HHLA Reports Strong Growth Due to Increase in Intermodal Rail Transport

The Hamburg Port and Logistics AG (HHLA) recorded a positive business development in the first half of 2021, despite the ongoing impacts of the coronavirus pandemic and the resulting imbalances in global transport flows. The group’s operating result (EBIT) rose by 63.2 percent compared to the previous year to €90.5 million.

(Hamburg) High storage revenues due to ongoing ship delays in the Port of Hamburg and a strong increase in container transport volumes contributed to the positive business development. While container transports saw a strong increase of 16.0 percent, container throughput rose slightly by 0.7 percent compared to the previous year. The real estate sub-group saw a slight increase in revenue and a significant increase in results. Overall, group revenue increased by 12.8 percent to €709.2 million.

Angela Titzrath, Chairwoman of the Executive Board of HHLA: “Global supply chains have been disrupted due to the Corona pandemic and individual events such as the recent blockage in the Suez Canal. The result is massive ship delays that we, as terminal operators, must prepare for. However, we are aware of our responsibility for the stable supply of consumers and businesses in Germany and Europe. Therefore, we are making great efforts to ensure reliable processing at our facilities and a quick onward transport of containers. That we have managed to achieve a positive business result again in the first half of 2021 despite the challenging conditions is a testament to the strength of HHLA and its ability to successfully adapt to current challenges.”

Sub-group Port Logistics

The publicly listed sub-group Port Logistics recorded a strong revenue increase of 13.2 percent in the first six months to €695.1 million (previous year: €614.2 million). The operating result (EBIT) rose by 70.4 percent compared to the previous year, which was heavily impacted by the pandemic, to €83.8 million (previous year: €49.1 million). The EBIT margin increased by 4.0 percentage points to 12.0 percent.

Container

In the container segment, the throughput volume at the HHLA container terminals increased slightly by 0.7 percent to 3,369 thousand standard containers (TEU) (previous year: 3,345 thousand TEU). At the three Hamburg container terminals, the throughput volume was 3,073 thousand TEU, which is 0.5 percent above the previous year’s figure (previous year: 3,058 thousand TEU). This was primarily due to a moderate increase in cargo volumes with the Far East, which compensated for the pandemic-related volume declines in the previous year and the loss of a Far East service in May 2020. The feeder services, especially in the Baltic Sea region, developed moderately downward. The international container terminals in Odessa and Tallinn recorded a throughput volume increase of 3.4 percent to 296 thousand TEU (previous year: 286 thousand TEU). At the container terminal in Trieste, only RoRo ships were processed in the first six months of 2021, with no container ships yet handled.

Revenue increased in the first half of 2021 compared to 2020 by 11.4 percent to €404.9 million (previous year: €363.4 million). The slight volume increase of 0.7 percent was significantly surpassed by the increase in revenue quality. Average revenues per water-side handled container rose by 10.6 percent compared to the previous year. This was due to a favorable modal split with a high proportion of hinterland volume and a temporary increase in storage revenues due to ongoing ship delays. In addition to pandemic-related delays in ship departures, the blockage of the Suez Canal in March contributed to longer dwell times, leading to an increase in storage revenue. The operating result (EBIT) increased by 72.1 percent to €63.4 million (previous year: €36.8 million). The EBIT margin rose by 5.5 percentage points to a normalized level of 15.6 percent.

Intermodal

In the intermodal segment, container transport increased significantly by 16.0 percent to 832 thousand TEU (previous year: 718 thousand TEU). Rail transport particularly benefited from the recovery in cargo volumes that began in the second half of 2020. Thus, rail transport increased by an impressive 19.3 percent compared to the previous year to 678 thousand TEU (previous year: 568 thousand TEU), with the increase in the second quarter further amplified by the weak previous year’s quarter due to the pandemic. The volume growth achieved in the first half of the year was broadly diversified. In road transport, a moderate growth in transport volume of 3.4 percent to 155 thousand TEU was achieved in a persistently difficult market environment (previous year: 149 thousand TEU).

Revenue was €252.9 million, which is 13.3 percent above the previous year’s figure (previous year: €223.2 million). However, the increase lagged behind the development of transport volume. Despite the favorable increase in the rail share of total HHLA intermodal transport from 79.2 percent to 81.4 percent, average revenues per TEU decreased due to a changed structure of cargo flows. Against the backdrop of positive volume and revenue development, the operating result (EBIT) in the reporting period increased by 33.4 percent to €46.0 million (previous year: €34.5 million).

Sub-group Real Estate

The HHLA real estate in the historic warehouse district and on the fish market area developed positively with nearly full occupancy in the first six months of 2021.

Revenue increased slightly by 1.9 percent to €18.4 million (previous year: €18.0 million) during the reporting period. In addition to reactivated revenue lease agreements, partial waivers of granted rent deferrals due to the Covid-19 crisis in the previous year were primarily responsible for this. The cumulative operating result (EBIT) increased by 7.1 percent to €6.6 million (previous year: €6.1 million) with an almost constant maintenance volume.

Outlook for 2021 Partially Raised

The economic development of HHLA in the first half of 2021 largely met expectations. However, the expectations for container transport and revenues in the Port Logistics sub-group and the group have been raised.

For the Port Logistics sub-group, a moderate increase in container throughput is expected compared to the previous year, as well as a significant increase in container transport (previously: moderate increase). In terms of revenue, a significant increase on an annual basis is expected in light of the positive development in the first half of 2021 (previously: moderate increase). The EBIT expectation in the Port Logistics sub-group remains in the range of €140 to €165 million.

For the Real Estate sub-group, a slight revenue increase compared to the previous year’s figure is still considered possible, as well as an operating result (EBIT) at the level of the previous year.

At the group level, a significant revenue increase is now expected (previously: moderate increase), as well as an unchanged operating result (EBIT) in the range of €153 to €178 million.

Photo: © HHLA