[ Hamburg, Germany’s Top Port, Operating ... ]

Hamburg, Germany’s Top Port, Operating Company Asserts Lead

Following years of continuous growth in volume of cargoes handled, in
the 1996 financial year Hamburger Hafen-und Lagerhaus-Aktiengesellscha
ft proved unable to match its 1995 record. The group’s facilities ha
ndled a total of 15.936 million tonnes in 1996, reprsenting a 4.5% dec
line on the previous year’s 16.68 million tonnes.
Including HHLA cargo-handling subsidiariers in the Port of Hamburg-amo
ngst these the Cellpap Terminal Hamburg Umschlags und Transport GmbH a
cquired early in 1996-then 1996 throughput for the group totalled 19.6
03 tonnes.
The drop of 0.7% was caused entirely by a 3.1% fall in export cargoes
to 9.304 million tonnes(1995:9.6m tonnes), whereas import volume rose
from 10.134m tonnes by 1.6% to 10.229m tonnes.
This trend was especially apparent on container handling, the sector w
hich has powered our growth in recent years.
In the year under review throughput at our facilities totalled 1,667,6
97 TEU(17.184m tonnes), as against 1,740,148 TEU(18.007m tonnes) in 19
95. The degree of containerization for the HHLA Group is now approxim
ately 88%.
By contrast, HHLA successed in boosting its market share of all contai
ner handling in the Port of Hamburg. Including the volume of Gerd Bus
s Lager-und Speditionsgesellschaft(acquired on 01.07. 1997 and meanwhi
le renamed TCT Tollerort Container-Terminal GmbH), in the second half
of the year our share of this market segment in Hamburg rose to 62%(19
95:60.2%).
We also boosted throughput at HHLA Fruit Centre in 1996. Of altogethe
r nearly 850,000 tonnes of fruit handled in the Port of Hamburg in 199
6 828,000 tonnes was handled by our advanced facility located on O’Sw
aldkai.
On conventional cargoes, throughput of 236,000 tonnes in the year unde
r review(1995:309,000 tonnes) represented a continuation of the genera
l downward trend also affecting HHLA.
HHLA’s returns on handling for the financial year 1996 totalled DM 42
8.8m and were thus 6.5% down on the previous year’s DM 458.3m. This
fall reflected not just the shortfall in cargo handled, but also susta
ined pressure on rates caused by stiff competition between ports in th
e north continent range.
We only partly managed to offset this considerable fall in revenues on
the costs side, and a repetition of the previous year’s record resul
ts accordingly proved impossible. Following a DM 10m(1995:DM 33.4m) a
llocation to pension reserves, we nevertheless achieved a surplus on t
he year of DM 0.1m(1995:DM 1.3m).
Contributing to this result was the maintenance in the year under revi
ew of priority measures to cut costs and to boost productivity, and al
so profit contributions and distributions from our subsidiaries and ho
ldings.
Rooted in the quite distant past, our duty to provide old age assistan
ce for former staff members remains a special burden on the group. Fo
r example, in 1996 alone our cash expenditure on company pensions tota
lled DM 21.9m. This sum included DM 17.3m in inherited obligations in
volving what is known “occupational pension expenditure not customary
in the port”. If DM 10m allocated to pensions reserves is included,
in the year under review alone our spending on old age provision thus
amounted to DM 31.9m, all of which had to be earned.
In the 1996 financial year HHLA invested DM 63,6m in intangible and fi
xed assets. Investments during the previous year had totalled DM 114.
1m, of which no less than DM 65.2m had been required for acquiring exp
ired usage rights in a number of buildings and plots owned by the Free
and Hanseatic City of Hamburg in the waterfront handling and warehous
ing areas.
As in the previous year, in 1996 the bulk of our total investments(ca.
DM 33m) was concentrated at our Container Terminal Burchardkai. To en
able this facility to cater for constantly growing demands in containe
r traffic, amongst the items purchased were six new straddle carriers
and one new postpanamax container gantry. In addition, substantial su
ms were invested in expanding the VC location system and improving the
data radio system. Investments at Burchardkai were rounded off by co
nstructing a new central canteen and some rebuilding work on the offic
es.
HHLA invested an additional DM 7m in modernizing and rebuilding certai
n blocks in warehouse city, in expending refrigerated premises at O’S
waldkai and in extending EDP system. In the year under review nearly
all HHLA subsidiaries and holdings made considerable contributions to
the overall result, once again thus largely fulfilling one aspect of
our strategic goals. In addition, howover, the policy behind our hold
ings aims to supplement HHLA’s core business by providing auxiliary s
ervices and thus underpinning this in the long term. The broad range
of such services is reflected in the market segments-port cargo handli
ng and closely related services,-consultancy,-propety in the port, and
-rail transport.
For the current year, sustained globalization may be assumed, and henc
e further expansion in world trade. At the same time German exports h
ave risen considerably in the wake of the stronger US dollar.
Hamburg will be profiting both from continued growth momentum in the F
ar East and South America and also from its strong position as the hub
for transit traffic with Scandinavia and Eastern and Southern Europe.
Against this background, HHLA expects to follow volume losses in 1996
with a renewed increase in throughput at its facilities, and especiall
y growth in container traffic. Amongst the factors behind these expec
tations are the commencement before the end of this year of the deepen
ing of the River Elbe, on which significant procedural and political d
ecisions were reached in 1996.
Not least, further strengthening of hinterland links will contribute t
owards channelling traffic flows to Hamburg and hence to HHLA. Pressu
re on rates arising from stiff competition between north continent por
ts will be maintained, whilst distortions of fair competition caused b
y the payment of subsidies-by no means in conformity with EU rules- at
other North Sea ports is proving an additional handicap for Hamburg a
nd HHLA.
Even if the volume trend stabilizes during 1997, returns on turnover w
ill scarely keep pace with this trend. The absolutely essential impro
vement in HHLA results will accordingly only prove attainable by pursu
ing further rationalization, by maintaining our rigorous costs managem
ent and by increasing flexiblity in working hours.