Angela Titzrath, Chairwoman of HHLA’s Executive Board,clarifies: “The temporary closure of the terminal in the Port of Odessa has not impaired HHLA’s successful business activities significantly. According to current estimates, the sanctions imposed by the EU will also also have only a minor impact on the company’s economic development. HHLA is on a solid financial basis. Even under the challenging conditions of the Corona pandemic, HHLA achieved positive business results. We are also operationally stable enough to meet our customers’ requirements both at our terminals in Hamburg, Tallinn and Trieste and by rail. Logistics always means managing volatility. We rise to this challenge. This is because we are aware of our responsibility as a service provider for the industrial nation of Germany. Companies and consumers can rely on us to continue to supply them reliably with goods and commodities.”
HHLA has been active Ukraine since 2001. In the port city of Odessa, it operates the largest container terminal, which is of central importance for supplying Ukraine.
On the instructions of the Ukrainian authorities, the terminal was closed with the start of the Russian invasion of Ukraine on 24 February 2022. The approx. 480 employees on site were sent home. Their safety is HHLA’s top priority. Whether and when Container Terminal Odessa (CTO) will be able to resume operations cannot be predicted at present due to the ongoing hostilities.
The CTO share of container throughput, revenue and earnings of the Port Logistics subgroup was in the low to mid single-digit percentage range in the 2020 financial year. A significant part of the investments made to date, amounting to € 170 million, had already been amortised by the end of the 2020 financial year.
HHLA has also secured the CTO against political risks by taking out federal guarantees for direct investments abroad. These cover a significant portion of the CTO’s current assets in the event of war or expropriation and in the event of a breach of legally binding commitments by government or government-controlled entities.
In the 2020 financial year, the CTO's balance sheet equity amounted to € 44 million. A significant portion of this would be covered in the event of a possible call on the federal guarantees. According to the current risk assessment, HHLA assumes that no significant financial burdens will arise for the company.
In addition, measures to implement the sanctions imposed by the European Union (EU) against Russia also took effect at HHLA's container terminals in Hamburg on 1 March 2022. Since 1 March 2022, no containers coming from or destined for Russia will be handled here. This also applies to cargo transported by rail, barge or truck. HHLA is thus following the example of terminal operators in other European ports and responding to the consequences of implementing the sanctions decided at European level in global supply chains. The situation remains dynamic and will be adjusted accordingly as the market situation changes.
In 2020, HHLA handled a total of 229 thousand TEU of containers at the Hamburg container terminals (approx. 3 percent of HHLA’s total container throughput) with Russia as shipping region. A significant decline already occurred in 2014 as a result of the sanctions imposed on Russia in response to the annexation of Crimea.
Further information on the situation and possible financial impact on HHLA will be provided with the publication of the Consolidated Financial Statements on 24 March 2022.