HAMBURGER HAFEN UND LOGISTIK AG Investor Presentation Berenberg European Conference USA 2016 Tarrytown, 25 May 2016
Disclaimer The facts and information contained herein are as up to date as is reasonably possible and are subject to revision in the future. Neither the Company nor any of its parent or subsidiary undertakings nor any of such person s directors, officers, employees or advisors nor any other person makes any representation or warranty, express or implied as to, and no reliance should be placed on, the accuracy or completeness of the information contained in this presentation. Neither the Company, nor any of its parents or subsidiary undertakings nor any of their directors, employees and advisors nor any other person shall have any liability whatsoever for loss howsoever arising, directly or indirectly, from any use of this presentation. The same applies to information contained in other material made available at the presentation. While all reasonable care has been taken to ensure that the facts stated herein are accurate and that the opinions contained herein are fair and reasonable, this document is selective in nature. Where any information and statistics are quoted from any external source, such information or statistics should not be interpreted as having been adopted or endorsed by the Company as being accurate. This presentation contains forward-looking statements relating to the business, financial performance and results of the Company and/or the industry in which the Company operates. These statements generally are identified by words such as believes, expects, predicts, intends, projects, plans, estimates, aims, foresees, anticipates, targets and similar expressions. The forward-looking statements, including but not limited to assumptions, opinions and views of the Company for information from third party sources, contained in this presentation are based on current plans, estimates, assumptions and projections and involve uncertainties and risks. Various factors could cause actual future results, performance or events to differ materially from those described in these statements. The Company does not represent or guarantee that the assumptions underlying such forward-looking statements are free from errors and the Company does not accept any responsibility for the future accuracy of the opinions expressed in this presentation. No obligation is assumed to update any forward-looking statements. By accepting this presentation you acknowledge that you will be solely responsible for your own assessment of the market and the market position of the Company and that you will conduct your own analysis and be solely responsible for forming your own view of the potential future performance of the Company s business. This presentation is not a prospectus and does not constitute an offer or an invitation or solicitation to subscribe for, or purchase, any shares of the Company and neither this presentation nor anything contained herein shall form the basis of, or be relied on in connection with, any offer or commitment whatsoever. 2
Agenda Company Profile and Strategy Business Development Q1/2016 Forecast 2016 3
A Leading Port and Transport Logistics Group Segments of the listed Port Logistics subgroup Company Profile and Strategy Integrated container handling, Intermodal and logistics services along the transport chain between the overseas port and its hinterland Container segment Container handling Container transfer and storage Value-added container services (e.g. repair, maintenance) Intermodal segment Rail- and road-bound transport services into the ports hinterland Loading/Unloading of carriers Operation of inland terminals Total revenue 2015 1.1 billion Share of revenue 675 million Share of revenue 364 million 61% 33% Logistics segment Special seaport handling of bulk cargo, fruit, RoRo, ConRo Consulting & training Warehousing & contract logistics Handling of cruise ships Share of revenue 65 million 6% 4
Business Model Value creation based on vertical integration Company Profile and Strategy 5
Favourable Geographical Location Company Profile and Strategy Hub for the major economies of Asia and Central and Eastern Europe Sea-bound container throughput 2015 of HHLA by region 53% Asia 11% Baltic Sea 11% Scandinavia 8% North America 7% South America 5% Rest of Europe 3% Africa 2% Other countries ASIA / FAR EAST BALTIC SEA / SCANDINAVIA CENTRAL AND EASTERN EUROPE Port of Hamburg Germany s largest logistics hub Cost advantages for shipping lines due to central location deep inland Europe s largest railway port with dense rail network to CEE Europe s densest feeder network to the Baltic Sea via the Kiel Canal Intense and long-standing trade relations with Asia High share of local cargo due to populous and economically strong Hamburg region Well balanced import/export flows 6
Advanced Terminal Technology High automation level with mega-ship berth in operation Company Profile and Strategy Market share of 73 % in Hamburg and 18 % in the North Range State-of-the-art handling technology, innovative IT systems and a high level of automation Modern handling facilities for the latest generation of ULCV s already in operation at CTB Further gantry cranes for handling of upcoming 20 TTEU ULCV ordered for facilities at CTT and CTB Further rollout of additional automated block storage capacities at CTB until 2017 Optimised traffic coordination for an improved cargo flow and terminal access 7
Investments for Higher Value Added Company Profile and Strategy 13 hinterland terminals, 52 locomotives and more than 2,000 wagons Hub and inland terminals in the hinterland Multi-system locomotives and shunting engines Light-weighted wagons with modern braking system Investments in million 188.4 Approx. 190 million investment in own terminals and rolling stock since 2012 77.2 46.9 52.3 12.0 2012 2013 2014 2015 Total More than 53 % of subgroup investments in 2015 was spent on Intermodal segment 8
Intermodal Network Company Profile and Strategy High degree of own traction in the hinterland raises level of value added Connections per week Germany 60 Czech Republic, Slovakia & Hungary 233 Poland 54 Netherlands 14 Switzerland 6 Austria 20 Adriatic coast 54 Turkey 10 High-frequency shuttle train connections to all major economic centres in the ports hinterland Own assets (terminals, repair and maintenance facilities as well as own rolling stock) 13 well located inland hub terminals with innovative design and technology More than 2,000 lightweighted wagons with modern braking system and locomotives to further enhance product quality and improve cost efficiency 9
Company Profile and Strategy Successfully Implemented Diversification Strategy Intermodal contributes significantly to earnings and stability of the subgroup Transport volume in TTEU 1,172 CAGR + 6.0 % 1,283 1,318 Revenue in million 314.5 CAGR + 7.6 % 351.5 364.0 2013 2014 2015 2013 2014 2015 EBIT and EBIT margin in million, % CAGR + 55.6 % 55.2 Segment assets and ROCE in million, % 297.0 329,6 375.2 22.8 27.3 7.3 % 7.8 % 15.2% 7.8 % 8.7 % 15.7% 2013 2014 2015 2013 2014 2015 10
Challenges and Measures Taking opportunities in a changing market environment Company Profile and Strategy Current challenges Worldwide slowdown of growth in the economy, trade and container handling Structural changes in the Chinese economy Ongoing economic crises in Russia and Ukraine Intensified competition between ports in the North, Baltic and Mediterranean Sea New alliances between shipping liners Continued peak load conditions due to further delay of dredging the river Elbe and ship size growth Further continuing infrastructure deficits Measures Focusing on activities with high value added and profitability Ship size-related expansion of our container terminals Productivity gains by further automation and further optimisation of processes as well as improvement of transport coordination Continued growth in our Intermodal activities Increasing customer satisfaction by outstanding product quality and reliability Intensified search for horizontal participation opportunities in attractive growth markets 11
Strategic Focus of HHLA Company Profile and Strategy Further diversification to reduce one-sided dependencies and risks Assertion and expansion of our market leadership in Hamburg Further expansion of network and terminals of our Intermodal subsidiaries for European sea port hinterland and continental transport Accelerated horizontal growth by expanded regional and product strategy A leading port logistics operator in Europe turns into a leading European port and transport logistics Group 12
Agenda Company Profile and Strategy Business Development Q1/2016 Forecast 2016 13
Business Environment Weak global growth of economy, trade and container handling continues Macroeconomic development Business climate indicators assume a continued slowdown of momentum for global economy in the 1 st quarter 2016 1 Declining trend of Chinese growth dynamics continues in the 1 st quarter 2016 with a GDP growth of 6.7 % y-o-y 2 Regional crises keep burdening the economies in Russia (2015: - 3.7 %) 3 and Ukraine (2015: - 9.9 %) 4 Sector development 5 Business Development Q1/2016 Global container growth in 1 st quarter 2016 meets expectation with a slight increase of 1.4 % in the 1 st quarter Further downturn of shipping region China to 2.3 % with effects on the whole Asian region Stabilization of North-West European volumes with + 0.4 % y-o-y Scandinavia and the Baltic region still with shrinking container throughput of - 7.6 % y-o-y Source: 1 IfW World Economic Development in Spring, March 2016 2 Reuters, Press Release 15.04.2016 3 International Monetary Funds World Economic Outlook, April 2016 4 Weltbank Ukraine Economic Update April 2016 5 Drewry Maritime Research Container Forecaster Q1/2016 14
EBIT Remains Under Pressure Intermodal growth can largely compensate downturn in Container Key Figures Q1/2016 of the Port Logistics Subgroup Business Development Q1/2016 Revenue 277.1 million - 4.3 % Moderate decrease in revenue EBIT 37.1 million - 4.3 % EBIT correspondingly lower EBIT margin 13.4 % 0.0 pp EBIT margin on prior year s level Profit after tax and minorities 16.0 million + 52.9% Profit after tax and minorities clearly increased Container throughput thereof in Hamburg 1,612 TTEU 1,545 TTEU - 7.7 % - 8.2 % Container throughput down y-o-y Container transport 341 TTEU + 2.4 % Slight growth in container transport 15
Container Segment January to March 2016 Business Development Q1/2016 Container throughput in TTEU - 7.7 % 1,747 1,657 1,623 1,534 1,612 + 5.1 % 15Q1 15Q2 15Q3 15Q4 16Q1 Decline in volumes at the Hamburg terminals mainly due to lower feeder traffic with the Baltic ports (- 11.2 %) and weak Far East volume But positive trend of 5.1 % compared to 15Q4 Positive trend y-o-y in Odessa (+ 4.8 %) Revenue in million 180,0-6.0 % 171,9 166,8 156,5 + 8.1 % 169,2 15Q1 15Q2 15Q3 15Q4 16Q1 Revenue decrease mainly due to a decline in volumes at the Hamburg terminals Average revenue per TEU up due to a change in cargo mix and lower feeder ratio of 22.6 % (previous year: 23.3 %) EBIT in million 32,6-14.2 % 24,9 26,0 27,1 27,9 + 3.1 % 15Q1 15Q2 15Q3 15Q4 16Q1 EBIT down as a result of lower volumes and lower utilisation Positive trend of 3.1 % compared to 15Q4 EBIT margin down to 16.5% (previous year: 18.1 %) 16
Intermodal Segment January to March 2016 Business Development Q1/2016 Container transport in TTEU 333 321 + 2.4 % 342 322 + 5.9 % 341 15Q1 15Q2 15Q3 15Q4 16Q1 Slight increase in a highly competitive market Development was driven by the growth in rail transportation (+ 4.8 % to 264 TTEU) Road transport in the metropolitan region of Hamburg decreased by 4.9 % to 77 TTEU Revenue in million 91,7 89,1 + 1.0 % 92,0 91,2 + 1.5 % 92,6 Revenue development below volume dynamics mainly due to a changed transport mix and a decrease in the average transport distance as well as a higher proportion of empty containers in the total transport volume 15Q1 15Q2 15Q3 15Q4 16Q1 EBIT in million 12,7 14,1 + 28.6 % 17,2 11,2 + 45.1 % 16,3 15Q1 15Q2 15Q3 15Q4 16Q1 EBIT again significantly outperformed volume and revenue growth; as a result of ramp-up the productivity gains and cost improvements haven t been fully effective in 15Q1 EBIT margin up to 17.6 % (previous year: 13.8 %) 17
Logistics Segment January to March 2016 Business Development Q1/2016 Revenue in million 15,1 18,0-10.8 % 15,8 16,2 13,4 Restrained development of segmental revenues of fully consolidated companies - 17.5 % 15Q1 15Q2 15Q3 15Q4 16Q1 EBIT in million -1,3 0,2 0,5 + 24.8 % -0,2 neg. -1,0 15Q1 15Q2 15Q3 15Q4 16Q1 EBIT improvement on segmental level mainly driven by an improved cost structure due to an intercompany transaction in 15Q3 between the vehicle logistics and Holding/Others Since the cost improvement was not included in 15Q1, the quarters are not fully comparable Earnings from associates (using the equity method) + 1.6 % Earnings from associates on previous years level 1,2 1,0 1,0 0,5 0,3 pos. 15Q1 15Q2 15Q3 15Q4 16Q1 18
Earnings Bridge Net profit and EPS substantially increased Business Development Q1/2016 in million; figures of the Port Logistics subgroup 37,1 1,1 5,1 EPS 0.23 + 52.9% 1,7 7,6 7,8 16,0 At-equity earnings on prior year's level Considerably lower negative F/X effect (- 78.1 % y-o-y) Effective tax rate considerably down by 7.6 pp to 24.1 % Net financial - 4.3 % result up by 12.9 % Minorities up by 4.6 % + 52.9% EBIT Earnings from associates Net interest income F/X translation Tax Minorities Net profit 19
Agenda Company Profile and Strategy Business Development and Financial Performance Q1/2016 Forecast 2016 20
Forecast 2016 Challenging environment and one-off expenses affect development Forecast 2016 Market Environment Performance of Port Logistics GDP trend 2016 in % 3,2 Global 6,5 China 1,5 Germany Russia Volumes Container throughput: on previous year s level (2015: 6.6 million TEU) Container transport: slight increase on previous year (2015: 1.3 million TEU) Source: IMF / April 2016 Container throughput trend 2016 in % 2,1 Global 2,8 China Source: Drewry Maritime Research / April 2016 0,8 North West Europe -1,8 Scandinavia and Black Sea -6,4 Revenue On previous year s level (2015: 1.1 billion) EBIT In a range between 100 million and 130 million incl. one-off consolidation expenses of about 15 million Investments In the region of 180 million Almost all of which is allocated for the Port Logistics subgroup Interim Results January March 2016 21
Appendix 22
Key Takeaways Company Profile and Strategy Vertical integration Location Business model of vertical integration with a high level of value added services enables optimisation of all processes along the logistics chain between the seaport and the European hinterland Strong natural catchment area due to favourable geographic location of Hamburg as most easterly North Sea port which makes it the ideal hub for the entire Baltic region and for hinterland traffic to and from CEE Technology High level of automation, advanced handling technology and innovative IT systems ensure operational excellence and data exchange with customers Intermodal strategy Financial stability Cost leadership in Intermodal rail services due to own assets and dominant market positions Solid financial fundament with capacity and productivity reserves to maintain our position as a leading port and transport logistics group and to achieve a sustainable growth in our enterprise value 23
Appendix Business Environment 2015 Weak global growth of economy, trade and container handling Economic Development (GDP)* Lowest growth of global economy since 2009 Slowdown of Chinese growth dynamics Russian economy mired in recession Crisis of Ukrainian economy World trade grows weaker than global GDP y-o-y + 3.1 % + 6.9 % - 3.7 % - 9.0 % + 2.6 % * Source: International Monetary Fund (IMF) World Economic Outlook Update (January 2016) Development of Container Throughput** Worldwide well below expectations North West Europe shrinks Scandinavia and Baltics lose heavily Decline in Eastern Mediterranean and Black Sea Slight decline in Western Mediterranean Sea + 1.3 % - 1.9 % - 17.3 % - 2.9 % - 0.9 % ** Source: Drewry Maritime Research Container Forecaster 4Q 2015 24
Profit after Tax and Minorities Increased Clearly Decline in revenue and operating result Appendix Key Figures 2015 of the Port Logistics Subgroup Revenues 1,111.0 million - 5.1 % Decrease in revenue EBIT 141.1 million - 9.3 % EBIT below previous year EBIT margin 12.7 % - 0.6 pp Profit after tax and minorities 58.9 million + 12.8 % Container throughput thereof in Hamburg thereof in Odessa 6,561 TTEU 6,305 TTEU 256 TTEU - 12.3 % - 12.6 % - 2.9 % Container transport 1,318 TTEU + 2.7 % EBIT margin almost maintained on prior year s level Profit after tax and minorities considerably up Decline in container throughput Container transport increased once again 25
Container Segment Financial year 2015 Appendix Revenues 743.7 OpEx (incl. D&A) 587.6 99.4 78.6-9.2 % + 3.5 % 102.9 86.0 2014 2015 675.2 m /TEU /TEU m - 3.9 % + 9.5 % 2014 2015 564.5 m /TEU /TEU m Revenue decrease mainly due to a decline in volumes esp. Russian and Asian traffic and lower storage fees compared to 2014 Average revenue per TEU up due to change in cargo mix and lower feeder ratio of 22.9 % (previous year: 25.6 %) Operating expenses were only slightly below previous year and could not be reduced in proportion to lower throughput volumes Unit cost substantially affected by fixed costs and uneven volume flows over the course of a week, but still offset by approx. 30 % short term EBIT 156.1 20.9-29.1 % - 19.2 % 16.9 2014 2015 110.6 EBIT significantly down due to lower volumes and lower utilisation EBIT margin down to 16.4 % (previous year: 21.0 %) m /TEU /TEU m 26
Container Throughput at Terminals in Hamburg By regions for terminals of HHLA 2015 vs. 2014 Appendix North / Latin America + 3.6 % Scandinavia - 13.0 % Russia - 36.1 % Far East - 17.8 % Other Baltics - 23.2 % Rest of the world + 6.7 % Seaside throughput 2015: 6.3 million TEU ULCV Feeder HHLA market share in container throughput in the port of Hamburg: 2015: 72.7 % 27
Intermodal Segment Financial year 2015 Appendix Revenues + 3.6 % 351.5 364.0 2014 2015 Revenue growth above volume trend due to changes in the route mix and a rise in the average transportation distance m m OpEx (incl. D&A) 2014 2015-4.7 % 324.2 308.8 m m Set-up and roll-out of own traction led to further productivity gains and a significantly improved cost structure A well balanced mix of import and export flows associated with a high train utilization also contributed to the positive development EBIT 2014 2015 + 101.9 % 55.2 27.3 15.2% EBIT margin 7.8% m m EBIT significantly outperformed volume and revenue growth mainly due to the extension of own traction and improved cost structure EBIT includes 4.3 million from the sale of a land plot and equipment EBIT margin almost doubled (+ 7.4 pp) 28
Logistics Segment Financial year 2015 Appendix Revenues - 0.4 % 65.4 65.1 2014 2015 Revenue on previous year s level (consolidated activities) Revenue gains in project and contract logistics as well as in consulting activities m m Vehicle and cruise logistics below previous year EBIT m m -0,7-0.8-26.1 % 2014 2015 EBIT includes extraordinary items; comparability of figures is therefore limited Acquisition of assets by vehicle logistics from Holding/Others improved the cost structure within the segment Earnings from associated companies (using the equity method) 4.3-30.2 % 3.0 m m 2014 2015 At-equity companies succeeded in raising volumes, revenues and operational result; however, due to a change in disclosed taxes, earnings from associates were below last year Pro-forma-EBIT* demonstrated a positive development (+ 15.5 %) * Pro-forma-EBIT: sum of consolidated and at-equity (pro rata) reported activities 29
Earnings Bridge 2015 Appendix Net profit and EPS of the Subgroup Port Logistics increased substantially in million 141.1 3.7 20.1 8.0 28.6 EPS 0.84 + 12.8 % 29.2 58.9-9.3 % At-equity earnings down by 29.1 % Net financial result up by 30.9 % Declining F/X-effect (UAH devaluation) y-o-y Effective tax rate of 24.5% down by 6.1 pp Minorities down by 7.8 % + 12.8 % EBIT At-equity earnings Net interest income F/X effect Tax Minorities Net profit 30
Key Performance Indicators 2015 Solid financial fundament Appendix Profit after tax and minorities & EPS in million Ø Capital employed & ROCE in million 52.3 58.9 1.146 1.134 0.75 0.84 Profit after tax and minorities EPS 13.6 % 12.4 % Ø capital employed ROCE 2014 2015 2014 2015 Operating cash flow & operating cash flow per share in million Net financial debt & net financial debt / EBITDA in million 218.4 186.8 106.2 149.3 3.12 2.67 Operating cash flow Operating cash flow per share 0.4x 0.6x Net financial debt Net financial debt / EBITDA 2014 2015 2014 2015 31
Appendix Significantly Higher Dividend y-o-y Dividend proposal: 59 -Cent per A class share Development of dividend per share and payout ratio in, % + 13.5 % 70 % 0.45 + 15.6 % 0.52 70 % 0.59* 70 % Payout ratio proposal of 70 % of the relevant net income for A class shares in 2015 within the communicated corridor, in place since 2007 Renewed double digit increase of the dividend per A class share 65 % 50 % 2013 2014 2015 Dividend per share Payout ratio *Dividend proposal 32
Financial Strengths Solid financial fundament for further development Business Development Q1/2016 EBIT margin Generating of an above-average double-digit EBIT margin Value Continuously earning a premium on long-term capital cost assumption of 8.5 % p.a. Balance sheet Long-term debt profile with low gearing ratio and equity ratio of approx. 30 % Cash Stable positive free cash and liquidity reserves of more than 200 million Payout ratio Stable income-based dividend distribution policy between 50 and 70 % of the net profit in place since IPO (2007) 33
Key Figures Financial Statement of the Port Logistics subgroup Appendix in million 2012* 2013 2014 2015 Revenues 1,101.2 1,110.1 1,171.2 1,111.0 EBIT 172.8* 140.2 155.6 141.1 Profit after tax and minority interests 66.4* 48.3 52.3 58.9 Earnings per share in 0.95* 0.69 0.75 0.84 ROCE in % 14.3 11.8 13.6 12.4 Free Cash Flow 45.6 82.9 127.9 57.4 Capex** 186.2 100.1 114.4 144.6 Restated figures: 2012 from application of IAS 19 (revised 2011) / 2013 from application of IFRS 11 * incl. one-off gain of 17.6 million due to realignment of Intermodal segment ** without Group internal transaction 34
Key Figures Container segment Appendix in million 2012 2013 2014 2015 Container throughput in TTEU 7,183 7,500 7,480 6,561 Revenues 697.5 713.6 743.7 675.2 EBITDA 234.6 225.3 247.1 195.8 EBITDA margin in % 33.6 31.6 33.2 29.0 EBIT 145.9 137.0 156.1 110.6 EBIT margin in % 20.9 19.2 21.0 16.4 Segment assets 933.1 923.1 857.7 806.6 Restated figures: 2012 from application of IAS 19 (revised 2011) / 2013 from application of IFRS 11 35
Key Figures Intermodal Segment Appendix in million 2012* 2013 2014 2015 Container transport in TTEU 993** 1,172 1,283 1,318 Revenues 299.7 314.5 351.5 364.0 EBITDA 59.5* 43.9 47.8 78.8 EBITDA margin in % 19.8* 13.9 13.6 21.7 EBIT 41.3* 22.8 27.3 55.2 EBIT margin in % 13.8* 7.3 7.8 15.2 Segment assets 284.6 297.0 329.6 375.2 Restated figures: 2012 from application of IAS 19 (revised 2011) / 2013 from application of IFRS 11 * incl. one-off gain of 17.6 million due to realignment of Intermodal segment ** container transport from continued activities 36
Key Figures Logistics Segment Appendix in million 2012 2013 2014 2015 Revenues 91.9 72.4 65.4 65.1 EBITDA 8.0 4.0 0.5 4.6 EBITDA margin in % 8.8 5.6 0.8 7.0 EBIT 4.3 3.0-0.7-0.8 EBIT margin in % 4.7 4.1-1.0-1.3 Earnings from associated companies (using the equity method) --- 2.7 4.3 3.0 Segment assets 53.8 25.1 22.9 48.4 Restated figures: 2012 from application of IAS 19 (revised 2011) / 2013 from application of IFRS 11 37
2015: Investments Ship size driven investments and enhancing of value added Appendix Container 61.0 million Intermodal 77.2 million Additional handling equipment Ship size driven investments New storage capacities Own multi-system locomotives Own wagons Own hinterland terminals Investment Split 144.6 million Capex vs. Depreciation & Amortisation Other 4% in million Total investments Depreciation & Amortisation Intermodal 53% Container 42% 114.4 120.6 144.6 120.1 2014 2015 38
Growth of Global Container Throughput and GDP Growth multiplier on GDP slowed down Company Profile and Strategy Upswing Dip Recovery New Normal Expectation 20% Ø multiple 2.8x 7.3x 2.5x 1.2x ~ 1.0x 15% 10% 5% 0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 [F'cast] 2017 [F'cast] 2018 [F'cast] 2019 [F'cast] -5% -10% Global container throughput Global GDP Source: Drewry, IMF 39
Ports remain an attractive growth industry Company Profile and Strategy After above average growth dynamics a new momentum has established in TEU million 800 Global thereof Asia thereof Northwest Europe Source: Drewry, HHLA Upswing Dip Recovery New Normal Expectation 700 600 500 400 300 200 100 0 2001 2003 2005 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 [F'cast] 2017 [F'cast] 2018 [F'cast] CAGR Global Asia NW Europe 12.3% -9.3% 11.8% 4.0% 3 4 % 14.1% -7.9% 13.4% 4.4% 4 5 % 9.7% -17.1% 6.4% 1.5% 2 3 % 40
Deviations in ship calls per week Peak loads due to bigger ship sizes in a new normal environment 2007/08 2015 Carrying capacity of container ships roughly doubled since 2007/08 Company Profile and Strategy max. ~ 9,000 TEU max. ~ 18,000 TEU Weekly Path of HHLA Throughput Volumes Index (100 = Ø weekly) 120% 110% 100% 90% 80% 70% standard deviation: 2007/08: 8.1% 2015 : 13.3% (+ 64.1% vs. 2007/08) 37 % 26 % Mo Tu Wed Thu Fr Sa Su High High weekly average Low Low In 2007/08 load conditions with homogeneous distribution of weekly throughput volumes Nowadays weekly peak load conditions as well as underutilisation has almost doubled Spread between highest and lowest utilization is roughly 50% higher compared to 2007/08 2015 2007/08 41
Appendix Growth in Ship Sizes Handling of ultra large container vessels (ULCV) require extra effort Ship size development at HHLA container terminals 2010 2015 59% 39% 34% 21% Fourfold increase of ULCV calls within five years 40% ULCV fleet worldwide and order book until 2017 in service on order 200 +65 265 +63 328 +57 385 More than doubling of fleet within three years +55 440 7% < 6,000 TEU 6,000 to 10,000 TEU > 10,000 TEU 2013 2014 2015 2016 2017 Source: AXL Alphaliner, June 2015 Implications Nautical restrictions tightened by increasing number of ULCV because of more width and draught Peak load conditions due to narrower time windows require more staff and equipment Capex requirements (suitable quay walls, gantry cranes etc.) Counteraction Enhancing service quality by continuous investment in technology and efficiency Launching Feeder Logistics Centre (FLZ) and Nautical Terminal Coordination (NTK) to optimise ULCV and feeder vessel calls Raising attractiveness of HHLA terminals by expanding hinterland network 42
Development of Alliances in Container Shipping Concentration in the shipping industry substantially increased Appendix 2015 Shipping Lines 2017 2M O3 G6 C K Y H E Consolidation processes Maersk MSC CSCL CMA CGM UASC APL OOCL Hapag Lloyd NYK / MOL Hyundai M. M. Cosco Evergreen K Line Yang Ming Hanjin 2M Network Ocean Alliance subject to approval by the regulations authorities The Alliance Companies are in merger talks Share FE - Europe 35% 36% 29% Implications Consolidation process in the shipping industry is supposed to be continued Re-shaping of alliances and cooperation to improve load factor and slot costs Perspectives Deployment of largest vessel sizes and focus on calls at gateway ports (hubs) Source: AXS Alphaliner, May 2016 43
Competing Ports of the North Range Container Throughput and Market Share Development Appendix CONTAINER THROUGHPUT 2015 36.7 million TEU (- 0.5 % y-o-y) BELGIUM NORTH SEA THE NETHERLANDS WILHELMSHAVEN 0.4 million TEU (pos. y-o-y) ROTTERDAM 12.2 million TEU (- 0.5 % y-o-y) ANTWERP 9.7 million TEU (+ 7.5 % y-o-y) BREMEN PORTS 5.6 million TEU (- 4.3 % y-o-y) GERMANY DENMARK KIEL CANAL HAMBURG 8.8 million TEU (- 9.3 % y-o-y) HHLA in Hamburg 6.3 million TEU (- 12.6 % y-o-y) Current terminal capacity of North Range ports** of ~ 55 million TEU p.a.*** utilisation stands at ~ 67 % *** CAGR: 2008-2015 *** North Range Ports (Rotterdam, Hamburg, Bremen ports, Antwerp) incl. Wilhelmshaven *** Source: AXS Alphaliner, own estimates 2015: Throughput and market share of HHLA in million TEU 36.7 17.4% 14.8 8.8 6.3 North Range German Bay Hamburg HHLA CAGR* 0.8% 34.6 19.8% 43.2% CAGR* - 0.4% 15.2 45.2% 72.7% CAGR* - 1.4% 2008: Throughput and market share of HHLA in million TEU 9.7 70.4% CAGR* - 1.0% 6.9 North Range German Bay Hamburg HHLA 44
Short Ways Less Costs Appendix Hamburgs location offers cost benefits compared to other Nord Range ports Shanghai <> Hamburg (one-way: ~ 20,375 km) + 70 % of costs for about 97 % of total distance No differentiation in freight rates between North Range ports Hamburg <> Prague (one-way: ~ 690 km) + 30 % of costs for about 3 % of total distance Clear differentiation between North Range ports 45
State-of-the-Art Container Handling at CTA Maximum efficiency by high degree of automation and compact layout Appendix 46
Strengthening hinterland network with own assets Well located inland hub terminals offer high level of value added services Appendix 47
HHLA in the Port of Hamburg Appendix HHLA CONTAINER TERMINAL BURCHARDKAI HHLA REAL ESTATE FISCHMARKT HHLA CONTAINER TERMINAL TOLLERORT HHLA REAL ESTATE SPEICHERSTADT HHLA LOGISTICS CRUISE CENTER HHLA LOGISTICS ÜBERSEE-ZENTRUM HHLA LOGISTICS O SWALDKAI HHLA LOGISTICS HANSAPORT HHLA CONTAINER TERMINAL ALTENWERDER 48
Elbe Waterway Adjustment Administrative steps by the public authorities in charge Appendix Initiation of plan approval process Sep 2006 Final plan approval Apr 2012 Main hearings on legal objections July 2014 Proceedings stayed pending a decision by the ECJ 2 Oct 2014 ECJ judgment on the EU Water Framework Directive 1 July 2015 Submission of planning supplement decision 24 March 2016 Final ruling on the plan approval Official date has yet not been announced Federal Water and Shipping Authority & City State of Hamburg Federal Water and Shipping Authority Federal Administrative Court (FAC) European Court of Justice (ECJ) Federal Water and Shipping Authority & City State of Hamburg Federal Administrative Court (FAC) Adjustment of navigation channel 14.50 m tidal dependent / 13.50 m tidal independent, widening boxes Enabling a higher load factor, extended time slots and more flexibility for mega carriers 49
Appendix Elbe Waterway Adjustment Passing Box 50
Financial Calendar IR Contact 30 March 2016 Annual Report 2015 Press Conference, Analyst Conference Phone: +49 40 3088 3100 Fax: +49 40 3088 55 3100 12 May 2016 Interim Statement January - March 2016 Analyst Conference 16 June 2016 Annual General Meeting (AGM) 11 August 2016 Interim Report January - June 2016 Analyst Conference 10 November 2016 Interim Statement January - September 2016 Analyst Conference E-mail: Web: investor-relations@hhla.de www.hhla.de 51
HAMBURGER HAFEN UND LOGISTIK AG Investor Presentation Annual Report 2015: http://report.hhla.de/annual-report-2015 Interim Statement January to March 2016 http://report.hhla.de/interim-statement-q1-2016 52