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Challenging environment puts a strain on HHLA’s start to fiscal year 2020

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4 years ago

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Challenging environment puts a strain on HHLA's start to fiscal year 2020. Image: HHLA
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Changed general conditions had an impact on both the sales and the results of Hamburger Hafen und Logistik AG (HHLA) in the first three months. The company recorded a moderately falling turnover and a strongly declining result with a corresponding impact on profitability. Due to storm situations in Northern Europe and the first signs of weakening trade due to the spreading coronavirus pandemic, container throughput fell moderately and container transport fell significantly. The real estate segment, on the other hand, was once again able to achieve higher sales and earnings. In total, this led to consolidated sales of EUR 335.7 million (- 3.4 percent). The operating result (EBIT) decreased by EUR 23.0 million or 38.6 percent to EUR 36.7 million.

Angela Titzrath, HHLA CEO: “Our expectations for the current financial year were characterized by confidence, knowing well that the general conditions for our business have been changing for some time due to a variety of influences. However, the impact of spring storm lows and the rapidly progressing coronavirus pandemic have also left their mark on our numbers. We have to be prepared for a situation that has never existed in the company’s history and that we cannot influence. 2020 will therefore be one of the most challenging in HHLA’s history. With our experience, however, we will find ways out of the crisis and continue to successfully develop HHLA. ”

Port Logistics subgroup: Business development January – March 2020

The listed Port Logistics subgroup recorded a moderate 3.7 percent drop in sales to EUR 327.4 million in the first three months (previous year: EUR 339.8 million). The operating result (EBIT) fell sharply by 41.7 percent to EUR 32.5 million (previous year: EUR 55.7 million). The EBIT margin decreased by 6.5 percentage points to 9.9 percent.

In the Container segment , the volume handled at HHLA container terminals fell by 3.7 percent overall to 1,796 thousand standard containers (TEU) (previous year: 1,865 thousand TEU).

At 1,652 thousand TEU, the handling volume at the three container terminals in Hamburg was 4.1 percent below the comparative value of the previous year (previous year: 1,722 thousand TEU).

Ship delays due to storm lows across Northern Europe and blank sailing as a result of the spreading coronavirus pandemic led to a moderate decrease in cargo volumes from the Far East. The international container terminals in Odessa and Tallinn with a handling volume of 144 thousand TEU were at the previous year’s level (previous year: 143 thousand TEU).

Revenue decreased in the first quarter of 2020 compared to 2019 by 2.6 percent to EUR 195.6 million (previous year: EUR 200.9 million). This resulted primarily from the pandemic-induced drop in volumes. Average revenues per container handled on the water side increased by 1.1 percent compared to the same period in the previous year. The reason for this was an advantageous modal split with a high proportion of hinterland quantities as well as a temporary increase in storage funds due to a longer stay as a result of weather-related delays. The operating result (EBIT) decreased by EUR 12.0 million or 31.7 percent year-on-year to EUR 25.8 million (previous year: EUR 37.8 million). The EBIT margin fell by 5.6 percentage points to 13.2 percent.

In the intermodal segmentContainer transport decreased by 5.1 percent to 378 thousand TEU (previous year: 398 thousand TEU). The decline in road transport was significantly more pronounced than in rail transport. The latter decreased by 3.3 percent compared to the previous year to 300 thousand TEU (previous year: 310 thousand TEU).

While the traffic from both the North German and sea ports on the Adriatic posted significant declines, strong growth in continental traffic compensated for part of the decline in the maritime sector. Road transport continued to decline in the previous quarters. In particular due to the weak development in the Hamburg area, the transport volume in a persistently difficult market environment decreased by 11.4 percent year-on-year to 78 thousand TEU (previous year: 88 thousand TEU). At EUR 116.8 million, sales were 5.8 percent significantly lower than in the previous year (previous year: EUR 123.9 million) and were thus somewhat more pronounced than the transport volume. Despite a slight increase in the share of rail in the total volume of HHLA intermodal transports from 77.9 percent to 79.4 percent, the average sales per TEU decreased due to a disproportionate decrease in cargo flows with longer transport distances.

The operating result (EBIT) decreased by 31.9 percent to EUR 17.2 million in the reporting period (previous year: EUR 25.3 million).  In addition to the declining volume and sales development, the reason for this sharp decline is also increased fluctuations in the volume of import and export loads and the associated decrease in the utilization of the train systems. EUR 5.8 percent significantly below the previous year’s figure (previous year: EUR 123.9 million) and were therefore slightly more declining than the transport volume.

Port Logistics subgroup: Outlook for the whole of 2020

The coronavirus pandemic, which is now spreading worldwide, has prompted state bodies and authorities in almost all affected countries to impose measures to curb virus spreading to an unprecedented extent.

The main aim of the measures is to reduce social contacts between people. Both at national level and in international traffic, this leads to a contraction in economic activity, the depth and length of which cannot be reliably estimated. The contraction covers all areas of the economy and thus also international trade, which is important for HHLA.

A forecast is not reliably possible under the current general conditions, but it can be assumed that sales and operating profit (EBIT) in the Port Logistics subgroup will be significantly below the previous year. The primary cause for this are possible, at least temporarily, strong declines in container handling and transportation.

Real estate subgroup: business development January – March 2020 and outlook

HHLA real estate in the historic warehouse district and on the fish market area in Hamburg recorded stable sales development in a declining market environment. Revenues based on the fact that most of the two quarters were fully let in the previous year rose again moderately by 4.0 percent year-on-year to EUR 10.1 million (previous year: EUR 9.8 million). The cumulative operating result (EBIT) rose by 6.0 percent to EUR 4.1 million (previous year: EUR 3.9 million) due to revenue growth in both quarters with a constant maintenance volume.

The operating profit (EBIT) of the Real Estate subgroup is considered to be a result significantly below the previous year.

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Maritime

The Port of Valencia begins electrification of its docks

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9 months ago

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August 11, 2023

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The Port of Valencia begins electrification of its docks. Image: Port Authority of Valencia
The Port of Valencia begins electrification of its docks. Image: Port Authority of Valencia
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A new step in the decarbonisation of the Port of Valencia and its firm commitment to be an emission neutral site by 2030. The Port Authority of Valencia (APV) has put out to tender the drafting and execution of the works for the electrical connection to ships for the Transversal Costa-MSC quay. This is the first electrification or Onshore Power Supply (OPS) project to be carried out by Valenciaport in the Valencian precinct.

The APV is thus initiating the procedure for the award of the contract for the drafting and execution of the project for the installation of electrical connections for ships and the maintenance of the same at the Transversal de Costa quay. To this end, Valenciaport has jointly launched the drafting of the construction project, the execution of its works and the maintenance of the installations in the same procedure for an amount of 12,468,626.8 euros (VAT included).

Onshore Power Supply (OPS) electrification infrastructures have been consolidated as a very useful tool for the decarbonisation of ports, as this system avoids the use of auxiliary engines of ships when they are docked in the enclosures. This reduces greenhouse gas emissions – due to the use of electricity that eliminates the consumption of fossil fuels used in these auxiliary engines – and stops the emission of particles and polluting gases.

This OPS initiative in the Port of Valencia will be carried out in parallel with the works on the new electrical substation – a second substation is also planned – which was put out to tender last month with a base budget of around 11 million euros and a completion period of 24 months. This infrastructure will be responsible for supplying green energy to the first OPS electrification project of the Transversal de Costa-MSC quay.

In this regard, Joan Calabuig, president of Valenciaport, stressed that “these are just two examples of real projects in the execution phase that confirm the firm commitment that Valenciaport is making to achieve the goal of being a zero-emissions port by 2030, twenty years ahead of the European Green Pact. It is a commitment to sustainability and to the society of our environment that is supported by initiatives such as the electrification of the docks, the use of hydrogen in port operations, the installation of photovoltaic plants or the commitment to intermodality with the railway. We are committed to sustainable growth that reinforces our position as a port of reference in the Mediterranean”.

Project included in the Next Generation Funds

The joint contracting of the preparation of the project and the execution of the corresponding works in the same procedure is carried out in response to the fact that there are no references in Europe compatible with the ISO/IEC/IEEE 80005 standard and in Spain there is currently no previous experience of OPS projects in operation with the characteristics of the pilot project defined by the Port Authority of Valencia. The combination of the individual components required for this type of installation (transformers, protection cells, disconnectors, frequency converters, etc.) with infrastructures for supplying electricity to ships requires specific projects, with technically complex solutions that have to be designed specifically for each location. In addition, and given that the execution of the construction project is subsidised by the European Union’s Next Generation funds and the Spanish Government’s Recovery, Transformation and Resilience Plan, the joint tender is the only way to meet the established deadlines, since if two separate contracts were launched, the one for the execution of the construction project could not be launched until the one for the drafting of the construction project had been awarded, which would mean that the work would be completed beyond the deadline for the execution of the works to meet the target set by Europe.

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Environment

MOL joins GCMD as impact partner to accelerate decarbonisation

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9 months ago

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August 9, 2023

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MOL joins GCMD as impact partner to accelerate decarbonisation. Image: Pixabay
MOL joins GCMD as impact partner to accelerate decarbonisation. Image: Pixabay
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The Global Centre for Maritime Decarbonisation GCMD and MOL announced the signing of a five-year Impact Partnership agreement. On the same day, both parties held a signing ceremony at the GCMD office in Singapore.

Decarbonisation in the maritime industry is a challenge that needs to be achieved through accelerating collaboration and increasing investment by shipping companies, their customers, ports, energy suppliers and public sector actors. As an Impact Partner of GCMD, MOL will utilise its expertise developed over their long history and make various contributions and collaborations through its participation in GCMD’s projects, including providing access to vessels, operating data and evaluation reports so that internal learnings can be shared publicly and used for future trials.

MOL is one of the world’s leaders in the maritime industry and has been leading worldwide discussions on achieving decarbonisation. The carbon budget concept imposes a ceiling to the cumulative amount of greenhouse gas (GHG) that can be emitted globally in order to limit global temperature rise to 1.5 degree Celsius by 2050. Intermediate targets to reduce emissions, in addition to a net-zero target, are necessary. While plans are in place to adopt low or zero emissions vessels in the future, it is important to deploy measures to reduce emissions now. Such measures include the use of low-carbon and transition fuels that are available today, and deploying energy savings devices onboard vessels. MOL will bring its extensive capabilities and experience to bear as it joins GCMD and existing partners to accelerate international shipping’s decarbonisation.

Professor Lynn Loo, CEO of the Global Centre for Maritime Decarbonisation, said: “We are proud to have MOL, one of the leading shipowners in Japan, come onboard as an Impact Partner. We are excited to tap on MOL’s track record in developing technical energy efficiency measures to broaden our perspective as we scope an initiative to help increase industry adoption of measures that can increase fuel efficiency of ships.”

Toshiaki Tanaka, Representative Director, Executive Vice President Executive Officer, and Chief Operating Officer of MOL, said: “We are very pleased to be a partner of one of the most important global coalitions. We will make our biggest effort to contribute and accelerate progress towards the net zero future in maritime industry, together with GCMD and all its partners.”

About the Global Centre for Maritime Decarbonisation

The Global Centre for Maritime Decarbonisation (GCMD) was set up on 1 August 2021 as a non-profit organisation. Our strategic partners include the Maritime and Port Authority of Singapore (MPA), BHP, BW Group, Eastern Pacific Shipping, Foundation Det Norske Veritas, Ocean Network Express, Seatrium, bp, Hapag-Lloyd and NYK. Beyond the strategic partners, GCMD has brought on board 15 partners that engage at the centre level, in addition to more than 80 partners that engage at the project level.

Strategically located in Singapore, the world’s largest bunkering hub and second largest container port, GCMD aims to help the industry eliminate GHG emissions by shaping standards for future fuels, piloting low-carbon solutions in an end-to-end manner under real-world operations conditions, financing first-of-a-kind projects, and fostering collaboration across sectors.

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Container Shipping Lines

Wan Hai Lines establishes its new office in India

Published

9 months ago

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August 9, 2023

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Wan Hai Lines establishes its new office in India. Image: Unsplash
Wan Hai Lines establishes its new office in India. Image: Unsplash
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Aiming to further enhance service quality and gain a stronger foothold in the Indian sub-continent, Wan Hai Lines has established its India new office in Kolkata in July 2023. Contact details for the new office are as follows: WAN HAI LINES (INDIA) PVT. LTD 3rd Floor, Block C, Apeejay House, 15 Park Street, Kolkata, West Bengal, 700016 TEL: 91-33-4450 4500 According to the 2023 Foreign Trade Policy announced by the Indian Ministry of Commerce and Industry, India’s export trade volume will reach 2 trillion US dollars in 2030.

Therefore, benefiting from government policy incentives and the shifting trend of the global supply chain, India’s status in global manufacturing and international trade is increasing, which is conducive to maintaining long-term high economic growth. And the proportion of global exports has increased significantly. In addition, the continuous economic stimulus policy will help revitalize the domestic economy, and domestic demand is expected to increase significantly. Therefore, Wan Hai is optimistic about India’s future import and export situation. And also through the establishment of a new office to improve the overall operating efficiency.

Wan Hai India Kolkata office held a grand opening reception in the evening of 27th July. During the banquet, there were many important customers & guests. The Kolkata Port Authority, Kolkata terminal operators, feeder operators and important local customers were invited to send representatives to attend the meeting to express their blessings to Wan Hai’s opening of the Kolkata market. At present, Wan Hai has six owned offices in India, namely Mumbai, Chennai, Mundra, and Vizag, Delhi and the sixth office Kolkata office. In addition to directly providing river port services, it will also simultaneously strengthen service links between India and neighboring countries, such as Nepal and Bhutan. It is expected to pursue customer first through continuous expansion in the future and sustainable business philosophy.

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