Earnings position

HHLA’s performance data displayed a very stable development in 2018. At 7,336 thousand TEU, there was a slight rise of 1.9 % in container throughput (previous year: 7,196 thousand TEU). The increase was mainly due to the takeover of the container terminal in Tallinn and a rise in Asian traffic at the Port of Hamburg and was achieved in spite of the adverse effect from the takeover of Hamburg Süd by the shipping company Maersk and the resulting removal of a service from the HHLA terminals. At 1,480 thousand TEU, transport volume remained at the high level of the previous year. The decrease in road transport was offset by a rise in rail transport.

Revenue

in € million

Against this background, revenue of the HHLA Group rose by 3.1 % to € 1,291.1 million (previous year: € 1,251.8 million) in the reporting period. All four segments of HHLA contributed to this rise. In particular, the increase was facilitated by a rise in rail’s share and longer transport distances in the Intermodal segment, the revenues of the container terminal in Tallinn and temporary additional business in the area of vehicle logistics. The listed Port Logistics subgroup largely developed in line with the HHLA Group as a whole. Its Container, Intermodal and Logistics segments recorded an overall increase in revenue of 3.1 % to € 1,258.5 million (previous year: € 1,220.3 million). The non-listed Real Estate subgroup achieved a similar increase in revenue of 3.6 % to € 39.3 million (previous year: € 37.9 million). The Real Estate subgroup thus accounted for 2.5 % of Group revenue.

At € 0.4 million, changes in inventories once again had no material impact in the reporting period (previous year: € - 0.3 million). Own work capitalised decreased to € 5.2 million (previous year: € 5.4 million).

There was no significant year-on-year change in other operating income.

Operating expenses

Expense structure 2018

Due to opposing trends in the expenditure types, operating expenses rose slightly by 1.0 % to € 1,134.0 million (previous year: € 1,123.2 million).

Compared to the previous year, the cost of materials was reduced slightly by 0.9 % to € 367.1 million (previous year: € 370.5 million). The decline in the cost of materials ratio to 28.4 % (previous year: 29.6 %) resulted from an increase in vertical integration in rail transport, as well as from the decrease in track fees for German rail freight.

Personnel expenses rose by 3.6 % to € 480.6 million (previous year: € 463.8 million). In addition to higher union wage rates, other factors included the Budapest terminal put into operation in mid 2017 and the integration of the container terminal in Tallinn. The previous year’s figure included expenses for organisational restructuring in the Container segment. The personnel expense ratio remained virtually unchanged at 37.2 % (previous year: 37.1 %).

Other operating expenses increased moderately by 3.5 % in the reporting period to € 172.1 million (previous year: € 166.3 million). The main causes were maintenance work on locomotives, consultancy services (including on HHLA’s digital strategy) and increased rental and leasing expenses. The previous year’s figure included expenses for the harmonisation of existing pension schemes. The ratio of expenses to revenue remained unchanged at 13.3 %.

Depreciation and amortisation fell considerably by 6.8 % year-on-year to € 114.2 million (previous year: € 122.6 million). This was partly due to the revaluation of the useful lives of storage cranes and container wagons.

Against the background of these developments, the operating result before depreciation and amortisation (EBITDA) rose by 7.7 % to € 318.5 million (previous year: € 295.8 million) and thus more strongly than revenue. There was a corresponding moderate increase in the EBITDA margin to 24.7 % (previous year: 23.6 %).

Operating result (EBIT)

in € million / EBIT margin in %

The operating result (EBIT) was increased by 17.9 % to € 204.2 million in the reporting period (previous year: € 173.2 million). As a result of the significantly stronger rise compared to revenue, the EBIT margin increased considerably to 15.8 % (previous year: 13.8 %). In the Port Logistics subgroup, EBIT rose by 20.3 % to € 188.4 million (previous year: € 156.6 million). As a result, the subgroup accounted for 92.3 % (previous year: 90.4 %) of the Group’s operating result in the reporting period. In the Real Estate subgroup, EBIT decreased 5.1 % to € 15.5 million due to scheduled large-scale maintenance work that does not qualify for capitalisation (previous year: € 16.3 million). 7.7 % of the Group’s operating result was generated by this subgroup (previous year: 9.6 %).

Net expenses from the financial result fell by € 5.3 million, or 20.3 %, to € 20.6 million (previous year: € 25.9 million). This was mainly due to the revaluation of an equalisation liability payable to a minority shareholder in conjunction with a profit and loss transfer agreement of a subsidiary.

At 24.6 %, the Group’s effective tax rate was lower than in the previous year (previous year: 28.1 %).

Profit after tax and minority interests increased by 38.5 % year-on-year to € 112.3 million (previous year: € 81.1 million). Non-controlling interests accounted for € 26.2 million in the 2018 financial year (previous year: € 24.8 million). From a financial point of view, this item includes the expenses mentioned in relation to the financial result associated with revaluing an equalisation liability payable to a minority shareholder. Earnings per share rose by 38.5 % to € 1.54 (previous year: € 1.11). The listed Port Logistics subgroup achieved a 44.5 % increase in earnings per share to € 1.47 (previous year: € 1.02). Earnings per share of the non-listed Real Estate subgroup were down on the prior-year figure at € 3.46 (previous year: € 3.65). As in the previous year, there was no difference between basic and diluted earnings per share in 2018. The return on capital employed (ROCE) was up 1.7 percentage points year-on-year at 14.8 % (previous year: 13.1 %).  Corporate and value management

As in the previous year, HHLA’s appropriation of profits is oriented towards the development of the HHLA Group’s earnings in the financial year ended. The distributable profit and HHLA’s stable financial position form the foundation of the company’s consistent profit distribution policy. On this basis, the Executive Board and Supervisory Board will propose at the Annual General Meeting on 18 June 2019 a dividend of € 0.80 per class A share and € 2.10 per class S share. Based on the number of shares with dividend entitlement as of 31 December 2018, the amount to be distributed for listed class A shares would increase by 19.4 % to € 56.0 million (previous year: € 46.9 million). The amount to be distributed for non-listed class S shares would increase by 5.0 % year-on-year to € 5.7 million (previous year: € 5.4 million). In relation to the consolidated profit and earnings per share, the dividend payout ratio would reach a high level of approximately 54 % for the Port Logistics subgroup (previous year: 66 %) and around 61 % for the Real Estate subgroup (previous year: 55 %).