Slide 1: Investor Presentation FY 2020 Results
Investor Presentation FY 2020 Results Hamburg, 18 March 2021
Slide 2: Opening Remarks
Opening Remarks The year 2020 was characterized by major fluctuations on the demand side 1 Current developments Performance of container shipping market in H2 much better than initially anticipated Freight rate development mainly driven by strong consumer demand, but also operational challenges Stra
Slide 3: Pandemic has led to the biggest operational challenge in many years
1 Current developments The coronavirus pandemic has lead to the biggest ‘operational challenge’ our industry has seen in many years … Demand explosion in H2 2020, spilling over into 2021 In our industry Terminals and Inland transport are there are 3 the main bottleneck specific causes Container shor
Slide 4: 2020 was a very unusual year with strongly fluctuating demand
1 Current developments … as 2020 was a very unusual year, characterized by strongly fluctuating demand that recovered unexpectedly quick in H2 2020 … Monthly transport volume growth in 2020 [YoY] Idle fleet [TTEU] 3,000 Share of world fleet 2.9%2) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2,50
Slide 5: Operational challenges, capacity constraints, higher freight rates and costs
1 Current developments … leading to significant operational challenges, capacity constraints, higher freight rates and higher costs … Operational challenges Increasing Container Average voyage Port congestions Containership Timecharter Index1) usage time [days] delay [days] Record container volumes
Slide 6: Broad range of countermeasures to assist our customers
1 Current developments … and therefore we have implemented a broad range of countermeasures to assist our customers OUR CUSTOMERS OUR FLEET OUR NETWORK We are continuously striving to All our vessels are in use and fully We moved capacity to high- optimize scarce equipment utilized with basica
Slide 7: Quality promises and QP-dashboard launched
2 Strategic Highlights We have launched the first 5 quality promises and our QP-dashboard, and we will launch the remaining ones until the end of 2021 … Timely and Accurate Booked and Fast Issue Responsive Reliable Documentation Loaded as Agreed Resolution Service Transport Timely and correct Bill o
Slide 8: Six LNG powered vessels of 23,500+ TEU ordered
2 Strategic Highlights … we have ordered six LNG powered vessels of 23,500+ TEU to improve the efficiency of our fleet and to reduce our carbon footprint… Vessel delivery schedule post signing and building phase Dec-20 Apr-23 Jun-23 Aug-23 Sep-23 Nov-23 Building supervision Contract signing Delivery
Slide 9: Green financings of USD ~900 m concluded
2 Strategic Highlights … and concluded green financings in an amount of USD ~900 m Hapag-Lloyd developed a Green Financing Framework Two debut transactions according to the Green Loan Principles of the Loan Market Association (LMA) Syndicated green loan (USD 417 m) will finance 3 vessels with
Slide 10: Steady progress on our Strategy 2023
2 Strategic Highlights We have made steady progress on our Strategy 2023… Established new Quality Service Set up services: MIAX Middle Centers in Mauritius and East Africa Express; Europe IEX India Europe Express & CKX China Kenya Express Opened new offices in Ghana, Nigeria & Kenya Knowledge Built
Slide 11: SPA signed with NileDutch
2 Strategic Highlights …and just signed a SPA with NileDutch yesterday – a good strategic fit to further strengthen our presence in Africa Extended network after the acquisition of NileDutch Europe Europe Casablanca NileDutch Clear focus on connecting West and Nouakchott South Africa with Asia, Eu
Slide 12: Improved profitability, strengthened balance sheet, earned cost of capital
3 Financials We were able to improve profitability, strengthen our balance sheet, and earned our cost of capital in 2020 Operational KPIs P&L effects Volume 11,838 Volume declined by 1.6% YoY due to COVID-19 Revenue FY revenue increased slightly (3.3% YoY) mainly 14,577 impact on almost all trades d
Slide 13: Results improved strongly on PSP measures, higher freight rates, lower bunker prices
3 Financials Results improved strongly on the back of successful PSP measures, higher freight rates and lower bunker prices Revenue [USD m] EBITDA [USD m] +3.3% 15.2% 25.6% Margin 15.7% 21.1% 14,577 +38.6% +17.1% 14,115 3,082 4,052 +97.5% 2,223 3,460 1,038 526 Q4 2019 Q4 2020 FY 2019 FY 2020 Q4 2019
Slide 14: Transport volume development by trade
3 Financials After volumes have decreased strongly in Q2, we have seen a strong recovery from Q3 onwards – Q4 volumes were up almost 4% YoY Transport volume development by trade Q1 2019 – Q4 2020 [TTEU] FY 2019 FY 2020 12,037 - 1.6 % 11,838 3.8 % 3,142 3,038 3,045 3,026 3,053 2,929 2,942 2,701 468 5
Slide 15: Freight rates increased 4% YoY despite falling oil prices
3 Financials Freight rates increased 4% YoY in spite of falling oil prices – Q4 spot rate surge is not fully reflected in the results yet Freight rate [USD/TEU] vs. Bunker price development [USD/mt] FY 2019 FY 2020 Average freight rate 1,072 + 4.0% 1,115 + 9.5% 1,163 1,114 1,094 1,079 1,084 1,084 1,
Slide 16: Unit cost remained flat due to agile cost management
3 Financials In spite of high volume swings, unit cost remained flat due to agile cost management under PSP Transport expenses per unit [USD/TEU] FY 2019 1,012 PSP measures have helped to reduce ex bunker unit cost in spite of lower Bunker -16 volumes In addition, costs for “Vessel and Handling -3 v
Slide 17: Free Cash Flow of USD 2.8 bn used to pay down debt
3 Financials Strong Free Cash Flow of USD 2.8 bn was mainly used to pay down financial debt Cash flow FY 2020 [USD m] Operating Investing Financing cash flow cash flow cash flow 3,307.3 -545.1 -2.500.1 1,819 225 -610 -3,130 35 29 3,082 -587 1,421 1,159 -231 -30 585 585 -360 Free cash flow = USD 2,76
Slide 18: Continuously improved financial KPIs
3 Financials Over the past years we have continuously improved our financial KPIs… EBITDA [USD m] Free cash flow [USD m] Operating EBITDA 1,199 1,345 2,223 3,082 1,020 1,268 2,270 3,307 IFRS 16 IFRS 16 cash flow 21.1% 2,762 15.8% 1,857 10.6% 9.9% 1,048 1,146 EBITDA Free Margin cash flow 2017 2018 20
Slide 19: Further strengthened our balance sheet
3 Financials …and further strengthened our balance sheet Equity base [USD m] Financial debt [USD m] Equity 40.9% 40.9% 40.9% 44.3% Cash 725 752 574 836 IFRS 16 IFRS 16 ratio 8,253 7,596 7,263 7,168 7,430 6,891 7,180 Leasing 6,305 1,339 liabilities 1,719 Equity Financial 5,840 debt 4,586 2017 2018 20
Slide 20: Proposed dividend of EUR 3.50 per share
3 Financials Based on the strong result in 2020, we propose a dividend of EUR 3.50 per share, while maintaining a prudent financial policy EPS1) [EUR/share] Dividend policy 5.27 In general, we intend to distribute at least 30 % of the consolidated profit (IFRS) On the basis of the strong result in 2
Slide 21: Market fundamentals remain favorable in the mid-term
4 Way forward Market fundamentals remain favorable in the mid-term – Supply and Demand are expected to be fairly balanced in 2021/2022 Global orderbook Orderbook Supply / Demand balance Supply growth for [TEU m, %] 2021e & 2022e Share of world fleet Demand Supply excluding scrapping 56% 47% 4.5% 5.6
Slide 22: Strong earnings growth expected in 2021
4 Way forward Thanks to ongoing exceptionally strong demand for container transports, we expect a strong earnings growth in 2021 Guidance for FY 2020 FY 2021 Transport volume 11,838 TTEU Increasing slightly Bunker 379 USD/mt Increasing clearly consumption price Guidance for Freight rate 1,115 USD/TE
Slide 23: Our focus for 2021 and beyond
4 Way forward Our focus for 2021 and beyond: Prepare for a Deliver on our Focus on our seamless integration Strategy 2023 customers’ needs of NileDutch Continue to follow a Consider selective Reduce our prudent financial investment CO2 footprint policy opportunities 23
Slide 24: Appendix
€€ Hapag-Lloyd Appendix
Slide 25: Equity ratio of 44.3% and gearing of 66.3%
A Appendix Hapag-Lloyd with an equity ratio of 44.3% and a gearing of 66.3% Balance sheet [USD m] Financial position [USD m] million USD 31.12.2020 31.12.2019 million USD 31.12.2020 31.12.2019 Assets Financial debt and lease liabilities 6,305.1 7,179.6 Non-current assets 15,508.3 15,501.0 Cash and c
Slide 26: Positive EBIT of USD 1,501 m in FY 2020
A Appendix Hapag-Lloyd with positive EBIT of USD 1,501 m in FY 2020 Income statement [USD m] QoQ YoY million USD Q4 2020 Q3 2020 Q4 2019 Change change FY 2020 FY 2019 Change Revenue 4,052.5 3,519.4 3,460.4 15.1% 17.1% 14,577.1 14,114.5 3.3% Transport expenses –2,735.7 –2,486.1 –2,679.6 10.0% 2.1% –1
Slide 27: Equity ratio of 44.3% and gearing of 66.3% (EUR)
A Appendix Hapag-Lloyd with an equity ratio of 44.3% and a gearing of 66.3% Balance sheet [million EUR] Financial position [million EUR] million EUR 31.12.2020 31.12.2019 million EUR 31.12.2020 31.12.2019 Assets Financial debt and lease liabilities 5,136.2 6,397.2 Non-current assets 12,633.0 13,811.
Slide 28: Positive EBIT of EUR million in FY 2020
A Appendix Hapag-Lloyd with positive EBIT of 935 million EUR in FY 2020 Income statement [million EUR] million EUR FY 2020 FY 2019 Change Revenue 12,772.4 12,607.9 1.3% Transport expenses –9,140.2 –9,707.0 –5.8% Personnel expenses –683.0 –682.5 0.1% Depreciation, amortisation and impairment –1,385.2
Slide 29: Interest burden clearly reduced
A Appendix Interest burden clearly reduced – extraordinary valuation effects weigh on financial result Extraordinary interest result items [USD m] The interest result has significantly improved in 2020 This was driven by substantial deleveraging efforts Additionally, a lower USD interest environment
Slide 30: Secured and unsecured debt reduced by USD 1.3 bn
A Appendix Secured and unsecured debt reduced by USD 1.3 bn – IFRS 16 debt increased due to “less for longer” vessel charter renewals Debt reduction1) [USD m] -863 7.202 -791 1.270 229 -17 -137 6.339 -548 400 1.670 IFRS 16 1.130 -685 USD m 445 Unsecured debt 4.802 Secured Debt -578 USD m 4.224 Debt
Slide 31: Well balanced maturity structure of financial liabilities
A Appendix Well balanced maturity structure of financial liabilities Financial Debt Profile as per 31 December 20201), [USD m] 1,527 Facility 31 December 2020 [USD m] Liabilities to banks Liabilities from lease and charter contracts Vessel Financings 2,541 Bonds Other financial liabilities Container
Slide 32: Outlook & sensitivities
A Appendix Outlook & sensitivities Hapag-Lloyd sensitivities for 2020 Market forecasts for 2021 Transport volume +/- 100 TTEU +/- USD ~0.1 bn Global economic growth (IMF, Jan 2021) 5.5% Bunker price +/- 50 USD/mt +/- USD ~0.3 bn Increase in global trade (IMF, Jan 2021) 8.1% Increase in global contai
Slide 33: Hapag-Lloyd's shareholder structure
A Appendix Hapag-Lloyd`s shareholder structure Shareholders‘ agreement/ Controlling shareholders 3.6% Kühne Maritime GmbH / Kühne Holding AG 10.2% CSAV Germany Container Holding GmbH HGV Hamburger Gesellschaft für Vermögens- und Beteiligungsmanagement mbH 30.0% Qatar Holding Germany GmbH The Public
Slide 34: Share price development
A Appendix Share price development Performance since 1 January 2018 Indexed Price Frankfurt Stock Exchange / 600 Stock Exchange Hamburg Stock Exchange 500 Regulated market Market segment (Prime Standard) 400 ISIN / WKN DE000HLAG475 / HLAG47 300 Ticker Symbol HLAG 200 Nov/16 100 Primary listing 6 Nov
Slide 35: Bond trading
A Appendix Bond trading 110 103.0 100 Impacted by general uncertainty in the 90 financial markets 80 70 HL EUR 6.75 % 2022 HL EUR 5.125% 2024 EUR Bond 2024 EUR Bond 2022 Listing Open market of the Luxembourg Stock Exchange (Euro MTF) Volume EUR 300 m EUR 450 m ISIN / WKN XS1645113322 XS1555576641 /
Slide 36: Financial Calendar 2021
Financial Calendar 2021 27 January 2021 Preliminary Financials 2020 18 March 2021 Annual Report 2020 12 May 2021 Quarterly Financial Report Q1 2021 28 May 2021 (virtual) Annual General Meeting 2021 12 August 2021 Half-year Financial Report 2021 12 November 2021 Quarterly Financial Report 9M 2021 36
Slide 37: Disclaimer
Disclaimer Forward-looking statements This presentation contains forward-looking statements that involve a number of risks and uncertainties. Such statements are based on a number of assumptions, estimates, projections or plans that are inherently subject to significant risks, as well as uncertainti
Slide 38: Hapag-Lloyd Investor Relations
Hapag-Lloyd Investor Relations Ballindamm 25 20095 Hamburg Tel: +49 (40) 3001-2896 ir@hlag.com All publication documents can be found here: https://www.hapag-lloyd.com/en/ir.html 38