3. Make-up of the Group

Consolidated companies

The group of consolidated companies at HHLA comprises a total of 35 domestic and 23 foreign companies. For a complete list of equity investments in accordance with Section 313 (2) HGB, see also Note 48. Information required under IFRS 12.10 and IFRS 12.21 is included here.

Subsidiaries

The Consolidated Financial Statements comprise the financial statements for Hamburger Hafen und Logistik Aktiengesellschaft (HHLA) and its significant subsidiaries. Subsidiaries are companies controlled by the Group. The Group is deemed to control a company if it has a risk exposure or right to fluctuating returns resulting from its involvement in the investee and if it can also use its power over the investee to affect these returns. In particular, HHLA controls an investee if – and only if – all of the characteristics listed in IFRS 10.7 apply. Subsidiaries’ financial statements are included in the Consolidated Financial Statements from the time control begins until the time control ends.

Interests in joint ventures

The Group holds interests in joint ventures. As per IFRS 11, a joint venture is subject to a joint contractual agreement between two or more parties to carry out an economic activity which is subject to joint control. Joint control is the contractually agreed division of managerial responsibilities for this arrangement. It only exists if the decisions associated with this business activity require the unanimous consent of the parties involved in joint management.

The HHLA Group holds more than half of the voting rights in the companies HHLA Frucht- und Kühl-Zentrum GmbH, Ulrich Stein Gesellschaft mit beschränkter Haftung and HVVC Hamburg Vessel Coordination Center GmbH yet has no controlling influence as the companies are effectively jointly managed. This is due in principle to the equal representation of the essential corporate bodies (shareholders’ meeting, supervisory board and/or management).

No unrecorded losses relating to joint ventures were incurred either in the reporting year or on a cumulative basis.

Interests in associated companies

Companies designated as associated companies are those over which the shareholder has a material influence. At the same time, it is neither a subsidiary nor an interest in a joint venture. A material influence is assumed when it is possible to be involved in the associated company’s financial and commercial decisions without exercising a controlling influence. This is generally the case when 20 to 50 % of the voting rights are held, either directly or indirectly.

HHLA does not provide information on associated companies as per IFRS 12 because the relevant companies are of minor importance overall for the Group. HHLA does not believe that this has a negative impact on the statement concerning the nature of interests in other companies and the associated risks. The effects of these interests on the results of operations, net assets and financial position of the HHLA Group are insignificant.

Accounting for interests in joint ventures and associates

Interests in joint ventures and associates are accounted for using the equity method. With the equity method, the share in each joint venture and/or associated company is first stated at acquisition cost. Instead of being amortised, any goodwill recognised within the carrying amount of the investment when it is reported in the balance sheet for the first time is subject to an impairment test for the entire carrying amount of the investment if there are any indications of possible impairment.

As from the acquisition date, HHLA’s interest in the results of the joint venture or associated company is recorded in the consolidated income statement, while its interest in changes in equity is recorded directly in equity. These cumulative changes affect the carrying amount of the interest in the joint venture or associated company. As soon as HHLA’s share in the company’s losses exceeds the carrying amount of the investment, however, HHLA records no further shares in the losses unless HHLA has entered into obligations to that effect or has made payments for the joint venture or associated company.

Significant results from transactions between HHLA and the joint venture or associated company are eliminated in proportion to the interest in the company.

Acquisitions, disposals and other changes to the consolidated group

On 28 September 2020, HHLA International GmbH, Hamburg, signed a shareholding and partnership agreement for the acquisition of 50.01 % of shares in Piattaforma Logistica Trieste S.r.l., Trieste, Italy (PLT). The object of the company is the planning, construction, maintenance and management of the logistics platform between Scalo Legnami and the former Italsider steelworks in the port centre of Trieste. Among other things, this includes conducting operations as a port company, storing materials and goods on behalf of third parties and the promotion, organisation, management and marketing of all services in connection with the exchange of goods, particularly intermodal exchange by ship, train and overland transport and the use of terminals that are equipped for goods transport and logistics of all kinds. The closing of the transaction (corresponding to the acquisition date) was tied to various closing conditions and took place on 7 January 2021. On the same date, the company was renamed HHLA PLT Italy S.r.l. The first-time consolidation of the company took place on the acquisition date. The company was therefore fully consolidated for the first time on 31 March 2021. The purchase price (transferred consideration) was paid in euros.

A capital increase in the amount of € 12,008 thousand was carried out in connection with the acquisition of the shares. The agreements also include various options for both the purchaser and the seller, some of which are mutually dependent. For HHLA PLT Italy S.r.l., various options exist in the medium term to expand the existing infrastructure. HHLA therefore has the opportunity to successively increase its interest by acquiring the shares of former shareholders in conjunction with further capital increases. If these options to expand are not utilised, the former shareholders have the option of selling their remaining shares for € 21,000 thousand to HHLA or maintaining the status quo. As it cannot be ruled out that the former shareholders will exercise the option to sell, a discounted financial liability was recognised directly in equity as part of the first-time consolidation. Utilisation of the options to expand and therefore their occurrence are subject to the approval of HHLA’s Supervisory Board.

The following tables depict the consideration transferred for the acquisition of the company and the values of the assets identified, and liabilities acquired, on the date of acquisition based on the acquisition of 50.01 % of the shares:

The derived goodwill in the amount of € 8,487 thousand based on the acquisition of 50.01 % of the shares reflects the future development of the newly built terminal, as well as the existing general cargo activities and the associated establishment and expansion of customer relations. Besides participating in the growth of activities, HHLA has the prospect of further expanding its rail operations in the Intermodal segment in the Mediterranean and offering customers holistic transport solutions. The goodwill has been allocated to the Container segment. It is not anticipated that a portion of the recorded goodwill will be tax deductible.

The acquired customer relations in the amount of € 871 thousand relate to general cargo.

The fair value of trade receivables amounts to € 1,688 thousand and is collectable in full.

The proportionate net assets of the non-controlling interests recognised in the course of the business combination amount to € 3,015 thousand based on the acquisition of 50.01 % of the shares. This valuation is based on the same criteria that were used to value the acquired assets and liabilities.

Between 1 January and 31 December 2021, the acquired business operations contributed to the HHLA Group’s result with revenue of € 8,842 thousand and start-up losses of € 6,114 thousand.

With the shareholding and partnership agreement of 16 December 2020, HHLA AG acquired 80.0 % of shares in iSAM AG, Mülheim an der Ruhr, and its subsidiaries. The object of the company is the development and distribution of IT software and the distribution of IT hardware; consultancy on the development of internal IT concepts, the design and implementation of system solutions, as well as consultancy, development and production with regard to automation concepts in manufacturing, trading and service companies. The closing of the transaction (corresponding to the acquisition date) was tied to various closing conditions and took place on 19 January 2021. The first-time consolidation of the companies took place on the acquisition date. The companies were therefore fully consolidated for the first time on 31 March 2021.

In the event that existing shareholders wish to sell shares in the company, HHLA has a pre-emptive and co-sale right.

The following table depicts the values of the assets identified, and liabilities acquired, on the date of acquisition:

The derived goodwill in the amount of € 6,458 thousand reflects the opportunity to participate in the future development of the Group and the leveraging of synergies for HHLA’s own operations (process optimisations in the area of container handling, strengthening customer loyalty, cross-selling potential). The goodwill has been allocated to the Logistics segment. It is not anticipated that a portion of the recorded goodwill will be tax deductible.

The acquired technologies in the amount of € 1,791 thousand reflect the software solutions developed and marketed by the company to automate process chains in a variety of industries (steel, transport and logistics, and aviation).

Customer relations exist with big-name companies in the logistics, commodities, mining and aviation industries. Thanks to the company’s long history stretching back to 1983, the software solutions sold under the iSAM brand since 2002 together with the corresponding hardware solutions for the automation of process chains are well known in the relevant industries.

Subject to a preliminary assessment pursuant to Section 8c (1) sentence 7 of the German Corporation Tax Act (KStG), it is possible to recognise loss carryforwards that can be used for tax purposes.

The fair value of trade receivables amounts to € 750 thousand and is collectable in full.

The fair value of non-controlling interests recorded during the company acquisition stands at € 1,986 thousand. This valuation is based on the same criteria that were used to value the acquired assets and liabilities.

Between 1 January and 31 December 2021, the acquired business operations contributed to the HHLA Group’s result with revenue of € 9,486 thousand and a profit of € 1,376 thousand.

With the partnership agreement of 14 December 2020, HHLA AG set up the company HHLA Digital NeXt GmbH, based in Hamburg. The shareholders passed a resolution on 6 August 2021 to change the name of the company to HHLA Digital Next GmbH. The company’s objective is the development, spinning off, shareholding or acquisition, maintenance, administration and disposal of companies or participating interests in the fields of transport and logistics, particularly start-ups from the trade and transport tech sector. Its inclusion in the HHLA group of consolidated companies took place on 31 December 2021 as a fully consolidated subsidiary. The company was assigned to the Logistics segment.

With the partnership agreement of 16 December 2021, METRANS a.s., Prague, Czech Republic, founded the company METRANS Zalaegerszeg Kft., based in Budapest, Hungary. The company’s objective is the acquisition of a plot of land. Its inclusion in the HHLA group of consolidated companies took place on 31 December 2021 as a fully consolidated subsidiary. The company was assigned to the Intermodal segment.

With the share purchase and transfer agreement dated 16 December 2021, METRANS a.s., Prague, Czech Republic, acquired 100 % of the shares in CL EUROPORT s.r.o., based in Plzen, Czech Republic. The company holds 79.2 % of the shares in CL EUROPORT Sp. z o.o., based in Malaszewicze, Poland. The closing of the transaction (corresponding to the acquisition date) is tied to various closing conditions and took place on 4 January 2022, after the balance sheet date. The first-time consolidation of the company took place on the acquisition date. The purchase price (transferred consideration) was paid in euros.

With the share purchase and transfer agreement dated 16 December 2021, METRANS a.s., Prague, Czech Republic, acquired 20.8 % of the shares in CL EUROPORT Sp. z o.o., based in Malaszewicze, Poland. As a result of this transaction and the one mentioned above, METRANS a.s acquired 100 % of the shares in CL EUROPORT Sp. z o.o. The company’s purpose is to operate a container terminal offering intermodal services relating to the handling of container trains, road transport and container storage. The closing of the transaction (corresponding to the acquisition date) is tied to various closing conditions and took place on 4 January 2022, after the balance sheet date. The first-time consolidation of the company took place on the acquisition date. The purchase price (transferred consideration) was paid in euros.

The following tables depict the consideration transferred for the acquisition of the company and the values of the assets identified, and liabilities acquired, on the date of acquisition based on the acquisition of 100 % of the shares:

The following table depicts the values of the assets identified, and liabilities acquired, on the date of acquisition:

The fair values of the acquired assets and assumed liabilities have only been determined on a provisional basis. The final measurement has yet to be completed and may lead to changes in the fair values of the assets and liabilities. This would result in a change in goodwill.

The preliminary derived goodwill in the amount of € 4,758 thousand reflects the opportunities for a further expansion and therefore the future development of the container terminal as well as the leveraging of synergies and new entry points for the METRANS Group’s existing network. The goodwill has been allocated to the Intermodal segment, to the cash-generating unit METRANS. It is not anticipated that a portion of the recorded goodwill will be tax deductible.

The fair value of trade receivables amounts to € 523 thousand and is collectable in full.

There were no other significant acquisitions, purchases or disposals of shares in subsidiaries, or changes to the group of consolidated companies.