Hapag-Lloyd expects earnings before interest and taxes (EBIT) of up to 18.2 billion euros for 2022, probably by far the highest profit that a Hamburg company has ever achieved. For the second year in a row, Hapag-Lloyd is benefiting from the logistical disruptions caused by the pandemic. In his office on Ballindamm, CEO Rolf Habben Jansen (56) told WELT AM SONNTAG what the flood of money means for Germany’s largest shipping company, in which the city of Hamburg has a 13.9 percent stake.
WORLD: Mr. Habben Jansen, you have raised your annual forecast to between 16.3 and 18.2 billion euros in operating profit. How do you like this sum?
Rolf Habben Jansen: We have had a very unusual situation in our industry since 2020, mainly due to the consequences of the pandemic. This has been a situation for two and a half years that we will probably never experience again. I am glad that the situation is gradually returning to normal, because ultimately it is in our interest too. Container shipping has developed so well over the decades because it is the cheapest form of freight transport – and it should remain so when this state of emergency is over.
WORLD: Why do you think your industry will soon be back to normal?
Habben Jansen: Six months ago, each of our ships was three or four times overbooked, now the ships are maybe 20 percent overbooked. This is an essential indicator. The return times for the empty containers are also getting shorter. At the height of the crisis in the transport chains, it took 68 days; it is currently 60 or 61 days. And the situation in the ports continues to ease, from the west coast of the USA to Asia to South America. Disability factors remain in certain ports, such as work stoppages in collective bargaining. But that will resolve.
WORLD: Hapag-Lloyd has already greatly reduced its debt in recent years. The net profit, which is also the benchmark for the distribution of the dividend, is therefore likely to be close to the level of the operating profit.
Habben Jansen: Yes, we have recently reduced our debt significantly and interest rates are low. Therefore we will have a high net profit and then plan to pay out as part of our dividend policy. But we will also continue to invest in our workforce, in sustainability, in one or the other new ship and in smaller acquisitions.
WORLD: In Europe, “excess profit taxes” are being discussed specifically for the energy industry and some have already been introduced. Do you fear such a tax given the huge profits in container shipping? Hapag-Lloyd paid only around 61 million euros in tonnage tax for 2021, with a net profit of around nine billion euros.
Habben Jansen: I can understand this debate very well. In shipping, the tonnage tax, the flat-rate taxation of the tonnage used, has worked very well for many years, even in the past few years of a severe shipping crisis, one should not forget that. A decade ago, even with the tonnage tax, the industry paid 20 to 30 percent of its net profits in taxes. In the current phase, the tonnage tax rate is of course very low, it’s fair to say that. But firstly, this phase will not last much longer, and secondly, if you want to change something, then you have to say clearly how it can and should be done at an international level. Shipping is the most international industry of all. And changing this tax system is not easy. But it is understandable that the subject should come up in extraordinary years like these. You have to talk to politicians about this and find out what adjustments are needed – but this must be done with equal treatment for our industry as a whole.
WORLD: Will you pay off debt faster with your profit this year?
Habben Jansen: I don’t think so, because outside capital is known to be cheaper than equity. So it would not necessarily be an advantage to quickly reduce financial debt to zero. We have also ordered a total of 22 new ships, most of which we still have to pay for. Overall, we invest a lot in new technologies and processes.
WORLD: Do you have container terminals in mind when making acquisitions?
Habben Jansen: For us, the priorities are the modernization of the fleet and greater sustainability of all processes in the company, especially from the point of view of climate protection. And we will continue to look at one or another terminal. We have learned in recent years that it can be advantageous to have some influence on the infrastructure when handling your own ships. Our experiences with HHLA’s Altenwerder container terminal in Hamburg, in which we have a stake, and with our stake in Eurogate’s Tanger Med terminal on the Mediterranean, have been very positive. We recently invested in the terminal at JadeWeserPort in Wilhelmshaven and decided to build a new building together with Eurogate in Damietta, Egypt. A lot could be added to this series.
WORLD: Why don’t you start a discussion about whether Hapag-Lloyd could take over significant shares in HHLA from the city of Hamburg? With the terminals and the rail transport company Metrans of HHLA, you could create an integrated maritime group. Do you have such scenarios?
Habben Jansen: Not necessarily ones, with a combination of Hapag-Lloyd and HHLA. But of course we want to find out how Hapag-Lloyd is well positioned in the long term. On the one hand, this involves activities in the container liner service, but that is precisely why we are also looking at the port terminal business. And there is some thinking about what we could do, albeit not in the way you suggested.
WORLD: Your main competitors, the leading liner shipping companies Mærsk and CMA CGM, are investing in takeovers to control larger parts of the transport chain – for example by taking over air freight companies.
Habben Jansen: Mærsk and CMA CGM actually got into logistics with acquisitions in the air freight and warehousing business. We would rather not do that. When it comes to takeovers or investments in general, that would be closer to Hapag-Lloyd’s core maritime business, i.e. with a view to port terminals. The so-called intermodal business in the ports is also interesting for us, i.e. the interface between means of transport such as seagoing vessels, inland waterways vessels, trains and trucks. In the USA, for example, we have many long-term contracts with CP Railway or with Norfolk Southern Railway. This can possibly be expanded without us necessarily having to be the owner.
WORLD: Do you want to increase your fleet?
Habben Jansen: We want to grow with the market, not significantly beyond it. In five years, however, we will have more larger and more environmentally friendly ships than today. Because the larger ships are more efficient and cheaper to operate. We want to help ensure that container shipping remains the most attractive means of transport in terms of price.
WORLD: The discussion about at least partial de-globalization is getting louder because of the Ukraine war and the growing tensions between China and Taiwan. Such a development could also affect your core business, sea transport between the Far East and Europe.
Habben Jansen: For the moment I don’t see any real de-globalisation. Due to globalization, prosperity has developed very strongly worldwide. Hundreds of millions of people are better off today than they used to be. Above all, countries like India or the African continent need globalized trade in order to be able to develop further. We sometimes discuss something like “de-globalization” in Europe from a rather luxurious position. If you “de-globalize” the economy, costs and prices will rise worldwide, even in the economically weaker countries. That would be a major step backwards for a great many countries and people. I believe that in the long run globalization is needed to supply a large and growing world population with goods.
WORLD: You have taken over the shipping companies Nile Dutch and German Africa Lines since the summer of 2021. Do you see Africa as the continent with the greatest potential for Hapag-Lloyd?
Habben Jansen: Overall, Africa has a lot of potential in the coming decades. That is why we have strengthened our position in Africa with organic growth and on top of that with these two acquisitions. But India, for example, will also develop very strongly.
WORLD: You said in early summer that container liner shipping would face a “container glut” as soon as the situation in the transport chains normalized. Do you still see it that way?
Habben Jansen: If the situation normalizes, we will need a volume of around 2.5 million container units – TEU – for our current transport volume, but we currently have a container fleet of 3.1 million TEU, 600,000 TEU more. The excess containers will have to be stored somewhere in the future so that we can then gradually renew our inventory. From today’s perspective, we will not buy any more containers in the coming years.
WORLD: Although Hapag-Lloyd is going through what is perhaps the strongest phase in its history, you cannot fill all of your apprenticeship positions in Germany. Does a company like yours have to worry about the shortage of skilled workers?
Habben Jansen: It’s certainly not a huge problem for us because we’re also very well positioned internationally. For example, we bring people from abroad to Germany or, if necessary, we can relocate activities from here to other locations. However, it is difficult for us at the moment to find sufficient specialists in information technology.
WORLD: HHLA and Eurogate have officially interrupted their talks about closer cooperation or even a merger of their northern German container terminals. Does it hurt Hapag-Lloyd, as a new co-owner of 30 percent of the Eurogate terminal at JadeWeserPort in Wilhelmshaven, that these negotiations are not progressing?
Habben Jansen: It currently has no impact on our operations and we are not involved in these talks. I have basically said several times that closer cooperation between the northern German terminals would make sense from our point of view. However, HHLA and Eurogate must promote this development.
Dutchman Rolf Habben Jansen (56) has been CEO of Hapag-Lloyd, the world’s fifth largest liner shipping company, since July 2014. The mergers with CSAV from Chile and UASC from the United Arab Emirates have taken place during his term of office to date. Hapag-Lloyd operates 253 of its own and chartered ships with around 14,300 employees worldwide. With 13.9 percent of the shares, the city of Hamburg is the third largest shareholder in Hapag-Lloyd, CSAV and the entrepreneur Klaus-Michael Kühne each hold 30 percent. For 2021, Hamburg received around 860 million euros in dividends from Hapag-Lloyd.