Companhia

Strategy

The prime strategic objective of the Hapag-Lloyd Group is to achieve long-term profitable growth, measured on the basis of the developments in transport volume, the key performance indicators EBITDA and EBIT as well as the return on invested capital (ROIC).

Hapag-Lloyd is aiming for a global market share (excluding Intra-Asia) of around 10%. As at 31 December 2021, this figure was approximately 9.4% (previous year: 10.9%). Hapag-Lloyd plans to grow with the market and thereby retain its market share. In addition, it wants to expand in attractive growth markets and in the area of special cargo in particular. As part of this, the Company is continuously investing in the expansion of its reefer container fleet. The successful takeover in 2021 of its competitor NileDutch, which specialises in Africa trades, has also enabled the Company to strengthen its business in another attractive growth market.

The Group’s financial key performance indicators for its operating business are EBITDA and EBIT. EBIT is an important indicator for measuring sustainable earnings, while EBITDA is an important indicator for measuring gross cash flows, and is also used as an important key performance indicator for investment and financial decisions.

The main factors influencing the development of the operating result indicators are transport volume, freight rate, the US dollar exchange rate against the euro, and operating costs including bunker price.

As part of Strategy 2023, Hapag-Lloyd is pursuing profitability throughout the entire economic cycle. This is reflected in a suitable return on invested capital (ROIC), one that at least matches the Company’s weighted average cost of capital. The extraordinarily good earnings position in the 2021 financial year enabled the Company to exceed all of its long-term financial targets.

In 2018, Hapag-Lloyd developed and presented its medium-term strategy based on these premises. The core objectives of Strategy 2023 are:

  • Become number one for quality
  • Remain a global player
  • Profitability throughout the entire economic cycle

As a result of the market disruptions caused by the COVID-19 pandemic as well as the rapidly growing importance of sustainability aspects and increasing digitalisation, an extensive analysis of the existing strategy was conducted in the 2021 financial year. The Executive Board’s assessment is that this strategy has proven its worth and that numerous objectives have been achieved ahead of schedule. To ensure that the Company sustains its success even during difficult market phases, a greater focus will be placed on the area of quality in the next two years and the topic of sustainability will be incorporated as a fourth core objective.

To achieve the Company’s strategic objectives, a catalogue of measures was published in the 2021 financial year comprising three areas of action:

  • Simplify: Improve the customer experience and reduce complexity
  • Strengthen: Double our efforts to become the number one for quality
  • Invest: Invest in our employees, sustainable assets and long-term competitiveness

In the 2021 financial year, Hapag-Lloyd developed an enhanced sustainability strategy which encompasses three focus areas:

  • Clean shipping & futureproof propulsion
  • Diversity & society
  • Compliance und responsibility

The new sustainability strategy is further detailed in Hapag-Lloyd’s Sustainability Report 2021.

Outlook

Hapag-Lloyd posted a strong financial performance in the first nine months of 2022, which was within the expectations as adjusted in July 2022. Based on current business performance, the fourth quarter should also meet previous expectations. The Executive Board of Hapag-Lloyd AG therefore continues to expect Group EBITDA in the range of USD 19.5 to 21.5 billion and Group EBIT in the range of USD 17.5 to 19.5 billion for 2022. In euros, this corresponds to Group EBITDA in the range of EUR 18.2 to 20.1 billion and Group EBIT in the range of EUR 16.3 to 18.2 billion.

The earnings outlook for the 2022 financial year is based in particular on the assumptions that the transport volume will remain at the previous year’s level (previously: increasing slightly) while the average freight rate will increase significantly compared to the previous year. At the same time, a further increase in transport expenses is anticipated. In particular, the average bunker consumption price is expected to increase clearly. The earnings outlook assumes an average exchange rate of USD 1.07/EUR. Owing to the war in Ukraine, ongoing disruptions in the global supply chain and the effects of the COVID-19 pandemic, the forecast is subject to considerable uncertainties.

The earnings forecast does not take into account material impairments on goodwill, other intangible assets and property, plant and equipment in the course of the 2022 financial year, which are currently not expected but cannot be ruled out.
 

Key benchmark figures for the 2022 outlook Actual 2021 Forecast 2022
Global economic growth (IMF, October 2022) 6.1% 3.2%
Increase in global trade (IMF, October 2022)
10.1% 4.3%
Increase in global container transport volume
(CTS, October 2022, Seabury, August 2022)
6.6% 1.1%
Transport volume, Hapag-Lloyd
TEU 11.9 million On previous year's level
Average bunker consumption, Hapag-Lloyd USD 475/t
Increasing clearly
Average freight rate, Hapag-Lloyd USD 2,003/TEU Increasing clearly  
EBITDA (earnings before interest, taxes, depreciation and amortisation), Hapag-Lloyd EUR 10.9 billion
EUR 18.2 - 20.1 billion
EBIT (earnings before interest and taxes), Hapag-Lloyd EUR 9.3 billion
EUR 16.3 - 18.2 billion
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