; kept production running

  • Acquisition of a majority share in a multi-function terminal at the Port of Trieste

  • Acquisition of 80.0 % stake in automation specialist iSAM AG

Throughput

6,776k TEU

‒ 10.6 %

Transport

1,536k TEU

‒ 1.9 %

Market environment

  • While H1 was affected by pandemic-related blank sailings and drop in volumes, the sector struggled with imbalances in trade flows in H2, resulting from a lack of empty containers and shipping space due to catch-up effects esp. in Asia

    Revenue

    € 1,269.3 m

    ‒ 6.0 %

    EBIT

    € 110.3 m

    ‒ 46.0 %

  • Both led to delays in sailing schedules that put high pressure on terminals and hinterland transport systems

Results

  • Container throughput impacted by pandemic-related downturn and changes in market share while container transport was only slightly down

    EBIT margin

    8.7 %

    ‒ 6.4 pp

    Profit after tax and minorities

    € 35.3 m

    ‒ 62.3 %

  • EBIT impacted by revenue decrease and provision of ~ € 43 million set aside in Q4 for an efficiency programme in the Container segment

  • Dividend proposal of € 0.45 per class A share in form of a scrip dividend

ROCE

5.8 %

‒ 5.3 pp

Operating cash flow

€ 271.4 m

‒ 10.4 %

Strong volume decline burdens revenue development while EBIT impacted by net provisions for an efficiency programme

Container throughput in thousand TEU

1,847 1,691

7,577 6,776

4Q19

4Q20

2019

2020

OpEx in € million

165.6 192.4

658.5 672.1

Revenue in € million

194.2 189.1

799.7 737.5

4Q19

4Q20

2019

2020

4Q19

4Q20

2019

2020

-3.2

  • Strong decline in throughput due to pandemic-related downturn and loss of a Far East service

  • Revenue reduced as a result of lower volumes (Hamburg down 11.1 %; Internationals down 4.7 %)

  • Average revenue per TEU + 4.3 % y-o-y mainly attributable to

    advantageous modal split with high share of hinterland volumes temporary increase in storage fees due to longer dwell times as a result of pandemic-related trade flow imbalances and weather-related delays

  • OpEx up by 2.1 % (down 3.3 % adjusted for net provisions and subsidies of public authorities)

  • EBIT mainly impacted by net provisions of € 43 million in 4Q20 as result of the implementation of restructuring measures

4Q19

4Q20

2019

2020

Strong recovery of volumes in H2 led to only slight decline in revenues and kept EBIT margin at a sound level

Container transport in thousand TEU

1,565 1,536

381

407

4Q19

4Q20

2019

2020

OpEx in € million

95.9 102.1

387.7 388.5

Revenue in € million

486.9 476.8

4Q19

4Q20

2019

2020

EBIT and EBIT margin in € million

99.2

19.4%

20.2%

20.4%

18.5%

4Q20

4Q19

4Q20

2019

2020

25 March 2021

  • Decrease in transport volumes more pronounced for road transport than for rail transportation (− 5.2% vs. − 1.0%); slight increase in rail share of total transportation volume from 78.8% to 79.6%

  • Revenues slightly down by 2.1 % due to volume declines mainly in H1 that could not be completely offset by strong recovery in H2

  • Average revenue per TEU decreased as a result of disadvantageous mix of short and long haul distance cargo loads

  • EBIT dropped by 11.0 %

  • EBIT margin still at a favourable level of 18.5 %

4Q19

2019

2020

Revenue in € million

Revenues suffered from pandemic-related downturn while at-equity earnings remained comparatively robust

15.1

59.0

51.4

13.5

4Q19

4Q20

2019

2020

EBIT in € millionneg.

-0.3

2.5

-3.9

4Q19

4Q20

2019

2020

At-equity earnings in € million

3.4

4Q19

  • Revenue from consolidated companies decreased mainly due to

    • strong decline in vehicle logistics

    • significant fall in consulting activities

  • Expected revenue growth from new activities was held back by the pandemic

  • EBIT development was adversely impacted by temporary increases in start-up losses of new activities and pandemic-related decline in earnings of existing activities

  • At-equity earnings remained comparably robust with a positive result

  • modility GmbH, a booking portal for intermodal traffic, was initially consolidated in the fourth quarter of 2020

4Q20

2019

2020

in € million

Comfortable liquidity position to meet payment obligations at all times

Cash flow development in line with business development

Investments

Financial fund as of 01.01.

EBITDAWorking capital and other effects

DivestmentsChanges in short-term deposits

Financial fund

Dividend paid

Payments to minoritiesRedemption of lease liabilities

Short-term deposits

Redemption of (financial)

loansOthers effectsF/X effects

Financial fund as of 31.12.

Attractive dividend proposal per class A share

HHLA confirms its payout corridor of 50 to 70 %

Dividend development in € / payout ratio in %

65

66

70 %

2017

Dividend development

  • Scrip dividend of 45 cents per class A share (option to choose cash or scrip dividend)

  • For determination, result was adjusted by the change in the restructuring provision affecting net income in the amount of € 43 million

  • Payout ratio at the lower end of the payout corridor of 50 to 70 % of the annual net profit after non-controlling interests

2016

2018

2019

2020

Earnings per share Dividend

Payout ratio Payout corridor

2020: Dividend proposal, EPS adjusted by changes in net provision

Performance

Effective match of technological and sustainable innovation

Various examples of efforts to implement our sustainability strategy

Reduction of specific CO2 emissions

Climate &energy

42.8%

against base year 2008

HHLA wants to have cut its total CO2 emissions at least in half by 2030 against 2018, and be climate-neutral by 2040

Area use

12

block storages have been put intoof 22 operation at CTB

More area efficiency by using the storage crane systems since lanes are no longer needed for van carriers and containers can be stacked up higher

Effective concepts for

Covid-19

Health & Safety

Health and safety of employees was maintained while neither introducing short-time working nor cutting wages

Climate-neutral

by

2040

Whisper brakes

Intermodal

Almost all of approx. 3,000 con-tainer wagons have been fitted with brakes which reduce the driving

and braking noise by half

Supplier

Code of Conduct

launched in 2020 and enshrined in the purchasing guidelines incl. anti-corruption regulations

Guidance 2021

Guidance 2021

Still high unpredictability regarding intensity and timing of economic recovery

Research estimates for 2021

GDP development

World China Russia CEE World trade

Throughput development

  • + 5.5 %

  • + 8.1 %

  • + 3.0 %

  • + 4.0 %

  • + 8.1 %World China Europe NW Europe Scan. & Baltics

Sources: IMF, January 2021 // Drewry Maritime Research, December 2020

+ 8.9 % + 9.0 % + 7.7 % + 8.1 % + 10.5 %

Constraints of guidance 2021

The forecast for the year is subject to considerable uncertainty. This applies in particular to the intensity and timing of the economic recovery.

Guidance for the Port Logistics subgroup 2021

2020

Guidance for 2021

Container throughput

6,776 k TEU

Moderate increase

Container transport

1,536 k TEU

Moderate increase

Revenue

€ 1,269.3 m

Moderate increase

EBIT

€ 110.3 m

in the range of € 140 to 165 million

Capital expenditure

€ 178.7 m

in the range of € 220 to 250 million

Liquidity

€ 201.3 m

sufficient to meet payment obligations at all times

Dividend per A class share

€ 0.45

commitment to pay out 50 to 70 % of net profit after minority interests

Level of intensity: slight < moderate < significant < strong

Several developments driving HHLA's transformation process

Advanced momentum through implementation of an efficiency programme in the Container segment

Structural sector developments

  • 01 Ship size development

    Increasing number of mega carriers demands

    more efficiency and operational flexibility as

    well as investments

    04 Overcapacity in the North Range

    Pressure on pricing due to fierce competition

  • Consolidation of shipping liners 05

02

Formation of alliances leads to increased price and performance pressure

03 Increasing degree of automation 06

Share of highly automated systems such as CTA

is steadily increasing

Cooperation of port authorities

Consolidation of the port authorities in France, Belgium and the Netherlands to enhance efficiency

Dedicated terminals prevailed

Many shipping lines have established stakes in terminals, putting HHLA multi-user approach under pressure

Hamburg-specific topics

07

Nautical restrictions almost solved 08

Elbe dredging already completed; full approval anticipated for H2/2021

Infrastructure maintenance

Ongoing infrastructure maintenance and projects, i.e. replacement of Köhlbrandbrücke, are on track

HHLA's response:targets of the efficiency programme

Lean and sustainable organisational structureImproved productivity in line with customer expectationsExpansion for mega carriers > 24,000 TEU

Laying groundwork for regaining market shareReduction of emissions and energy consumption

Further automation at Hamburg terminals will lead to increased performance

… and support medium-term profitability target of the Port Logistic subgroup

2020

2021

2022

2023

2024

2025

Operational measures

  • Roll-out of N4 terminal software on all terminals by end of 2022

  • Stepwise expansion of automatic block storages at CTB from 12 in 2020 to 22 in 2024

  • Construction of an AGV service centre and testing field at CTB by 2023

  • Replacement of straddle carriers by Automated Guided Vehicles (AGVs) at CTB from 2024 onwards

Personnel measures

  • Net provision of € 43 million earmarked for socially responsible personnel measures - Main instrument: early retirement programme will have a positive P&L effect from 2023 onwards - Further instruments: flexi-time, reduction of overtime, education & training and re-qualification

2025 targets of the

Port Logistics subgroup

EBIT 2025

€ 300 m

Capex 2021-2025

€ 1,050 m

Focus on three profit sources to fuel our future success

Rationale for 2025

Container

Intermodal

Logistics

  • Increase efficiency at Hamburg terminals by further automation

    • - Further area optimisation by taking up to 22 block storages into operation at CTB

    • - Automation of horizontal transport from the quayside to yard via AGV

    -

    Further optimisation of the existing systems by using intelligent system control

  • Growing EBIT contribution from international terminals

    Striving for efficiency

  • Expansion of rail terminals and hubs, i.e. Zalaegerszeg (Hungary)

  • Expansion of hinterland rail network in Central and Eastern Europe by increasing frequency on existing connections and adding new connections, particularly in Southern and South-Eastern Europe

  • Taking advantage of EU green deal

Growing EBIT contribution

  • Moderate increase expected from at-equity earnings

  • Strong top-line growth from new ventures anticipated from 2021 onwards

  • Positive EBIT contribution from new ventures expected for 2023 onwards

  • Clear commitment to invest in new technologies along future transport streams

    Positioned for growth

Q&A

Contact

Financial calendar and contact

Financial calendar 2021

.

25 March 2021

12 August 2021

Annual Report 2020 Analyst conference call

Half-year Financial Report Analyst conference call

12 May 2021

11 November 2021

Interim Statement Analyst conference call

Interim Statement Analyst conference call

10 June 2021

Virtual Annual General MeetingJulia Hartmann // Head of IR Phone: +49 40 3088 3397 E-mail:hartmann-j@hhla.de

Steffen Keim // Manager

Phone: E-mail:

+49 40 3088 3100keim@hhla.de

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Disclaimer

HHLA - Hamburger Hafen und Logistik AG published this content on 23 March 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 March 2021 09:40:05 UTC.