24.03.2017
Hapag-Lloyd AG DE000HLAG475
DGAP-News: Hapag-Lloyd AG: Hapag-Lloyd with positive operating result in a challenging environment
DGAP-News: Hapag-Lloyd AG / Key word(s): Final Results
Hapag-Lloyd AG: Hapag-Lloyd with positive operating result in a challenging
environment
24.03.2017 / 16:20
The issuer is solely responsible for the content of this announcement.
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Substantial earnings contribution from synergies from CSAV acquisition and
OCTAVE cost-cutting programme / Further synergies expected due to the merger
with UASC
Hapag-Lloyd closed the 2016 financial year with EBITDA of EUR 607.4 million
(previous year: EUR 831.0 million) and an operating result (EBIT) of EUR
126.4 million (previous year: EUR 366.4 million). These figures are taken
from the 2016 annual report, which was published today. The Group net result
came in at EUR -93.1 million (previous year: EUR 113.9 million).
"We had a very challenging market environment in the first six months of
2016, but were able to improve revenue and results significantly in the
second half of the year. Even though we performed relatively well in the
industry in 2016, the bottom line is still that this result is not
satisfactory," said Rolf Habben Jansen, Chief Executive Officer of
Hapag-Lloyd. "We expect some market improvement in 2017, but our success
will largely depend on our ability to achieve more sustainable freight
rates. Longer term, the lack of orders for new builds and the continued high
scrapping figures point to a better equilibrium between capacity supply and
demand," continued Habben Jansen.
In 2016, Hapag-Lloyd's transport volume rose by 2.7% year on year to 7.6
million TEU. The average freight rate was USD 1,036/TEU, which was 15.4%
lower than in the previous year (USD 1,225/TEU). Revenue fell from EUR 8.842
billion in the previous year to EUR 7.734 billion in 2016, mainly due to the
significant decline in rates.
In 2016, Hapag-Lloyd managed to reduce its transport expenses significantly
by 12.3% to EUR 6.364 billion (previous year: EUR 7.259 billion). However,
this reduction did not fully offset the decline in the average freight rate.
The noticeable improvements in transport expenses were due to the lower
average bunker price in 2016 of USD 210/tonne (previous year: USD 312/tonne)
as well as a 6.3% reduction (compared to 2015) in bunker consumption brought
about by the use of larger and more efficient ships. Despite an increase in
transport volume, Hapag-Lloyd successfully reduced the costs of purchased
services (e.g. hinterland container transport costs; chartering and leasing
costs; and port, canal and terminal costs) by 8.3% (compared to 2015). This
was primarily due to synergy effects achieved through the merger with CSAV
and the OCTAVE cost-cutting programme but also due to market driven cost
reductions (e.g. bunker) which will not necessarily be sustainable going
into 2017.
The beginning of 2017 is challenging. "Due to long term contracts we have
not yet been able to fully capture the recent positive rate development in
the spot market while bunker price has increased significantly. We will
continue to work hard to make Hapag-Lloyd even more competitive and to build
on our strong position. Our efforts will be supported by the expected
synergies and the further diversification of our product portfolio due to
the merger with UASC," explained Rolf Habben Jansen.
Based on forecasts for global trade growth (IMF: 3.8%) and global container
ship capacities, Hapag-Lloyd anticipates a moderate increase in the average
freight rate and transport volume in 2017 (excluding UASC). The preparations
for the closing of the merger with UASC are in their final stages. From 2019
onwards, the merger is expected to result in annual synergies of USD 435
million. This is offset by one-off expenses of around USD 150
million resulting from the transaction and the integration of UASC into
Hapag-Lloyd. Final synergy effects from the CSAV merger as well as positive
effects from the OCTAVE cost-cutting programme and the Compete to Win
project designed to improve revenue quality are also expected for 2017.
Under these circumstances, Hapag-Lloyd expects a better EBITDA and EBIT year
on year.
"The key areas of focus for us in 2017 will be the launch of our new
alliance as at 1 April and the rapid and seamless integration of UASC into
Hapag-Lloyd", said Rolf Habben Jansen.
With equity almost unchanged year on year at EUR 5.058 billion and an equity
ratio of 44.6% Hapag-Lloyd possesses a solid balance sheet. With liquidity
reserves of around EUR 760 million (including unused credit lines), the
Company is securely financed for the future (as at 31 December 2016).
About Hapag-Lloyd
With a fleet of 166 modern container ships and a total transport capacity of
963,000 TEU, Hapag-Lloyd is one of the world's leading liner shipping
companies. The Company has around 9,400 employees at 366 sites in 121
countries. Hapag-Lloyd has a container capacity of 1.6 million TEU -
including one of the largest and most modern fleets of reefer containers. A
total of 128 liner services worldwide ensure fast, reliable connections
between all the continents. Hapag-Lloyd is one of the leading operators in
the Transatlantic, Latin America and Intra-America trades.
Contact:
Henrik Schilling
Senior Director Investor Relations
Hapag-Lloyd AG
Ballindamm 25
20095 Hamburg
Phone +49 40 3001-2896
Fax +49 40 3001-72896
Mobile +49 152 0159-7743
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24.03.2017 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
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Archive at www.dgap.de
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Language: English
Company: Hapag-Lloyd AG
Ballindamm 25
20095 Hamburg
Germany
Phone: +49 (0) 40 3001 - 2896
Fax: +49 (0) 40 3001 - 72896
E-mail: [email protected]
Internet: www.hapag-lloyd.com
ISIN: DE000HLAG475, USD33048AA36
WKN: HLAG47, A1E8QB
Indices: SDAX
Listed: Regulated Market in Frankfurt (Prime Standard), Hamburg;
Regulated Unofficial Market in Berlin, Dusseldorf,
Hanover, Munich, Stuttgart, Tradegate Exchange
End of News DGAP News Service
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