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Robert.Jervis_43227 Mar 10

Hapag-Lloyd to acquire container liner business of DAL

Also reported a net profit of $10.75bn and exec contract extensions
Hapag-Lloyd and German carrier Deutsche Afrika-Linien (DAL) have signed a framework agreement under which Hapag-Lloyd will acquire the container liner business of DAL.

With a history dating back to the year 1890, DAL is an established liner shipping company for the transportation of containerised cargo and operates with four liner services between Europe, South Africa and the Indian Ocean.

Headquartered in Hamburg, the Africa expert is represented with own offices in Germany and South Africa as well as through third-party agents in 47 countries worldwide. Their liner business (including agencies) employs more than 150 people. DAL owns a 6,589 TEU container ship and operates a container fleet of around 17,800 boxes (owned and leased), which will be taken over as part of the acquisition.
"Africa remains an important strategic growth market. Particularly for our service offering from and to South Africa, DAL is a valuable addition allowing us to offer our customers a better network and additional port coverage in this region. We are very much looking forward to welcoming the DAL colleagues. With their broad experience and market knowledge, they will significantly support us to further grow in Africa," says Rolf Habben Jansen, CEO of Hapag-Lloyd.
Only last year, Hapag-Lloyd had acquired Africa-specialised carrier NileDutch, which significantly strengthened the carrier's presence and service offering to and from West Africa. This growth-oriented strategy was also underlined by new office openings in Kenya, Morocco and Senegal in 2021 and the establishment of a Quality Service Center (QSC) in Mauritius in 2020.
The completion of the transaction is subject to the approval of the responsible antitrust authorities.

Separately, Hapag-Lloyd has published its audited annual report for the 2021 financial year today. In the reporting year, Hapag-Lloyd's EBITDA increased to slightly more than USD 12.8 billion (approximately EUR 10.9 billion). The EBIT rose to USD 11.1 billion (approximately EUR 9.4 billion), and the Group net result improved to around USD 10.8 billion (EUR 9.1 billion). The main drivers of these positive business developments have been significantly improved freight rates resulting from very strong demand for goods exported from Asia.
"We look back on an exceptionally successful year in which we invested massively in modern vessels and new containers. In addition, we have significantly strengthened our financial and asset position. However, transport expenses have unfortunately also risen significantly, mainly due to the bottlenecks in the global supply chains," said Rolf Habben Jansen, CEO of Hapag-Lloyd AG.
Revenues increased to roughly USD 26.4 billion (approximately EUR 22.3 billion). This can mainly be attributed to a higher average freight rate of 2,003 USD/TEU (2020: 1,115 USD/TEU). Transport volumes were roughly on a par with the prior-year level, at 11.9 million TEU (2020: 11.8 million TEU) due to the strained supply chains. At the same time, transport expenses rose very significantly, by 17.1 percent, to USD 12.2 billion (EUR 10.3 billion). This was particularly due to higher bunker prices and charter rates as well as increased demurrage and storage fees.
In 2021, the net debt was completely paid off. At the end of the year, the liquidity stood at roughly USD 8.7 billion (approximately EUR 7.7 billion). It thereby significantly exceeded financial debt, with the result that Hapag-Lloyd had net liquidity of around USD 2.5 billion (EUR 2.2 billion) as of 31 December 2021.
In light of this very successful financial year, the Executive Board and Supervisory Board of Hapag-Lloyd AG have decided to propose to the Annual General Meeting that a dividend of EUR 35 per share be paid out for the 2021 financial year.

Lastly, The Supervisory Board of Hapag-Lloyd AG has agreed to an early extension of the contract of Rolf Habben Jansen, it's Chief Executive Officer, until 31 March 2027. The contract of Mark Frese, Chief Financial Officer, was extended by five years, until 30 November 2027.
Rolf Habben Jansen is a member of the Executive Board of Hapag-Lloyd since 1 April 2014. He is Chief Executive Officer (CEO) since 1 July 2014.
"Rolf Habben Jansen has led Hapag-Lloyd successfully through challenging times. Today Hapag-Lloyd is one of the most profitable companies in the industry. The supervisory board is convinced that the company will continue its profitable growth under the successful leadership of Rolf Habben Jansen", says Michael Behrendt, Chairman of the Supervisory Board of Hapag-Lloyd AG.
Mark Frese was appointed to the Executive Board of Hapag-Lloyd AG effective 25 November 2019. Since 1 March 2020, he has been Chief Financial Officer (CFO) of the company.
"Mark Frese has done an excellent job over the past three years. During his tenure, Hapag-Lloyd has further improved its profitability and optimised its balance sheet structure. It is also due to him that Hapag-Lloyd has a very healthy financial and asset base. This is an important prerequisite for the implementation of the strategic goals", adds Michael Behrendt