Earnings Position

The economic development of HHLA in the first half of 2016 was in line with expectations. HHLA saw a decline in container throughput of 5.7 % to 3,209 thousand TEU in the first half of the year (previous year: 3,404 thousand TEU). This was due to a further drop in traffic to and from Asia and feeder volumes for the Baltic Sea ports.

Transport volumes increased significantly by 6.2 % to 694 thousand TEU (previous year: 654 thousand TEU). Routes to the north German seaports and the Adriatic ports recorded particularly strong growth.

Revenue for the HHLA Group amounted to € 573.5 million in the reporting period and was thus down 2.0 % on the prior-year figure (€ 585.1 million). The volume-related decrease in revenue in the Container segment, as well as lower revenue in the Logistics segment, was only partially offset by revenue growth in the Intermodal segment.

In its Container, Intermodal and Logistics segments, the listed Port Logistics subgroup generated revenue of € 557.8 million in the reporting period (previous year: € 569.8 million). This decrease almost matched the trend for the Group as a whole. The non-listed Real Estate subgroup increased revenue by 3.8 % to € 18.7 million (previous year: € 18.0 million) and contributed 2.7 % to Group revenue.

As in the previous year, changes in inventories of € 0.9 million did not have any noticeable influence on consolidated profit (previous year: € - 0.7 million). Own work capitalised amounted to € 3.5 million (previous year: € 5.2 million).

The decrease in other operating income to € 16.1 million (previous year: € 18.6 million) was mainly due to a provision for legal risks, which was partially reversed through profit or loss in the previous year.

Despite the divergent development of individual items, operating expenses as a whole increased slightly by 0.3 % to € 527.1 million. Without one-off expenses in the Logistics segment, operating expenses would have fallen by 2.5 %.

The cost of materials declined by 8.0 % in the reporting period to € 168.6 million (previous year: € 183.2 million). In absolute terms, the decrease was largely due to lower revenue in the Container and Logistics segments. By contrast, the decline in the cost of materials ratio to 29.4 % (previous year: 31.3 %) was primarily attributable to cost structure changes from the expansion of the company’s own traction in the Intermodal segment.

Personnel expenses increased significantly year on year by 6.6 % to € 224.0 million (previous year: € 210.2 million). The increase mainly relates to one-off expenses for project and contract logistics. Adjusted for this item, personnel expenses were virtually unchanged compared to the previous year. The personnel expense ratio rose to 39.1 % (previous year: 35.9 %) This rise was mainly the result of one-off expenses.

Other operating expenses rose by 5.1 % in the reporting period to € 75.6 million (previous year: € 71.9 million). The increase was again attributable to greater use of the company’s own traction fleet for intermodal services. At 13.2 %, the ratio of expenses to revenue was up on the previous year (12.3 %).

The strong decline in the operating result before depreciation and amortisation (EBITDA) of 12.0 % to € 125.8 million (previous year: € 142.9 million), largely due to one-off expenses for project and contract logistics. The EBITDA margin declined to 21.9 % in the reporting period (previous year: 24.4 %). Without the one-off expenses of € 14.9 million, the EBITDA margin would be on a par with the previous year at 24.5 %.

Depreciation and amortisation was down slightly by 2.2 % to € 58.9 million (previous year: € 60.3 million). Its ratio to revenue was unchanged at 10.3 %.

At Group level, the operating result (EBIT) declined by 19.1 % to € 66.9 million (previous year: € 82.6 million). The EBIT margin decreased to 11.7 % (previous year: 14.1 %). Without the one-off expenses, the EBIT margin would have increased slightly to 14.3 %. The Port Logistics and Real Estate subgroups contributed 87.9 % and 12.1 % to EBIT, respectively.

Net expenses from the financial result fell by € 5.3 million to € 10.4 million (previous year: € 15.7 million), mainly due to an improved interest result. The financial result includes negative exchange rate effects of € 1.2 million (previous year: € 5.3 million) due mainly to the devaluation of the Ukrainian currency.

At 27.9 %, the Group’s effective tax rate was higher than in the previous year (25.1 %). This is primarily due to a one-off tax expense for prior years in the Port Logistics subgroup.

Profit after tax decreased by 18.8 %, from € 50.2 million to € 40.8 million. There was a disproportionately strong year-on-year decline in profit after tax and minority interests of 31.1 % to € 25.8 million (€ 37.5 million) due to one-off expenses in the Logistics segment, which were charged to subsidiaries fully owned by HHLA. At € 0.35, earnings per share were also down 31.1 % on the prior-year figure of € 0.52. The listed Port Logistics subgroup reported a 36.0 % decrease in earnings per share to € 0.30 (previous year: € 0.47). Earnings per share of the non-listed Real Estate subgroup improved by 7.2 % to € 1.68 (previous year: €1.56). The return on capital employed (ROCE) declined by 2.7 percentage points to 10.1 % (previous year: 12.8 %). Without the one-off expenses, ROCE would have been 0.5 percentage points lower than in the previous year at 12.3 %.