“In Bremen and Bremerhaven we have developed exceptionally well in the last 14 years since restructuring of BLG. In 1998 the company relaunched operations with 3,000 jobs. Today we provide around 16,000 jobs worldwide, including our participations, more than half of them in the federal state of Bremen. We have achieved our goal of developing BLG from a local port operator into an international logistics group and will continue to pursue this path,” said BLG CEO Detthold Aden at the company’s balance sheet press conference in Bremen on April 23.
In the 2012 financial year the BLG LOGISTICS GROUP closed better than expected with earnings before taxes of EUR 49.1 million and achieved a result slightly above that of the previous year. Increases in the Automobile Logistics and Contract Logistics segments exceeded declines in earnings in container business at the EUROGATE joint venture due to pre-operating and startup costs at the container terminals in Wilhelmshaven, Ust-Luga and Tangier.
A total of 6.75 million vehicles were handled, transported and technically processed in the Automobile Logistics segment in 2012. The Contract Logistics segment grew on the basis of its existing business and several new deals. The new segment of Logistics for Offshore Wind Turbines also recorded growing employment. The Automobile Logistics and Container Logistics Divisions maintained their position as market leaders in Europe. In the Contract Logistics segment BLG numbers among the leading German service providers.
Aden: “Through our subsidiaries and shareholdings we have set up an incomparable network with terminals on the sea and inland as well as many other locations for specialized logistics services in Europe, North and South America, Africa and Asia. With 100 locations at the moment we are present in all growth markets around the globe and pursue a long-term growth strategy.”
Sales in the Group rose by 13.5 percent in 2012 to EUR 1.14 billion. Positive quantitative developments, with growing volumes in the Automobile Logistics and Contract Logistics segments, were characteristic of the financial year. In the Container Logistics Division the cargo handling volumes in the terminal network were above the previous year’s level at 13.3 million TEU. The strongest division with EUR 419 million was Automobile Logistics, followed by Contract Logistics with EUR 405 million and Container Logistics with EUR 327 million, corresponding to the 50 percent share in EUROGATE.
In 2012 BLG increased its investments by 89 percent to EUR 125.6 million. The majority applied to the Wilhelmshaven container terminal. As a result of the high investments, the net indebtedness rose by 15.1 percent to EUR 392 million. At the same time the total return on capital dropped from 6.3 to 6.0 percent. The equity of the BLG Group increased by 3.9 percent to EUR 367.1 million in 2012. The return on equity declined by 4.2 percent to 13.6 percent. Because of the decline in earnings in the Container segment the total return on capital dropped slightly to 6.0 percent. As in the previous year, a dividend payout of 40 cents per share of BLG AG will be proposed to Annual Shareholders’ Meeting on May 23.
Automobile Logistics
Through its AUTOMOBILE Division BLG is the market leader in Europe. No competitor has a comparable portfolio for finished vehicle logistics with cargo handling, storage and technical services at seaport and inland terminals and freight forwarding and transport logistics services via road, rail and inland waterway. Altogether, around 6.75 million vehicles were handled, transported and technically processed in 2012. That was 4.7 percent more than in the previous year. The seaport terminals profited from the export success of German carmakers. Bremerhaven attained another record mark with a total of nearly 2.15 million vehicles.
By virtue of new plants of Asian manufacturers in Eastern Europe, imports via Bremerhaven declined, however. Around 75 percent of the cargo handling volume last year was accounted for by exports and only 25 percent by imports. BLG is present in Eastern Europe with terminals and transport services. Among other things, it transports KIA and Hyundai vehicles from the Czech Republic and Slovakia and distributes the cars to the German dealers via the Kelheim automobile terminal. Altogether, 3.82 million vehicles were handled at the seaport and inland automobile terminals in 2012. BLG carried out work on 820,000 vehicles at its technical centers. The company transported 1.44 million units via road, rail and water and 670,000 vehicles via freight forwarding services. At the end of 2012 BLG AutoRail had 1,100 special railway wagons. The targeted figure of 1,300 will be reached by the end of this year. BLG operates seven inland vessels on the Rhine and Danube.
Contract Logistics
Contract Logistics at BLG encompasses car parts logistics, industrial and offshore wind energy logistics as well as retail and seaport logistics. In the car parts logistics sector the company recorded substantial growth in 2012 by winning over BMW as a new client at the Wackersdorf location and through increases at Mercedes in Germany and in the US. In the retail logistics segment the existing customers provided for growth. The volume for client Tchibo at the high-bay warehouse in Bremen will double after BLG takes over handling of online business in the middle of this year. The company is investing over EUR 50 million in expansion of the facility for this purpose. The additional business will involve 200 new jobs. Frankfurt am Main became a new location for our retail logistics at the beginning of this year. BLG performs logistics services for two companies in the clothing industry there.
In the seaport logistics segment in Bremen BLG recorded considerable growth in 2012 through increasing exports of large pipes. In the industrial logistics sector it won over Bosch Thermotechnik as a new client at the Butzbach location. In addition, BLG has been providing logistics services and shipments for the offshore energy industry since February 2012. In 2011 it invested over EUR 20 million in expansion of an offshore terminal in Bremerhaven and construction of an offshore pontoon.
The Contract Logistics segment also encompasses Sustainability and New Technologies. Ecological sustainability was strengthened with a separate staff unit in 2011 so as to pool and expand the existing activities and generate new impetus. Green logistics at BLG protects resources by means of less energy and water consumption and shifting traffic from road to rail and inland waterways. Moreover, BLG focuses on electric mobility and similar measures to reduce CO2 emissions by 20 percent by 2020.
Container
In 2012 a total of 7.9 million TEU were handled at the German terminals. That corresponded roughly to the previous year’s volume. In Bremerhaven cargo handling rose by three percent to 6.1 million TEU. Hamburg, by contrast, suffered a decline of 12 percent to 1.8 million TEU. This is attributable to cooperation between two shipping companies that led to the loss of ship calls in Hamburg. Bremerhaven was additionally developed into a base port for storage and handling of onshore and offshore wind turbines at terminal section CT1. The startup in Wilhelmshaven is sluggish and consequently the planned volumes have not yet been reached. The objective for this year is acquisition of another shipping company for the location. The terminal on the Jade offers optimal nautical conditions and ideal hinterland connections.
Worldwide container traffic is currently going through a slump phase. The euro crisis and lower demand in some parts of the world are the main reasons. Furthermore, container shipping companies have the problem of excessive transport capacity in a market that is not developing as expected at the moment. The increasing number of large container vessels holding 10,000 TEU and more is leading to overcapacity and changes in the structure of scheduled container services. Because of progressive globalization, container traffic will remain a growth market in the long run. The pace of growth has temporarily slowed, however.
The new Board of Management
At the beginning of the year Frank Dreeke became a new member of BLG’s Board of Management. On June 1, 2013 he will succeed Chairman of Board Detthold Aden, who is going into retirement. Dreeke initially gained professional experience in the container sector, among other things as General Manager Central Europe of the Sea-Land shipping company and as Head of the MAERSK LINE in Germany. From 2004 to 2012 he was Managing Partner of the Bremen enterprise EKB Container Logistik. He is extremely familiar with the Bremen economy and the international port and logistics world. Dreek: “Now I also know my way around the BLG world. It was nice to note the feeling everywhere that we work for a great company, we are proud of this company and we want to do our share in moving BLG ahead. There is a kind of BLG spirit that I would like to cultivate.”
How will things at BLG continue when four members of the Board of Management soon step down? Dreeke on this question: “I am taking over a magnificent edifice at BLG that is the European champion in two of its three divisions. If we succeed in preserving the valuable fabric of this structure and even expand it, such as in the Contract Logistics Division, we will have achieved a lot. In this endeavor we will have the active support of the remaining colleagues, Hartmut Mekelburg and Emanuel Schiffer, as well as the new colleagues, Jens Bieniek for Finance, Andreas Wellbrock for the Contract Logistics Division and Michael Blach for the Automobile Logistics Division.”
