Annual Report 2022

Risks and opportunities

1. Market environment

Developments in container throughput, transport volumes and logistics services

The pace of growth in those economies with flows of goods supplied by HHLA is a key precondition for the future development of container throughput, transport volumes and logistics services.

The various crises of 2022, and especially the war in Ukraine, led to repeated adjustments of forecasts for global GDP and global trade. The IMF currently expects global economic growth to weaken to an estimated 3.4 % for 2022 and 2.9 % for 2023. Due to ongoing global economic and political tensions, these figures are still subject to a degree of uncertainty.

The growth forecast for China – the most important shipping region for the Port of Hamburg – is below the global average at 3.0 % for 2022 with economic growth of 5.2 % forecast for 2023. The main reasons for this are China’s weaker real estate market, the effects of the current resurgence of Covid-19 following the end of China's zero-Covid strategy and the slower than expected recovery in consumer spending. Economic environment

The growth potential of Central and Eastern European economies such as Poland, the Czech Republic, Slovakia and Hungary, which use the Port of Hamburg for a significant proportion of their intercontinental trade, also offers opportunities for a stronger volume trend. Should the economic trend exceed expectations, prompting stronger volume growth, this could present an opportunity to profit from higher earnings by achieving economies of scale in handling and boosting volumes in downstream transport systems. However, this scenario is countered by the many challenges and uncertainties mentioned, which means that the likelihood of such opportunities arising during the coming year is low.

The market research institute Drewry is now forecasting negative growth of -0.5 % for global container throughput in 2022 and expects low growth of 0.8 % for 2023. These estimates are also subject to uncertainty due to the ongoing geopolitical tensions and the development of inflation rates. Although they remain relevant to HHLA, the associated volume and capa­city risks are still classified as unlikely for the time being. Outlook for the sector development

Throughput and transport volumes in the markets of relevance to HHLA are monitored closely to ensure trends are recognised at an early stage. Where scalable, controllable costs and investments – for example, relating to the further expansion of the container terminals – are adjusted in line with the foreseeable level of demand.

Competitive environment

The competitive environment on Europe’s northern coast is characterised by fragmentation on the one hand and the increasing influence of shipping companies on terminals on the other. Competition remains fierce. Reliability and a high degree of quayside productivity, coupled with attractive container services and competitive prices, are central to the active positioning of Hamburg’s container terminals. Clear objectives for increased productivity and improved operating costs have been defined as part of the gradual transformation processes that will be implemented one step at a time by 2025. Other factors affecting the competitive position of terminal operators are the geographical location of ports, the scope and quality of their hinterland links and their accessibility from the sea.

Price sensitivity of shipping company customers, particularly for overseas traffic and transshipment, is expected to increase during 2023 with weak growth in containerised global trade. This could lead to a shift in volumes to competitors.

The fierce competition for container transport by rail remains high as a result of various observable market trends, such as plans announced by shipping companies and logistics firms to establish their own transport routes. For HHLA’s Intermodal subsidiaries, the risk of volume being re-routed and revenue being lost is higher than in the previous year.

HHLA constantly improves its competitiveness by enhancing its service quality and operational capabilities. Its ship handling activities focus primarily on increasing the efficiency of its handling services and addressing the increasing number of peak loads prompted by the handling of container mega-ships. HHLA is working on innovating its systems and optimising processes to strengthen its position in handling technology.

In the Intermodal segment, the reliability and punctuality of train connections, the scalability of the shuttle system, the expansion of the terminal network and a competitive cost base remain key prerequisites for the expected growth of rail transportation. Investments in our own hub terminals and the expansion of the network through the construction or acquisition of further terminals (construction of another new hub terminal in Hungary, acquisition of a terminal in Malaszewicze in 2022) will strengthen the performance of HHLA’s hinterland network. Moreover, regulatory measures may increase the competitiveness of rail transportation in the intermodal marketplace.

Customer structure

As a result of fierce competition, HHLA remains exposed to risks and opportunities from temporary or structural shifts in services provided by shipping company customers between the North Range ports and in the Port of Hamburg. As volumes per service and ship call increase with the use of ever-larger vessels, the impact on capacity utilisation at seaport terminals also grows. The risks resulting from significant changes to the current service structure are lower than in the previous year but still remain possible.

In the field of ship handling, HHLA cooperates with many shipping companies on a neutral basis (“multi-user principle”). This enables HHLA to respond flexibly to changes in the container liner shipping sector. For CTT, the minority stake of CSPL – aimed at making Tollerort a preferred hub for COSCO traffic in Europe – may provide long-term planning and employment security. The German government has now approved the shareholding under specific conditions, primarily limiting the share of voting rights to 24.99 %. In addition, HHLA aims to enhance added value for its customers by expanding its mega-ship handling activities, continuing to develop the quality of its services and operational capabilities, and optimising client-specific processes.

Depending on the customer structure, smaller affiliates may become reliant on individual clients. Various steps are taken to counteract this reliance, such as optimising service quality. At the same time, efforts are made to attract new clients.

Energy price increases

Fossil fuels are exposed to procurement price risks owing to geopolitical factors and environmental policy targets. These risks can adversely affect the earnings of the energy-intensive Container and Intermodal segments. Even taking into account the electricity price cap initially agreed by the German government for 2023, the risk of rising energy prices remains material. The occurrence of this risk is still regarded as possible. Macroeconomic forecast

HHLA is therefore taking steps to increase energy efficiency and pursuing a strategically focused procurement policy that favours electricity from climate-neutral production. It will be necessary to pass on price rises to the market where possible.

Traction/track costs

HHLA companies operating in the Intermodal segment pay track fees to the national railway companies or network operators for their rail network usage and also purchase traction services.

As the rail infrastructure in Germany is largely publicly owned, various authorities monitor non-discriminatory access and track fees. These authorities include the Federal Network Agency and the Federal Railway Authority in Germany as well as corresponding bodies abroad at EU level. In 2021, the German government also decided to reduce track fees in order to facilitate a carrier-neutral allocation of infrastructure costs and achieve the political aim of a rail/road modal split of 25/75 % by 2030. The risk of increased traction/track costs therefore remains immaterial for HHLA. Risks and opportunities. 1. Market environment; 3. Other risk and opportunity factors; 6. Strategic environment

To reduce the level of dependency on national railway companies for traction services and to enhance production quality, HHLA is expanding its own facilities and rolling stock in line with demand. Providing end-to-end transport services using the company’s own operating assets guarantees high quality throughout the process chain. HHLA’s objective is to offer its customers a logistics chain of unparalleled quality and reliability. This will further strengthen Hamburg’s appeal: high-performance seaport terminals promote higher volumes in the hinterland, while intelligent transport systems with low-cost structures boost container flows at the port.

2. Financial risks

Impairment of investments

An economic trend that falls short of expectations may require adjustments to the valuation of assets. For example, the high level of fixed costs associated with large parts of HHLA’s business model means that it might not be possible to compensate fully for divergences in earnings caused by underutilised capacity in the short term if demand for HHLA’s services fails to materialise as expected. The terminal in Odessa is at risk due to the war in Ukraine. Our net assets, financial and earnings position may be affected. Material risks (expropriation, destruction, breach of contract) are largely hedged by German government guarantees. Changing interest rates, triggered by inflation and a more restrictive monetary policy, are tending to lower present values when performing impairment tests. HHLA regularly checks for any impairment of its assets and makes adjustments where necessary. As in the previous year, impairment risks indicate a medium level of damage, with the occurrence of the risk still regarded as possible.

Currency risks

As the bulk of HHLA’s services are rendered within the eurozone, the majority of its invoices are issued in euros. The Intermodal and Logistics segments operate internationally, and a container terminal is operated in Ukraine. Invoicing here is primarily in euros or dollars. Currency or transfer risks therefore result primarily from exchange rate fluctuations affecting Central and Eastern European currencies. For this reason, it is impossible to rule out the risk of a devaluation of the Ukrainian currency, the hryvnia, compared to the budget estimate, especially in view of the war in Ukraine. This means that the relevant exchange rate risks are subject to high levels of uncertainty. There are also exchange rate risks related to the measurement of euro loans at companies which are distributed in local currency. The extent of these risks is influenced by both the development of exchange rates and the development of the loan portfolio. At present, the risks are higher than in the previous year; in the medium term, however, the risks could increase further, particularly given the planned expansion of Intermodal activities.

All HHLA companies operating with foreign currencies reduce the risk of currency fluctuations by monitoring exchange rates regularly and, where possible, transferring free liquidity in local currency to hard-currency accounts.

Bad debt losses

During the coronavirus pandemic and in view of the surge in demand in some shipping regions, there was strong competition for shipping capacities and a resulting spike in freight rates. HHLA’s shipping customers are continuing to benefit considerably from this trend; despite uncertainty on the market as a result of the coronavirus pandemic and increasing geopolitical tensions, they still achieved high earnings in 2022. This high level looks set to decline in 2023 due to lower freight rates and overcapacities in shipping. 1. Market environment

In the Container segment, the risk of customer insolvency – with the corresponding loss of throughput and receivables – is still regarded as very unlikely due to the recent high earnings of shipping company customers and is thus immaterial in the reporting period. However, as uncertainties remain with regard to weaker demand due to inflation, the development of bunker costs and the likelihood of further freight rate decreases in 2023, influenced by shipping company capacity management, this risk continues to be monitored.

For Logistics properties and in the Speicherstadt historical warehouse district, there are still rent default risks and with them the risk of costs for any necessary modification or renovation of rented space. HHLA is in close contact with its tenants in order to adopt any necessary measures quickly. As in the previous year, it is deemed unlikely that any such risks will occur.

HHLA uses credit checks to reduce del credere collection risks. Active receivables management is used to monitor compliance with contractually agreed payment deadlines.

Pension obligations

The end of the European Central Bank’s quantitative easing policy is leading to an initial normalisation of the relevant interest rate used to calculate the present value of pension obligations. Further interest rate adjustments are likely in order to steady inflation rates. The risk of pension provisions increasing due to lower interest rates has decreased further since last year, with the risk of occurrence deemed unlikely. HHLA monitors interest trends so that it can adjust its provisions as necessary.

For further details of downstream default risks, liquidity risks, interest and exchange rate risks, including risk mitigation measures and the management of these risks, please see the report on financial instruments in the notes to the consolidated financial statements. Notes to the consolidated financial statements, no. 47 Management of financial risks

3. Other risk and opportunity factors

Climate risks

The results of the risk and vulnerability assessment conducted for the first time in 2022 in accordance with the requirements of the EU Taxonomy show that the climate risks of floods and landslides as a result of extreme weather events, which have already been identified as significant, are not expected to change significantly in the period under consideration until 2050 on the basis of current climate data. There are no other material climate risks at present. As a result, no further adaptive solutions or modifications to the existing measures are required at present.


As a result of the existing structural situation and the fact that HHLA’s Hamburg port facilities and buildings necessarily operate close to water, there is a fundamental risk of storm surges. However, flood protection work undertaken by HHLA and the Free and Hanseatic City of Hamburg in previous years has reduced this risk considerably. The residual risk remains largely unchanged compared to the previous year.

Should this risk ever materialise, comprehensive emergency programmes have been put in place by public authorities and companies operating in the port as well as the Speicherstadt historical warehouse district, to minimise the potential damage. In addition, the risk of damage to property is sufficiently covered by insurance policies.

Extreme weather events

In the course of climate change, an increase in extreme weather events can also be observed in Europe. Intermodal transport operations in particular may be adversely affected by the weather-related closure of track sections. A high level of flexibility is required with regard to operating equipment and personnel to maintain rail-based container transportation. Operations in the Intermodal segment are systematically geared towards ensuring that customers receive the agreed service level, even in challenging weather conditions. As in the previous year, temporary increases in additional costs caused by specific events cannot be ruled out.

Investment options

In addition to organic growth, HHLA systematically examines and evaluates acquisition opportunities as part of its growth and innovation strategy. The focus is on equity investments aimed at expanding or supplementing the portfolio in the core segments of Container and Intermodal, as well as in innovative technology companies and start-ups in the transport and logistics sector. In addition to strategic aspects and synergies with HHLA’s existing activities, key decision-making criteria include growth prospects, the anticipated return on capital employed, and the assessment of commercial opportunities and risks.

HHLA is in a sound financial position. It therefore has the financial means to make further acquisitions. In 2022, HHLA therefore acquired the logistics company CL EUROPORT in Malaszewicze near the Belarusian border, adding a further major hub to the freight transport network within Central and Eastern Europe and for Eurasian transportation.

Technological innovations and digitalisation

One of HHLA’s goals is to relieve pressure on the transport infrastructure in and around the Port of Hamburg by seeking innovative and sustainable solutions and by using the capacities of its terminals more efficiently. To achieve this, HHLA uses machine learning at CTB, for example, to optimise the positioning of containers in the yard and thus boost productivity.

Furthermore, HHLA has set up new company units and invests in promising start-ups to provide the necessary space for technological and entrepreneurial innovation in logistics to flourish, especially with regard to innovative business activities along the material and digital logistics value chain. One example of this is the “modility” booking portal, a platform that simplifies access to intermodal transport.

The innovative development of our core business and the tapping of new growth drivers may produce additional opportunities for boosting efficiency and value added in future. Such opportunities are associated with certain start-up costs and an entrepreneurial risk that must be carefully reviewed and weighed up against the corresponding opportunities. Innovation

4. IT risks

HHLA’s business processes rely heavily on the availability and security of IT applications. In the event of a cyberattack, temporary restrictions or failures in IT applications, e.g. due to the destruction of data, cannot be ruled out. Moreover, significant demands for the release of data may be made. Extensive protective mechanisms for incoming data and communication, as well as control measures such as secure back-ups, serve to protect against attacks and/or significantly reduce the impact of any damage. In view of the rising number of cyber attacks on companies, particularly against the backdrop of the war in Ukraine, the risk that HHLA could also be affected by a damaging attack remains moderate.

5. Service provision risks

Price calculation risks in the Speicherstadt historical warehouse district

Due to the continually high workload in the construction sector and the ongoing global shortage of building materials, there are currently price calculation risks for construction projects in the Speicherstadt historical warehouse district for which contracts have not yet been awarded. Measures such as the close involvement of Purchasing in projects serve to optimise costs. Given their high likelihood of occurrence, these have been taken into account in our planning. No other risks have been identified at present.

Strike risks

Disputes relating to collective bargaining or transformation processes may lead to interruptions or delays to operations, with a corresponding impact on earnings, especially in the Container and Intermodal segments. As external strikes are relevant to the Intermodal segment, communication with customers and flexibility with regard to routing are effective measures for reducing the potential scale of damage. In the Container segment, internal industrial action cannot be ruled out. This is counteracted by means of extensive communication regarding transformation processes and the close involvement of the works council.

Other operating risks

Moreover, transformation processes and the corresponding achievement of planned project targets may be delayed. We aim to prevent any delays by taking extensive communication measures and ensuring the close involvement of all parties. Against the backdrop of potential staff shortages, this risk has increased since the previous year.

Due to the special structures and age of the buildings in the Speicherstadt historical warehouse district, short-notice renovation requirements may go beyond the scope of our planning. This may result in unscheduled additional costs. Structural appraisals and expert assessments allow the occurrence of any risks to be detected at an early stage. As a result of increasing construction costs, the risk is now considered material.

Furthermore, the need for write-downs on property, plant and equipment that can no longer be used for their intended purpose due to unexpected market developments, or that are subsequently deemed unsuitable, still cannot be ruled out. As a result of measures taken, particularly in the form of tests and analyses prior to purchase, this risk is deemed unlikely.

In addition to their economic impact, pandemics can disrupt or interrupt operations within the HHLA Group due to illness. In the course of the coronavirus pandemic, HHLA implemented extensive measures to ensure the safety of its employees and the continuation of its operations. According to the Robert Koch Institute (RKI), the pandemic has now entered the endemic, wave-like phase. According to the German Protection Against Infection Act, no regulations are currently in place affecting HHLA at the reporting date. At present, the service provision risks from pandemics are still deemed immaterial.

6. Strategic environment


HHLA’s competitiveness largely depends on Hamburg’s infrastructure as a port and logistics hub. Hamburg’s offshore, onshore and regional transport networks must be able to cope with the flows of goods and their carriers. As an infrastructure-related operator, HHLA and its subsidiaries depend on prompt provision of the scheduled volume of public investments and services that are frequently necessary to support their own investments and ensure facilities are not jeopardised. Infrastructural deficits such as the current restrictions on navigability of the river Elbe due to silt could cause throughput and transport volumes to bypass HHLA’s sites. Attempts are currently being made to remove the restrictions on the river Elbe. How these risks will develop over the medium and long term remains to be seen.

The regional road and rail infrastructure must be modernised and expanded if the Port of Hamburg wants to retain and enhance its competitiveness while optimising processes for in- and outbound flows of goods in its hinterland. This may lead to additional costs or delays in the Intermodal segment due to bottlenecks in the rail network linked to poor rail infrastructure or delays caused by construction work, for example. The flexibility of its own rolling stock helps to ensure that any impact on earnings from such events is unlikely and still not deemed a material risk to the HHLA Group. Projects of special significance to HHLA in the medium term include the replacement of the Köhlbrand Bridge, the construction of the port crossing (A 26) and the upgrading of the Kiel Canal, including its locks.

HHLA cooperates closely with the relevant public institutions on these projects. It also safeguards its interests by participating in relevant committees and through lobbying and active public relations activities.

7. Legal risks

Compliance incidents

Well-trained and motivated employees are the foundation of responsible business activities. The Group’s relationship with its employees is informed by its sense of social responsibility. Staff representatives are closely and actively involved in Group decision-making and take their responsibilities seriously. However, it is impossible completely to rule out the risk of employees committing fraudulent acts or legal and competitive violations in the course of their work. Furthermore, any infringements of specific areas of law (e.g. competition law, data privacy) may lead to fines based on Group key figures which could therefore potentially reach significant proportions.

To reduce these risks, HHLA has introduced guidelines, manuals and double-checking, embedded controls in its processes and established spot checks as part of its compliance management system. The Group has also issued a Code of Conduct that applies to all Group managers and staff. In line with the current risk profile, training sessions are held regularly on the contents of the Code of Conduct as well as other specialised issues such as the prevention of corruption and conduct in the competitive environment. All of these activities are supported by additional communication measures, for example via the HHLA intranet. There are also opportunities for both employees and third parties to report violations via the whistle-blower hotline. Should compliance violations occur, specific process adjustments may be undertaken to prevent them in future. In cases of theft, for instance, corresponding security measures are reviewed and possibly introduced to prevent as far as possible any more such items going missing. Furthermore, regular analysis of compliance risks and IT-based business partner screening – which enables the risk-oriented screening of HHLA business partners across the Group – help to identify compliance risks at an early stage and thus minimise risk. This also applies to HHLA’s Supplier Code of Conduct, which is now used throughout the Group.

Process risks

Changes in initial assumptions or general conditions may cause projects to fall significantly short of the underlying economic feasibility calculation. This in turn may necessitate the termination of long-term contracts and potentially result in legal disputes. HHLA adopts preventive measures, including the use of legal expertise, to prevent or resolve such disputes.

New regulatory requirements

Changes to legislation, regulatory reforms or amended requirements may necessitate changes to HHLA’s internal processes or existing equipment, and could lead to cost increases. By ensuring a steady flow of information and cooperating closely with the relevant authorities, HHLA is able to make timely internal preparations and forward-looking investments aimed at reducing the associated costs wherever possible. Against this backdrop, the risks are lower than in the previous year’s assessment and deemed immaterial.

Conversely, new regulations may also lead to opportunities that mainly boost the market potential of technological innovations.

Economy of scale
A rule of economics which says that higher production quantities go hand in hand with lower unit costs.
A port’s catchment area.
Hub terminal (Hinterland)
A terminal which bundles and distributes consignments as hand­ling hub. HHLA’s rail companies operate hub terminals like this in Ceska Trebova, Budapest, Dunajska Streda, Poznan and Prague.
Impairment test
Assessment of an asset’s value in accordance with IFRS.
Intermodal/Intermodal systems
Transportation via several modes of transport (water, rail, road) combining the specific advantages of the respective carriers.
Payments for investments in property, plant and equipment, investment property and intangible assets.
North range
The North European coast. In the broadest geographic sense, this is where all the international ports in Northern Europe from Le Havre to Hamburg can be found. The four largest ports are Hamburg, Bremerhaven, Rotterdam and Antwerp.
Revenue from sales or lettings and from services rendered, less sales deductions and VAT.
In maritime logistics, a terminal is a facility where freight transported by various modes of transport is handled.
The action of a locomotive pulling a train.
Value added
Production value – intermediate inputs (cost of materials, depreciation and amortisation, and other operating expenses); the value added generated is shared between the HHLA Group’s stakeholders, such as employees, shareholders, lenders and the local community.

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