ANNUAL
REPORT 2008
THINKING AHEAD – MOVING FORWARD
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Contents Foreword .............................................................................. 04 History ................................................................................... 06 Highlights of the Year .......................................................... 10 People .................................................................................. 12 Facts & Figures ...................................................................... 17 Development of the Company Group ................................. 18 Air Freight and Sea Freight Europe ..................................... 20 Road Transport Europe ........................................................ 22 Asia ........................................................................................ 24 Oceania, Middle East, Africa (OMEA) ................................. 26 Americas ................................................................................ 28 Committed to Sustainability ................................................ 30 Products ................................................................................ 32 Hellmann Locations ............................................................. 34
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Foreword
Jost Hellmann
Klaus Hellmann
Karl Engelhard
Manfred Fischer
Mark Hellmann
Main Board The company’s overall performance in 2008 remained positive despite the global economic slowdown which became especially evident in the 4th quarter of 2008, where freight volumes decreased significantly worldwide. Currency adjusted revenue growth for the year reached 4.6 percent bringing the total annual global revenue to 2.87 billion euros. On a regional level, the Americas division achieved an exceptional growth in revenues of 14.9 percent, making it the top performing region followed by Europe at 6.7 percent* before OMEA (Oceania, Middle East and Africa) and Asia. The top performing industry solutions in terms of revenue growth were: the Automotive division and the Contract Logistics & Consulting sector with 75.7 percent* and 27.7 percent* respectively. While the company’s core products saw its global air freight revenues decreased by 2 percent* as a result of the economic downturn, sea freight revenues actually rose by 5.5 percent* and road transport revenues also increased by an impressive 14.5 percent* in 2008. The market trend shifted towards dispatching a larger quantity of smaller shipments and has resulted in an increased number of consignments, lower tonnage figures and a slight decrease in the total number of sea freight containers transported. Overall, the number of consignments handled by the company increased by 9.6 percent year on year while tonnage decreased by 0.9 percent and the total number of TEUs decreased by 2.8 percent. * Denotes figures after currency adjustment
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History
Hellmann: A History of Innovation and Partnership Throughout its more than 137-year history, Hellmann has distinguished itself with many attributes but only two differing traits; an unwavering focus on customer satisfaction and an eagerness to embrace innovation and change. Since our humble beginnings, our goal has been – and always will be – to grow alongside our customers. 1871
Carl Heinrich Hellmann founds the company as a one-man business delivering goods by a horse-drawn cart.
1925
Hellmann becomes one of the first companies to successfully replace their horse-drawn fleet with coal-powered trucks in Germany.
1935
An innovation in efficient transport management: Hellmann launches a large scale (LTL) consolidated freight terminal with 60 employees.
1968
After more than 20 years of post-war growth and expansion across Europe, the company’s shares are transferred to the fourth generation, Jost and Klaus Hellmann.
1976
Hellmann becomes a founding member of the DPD parcel system service.
1981
Hellmann opens their first Asian office in Hong Kong, followed soon after by offices in the People’s Republic of China, Taiwan, Singapore, South Korea, and more recently Vietnam, Sri Lanka and Japan.
1987
Operations begin in Sydney, Australia, followed one year later by office openings in New Zealand.
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1988
Operations begin in Long Beach, California, and expansion ensues with offices in 18 U.S. cities, 6 Canadian cities, and additional Hellmann offices across Mexico and South America.
1992
The Hellmann partner network expands into Eastern Europe.
1996
Hellmann celebrates 125 years of customer enthusiasm and has developed a global network of 341 offices in 134 countries.
2002
Global gross revenue exceeds 2 billion euros as Hellmann’s services become progressively more industry-specific with products from the Perishable, Automotive, Fashion, High-Tech, Process Management, Contract Logistics & Consulting divisions.
2004
Construction is completed on the new Shanghai air freight warehouse. The company’s operations now include 7 A-Class licenses and 23 offices in the People’s Republic of China.
2006
Hellmann receives the coveted “Award of Excellence” from the Global Institute of Logistics.
2007
Hellmann opens offices in India and Pakistan. In August, the European Logistic Center (ELC) in Munich is put into operation and begins the distribution of spare parts for MAN vehicles. The second ELC based in Paris begins operations in December.
2008
Best Office Award for the new building “Speicher III“ in Osnabrueck awarded by the “Wirtschaftswoche“ (a German business magazine).
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Highlights of the Year 10
Benteler Automotive awards Hellmann with “Supplier of the Year“ Every year suppliers from ten different categories are recognized by Benteler Automotive as the best global suppliers. In the category of logistics, Hellmann received the award for outstanding transatlantic Procurement logistics services including the specific development and implementation of packing solutions for optimal loading and utilization of container space. Hellmann receives quality certificate for being family-oriented In April 2008 Hellmann Worldwide Logistics was awarded the “berufundfamilie” (job and family) certificate after an extensive audit. This certificate is based on an initiative by a Germany charity and has existed since 1998. Since its inception, it has been recognized as a prestigious award for family- and employee-oriented companies. Hellmann wins the German “Best Office Award” On 21 October 2008, as a part of the Orgatec International Fair in Cologne, Hellmann received the “Best Office Award” for its new building – the “Speicher III“ office in Osnabrueck. The award was granted by the Cologne Fair, the German business magazine “Wirtschaftswoche“ as well as scientists from the Institute of Ergonomics at the Darmstadt Technical University. Great CLC success for Hellmann USA On 1 July 2008 Hellmann CLC, Inc. – a division of Hellmann Worldwide Logistics, Inc. – announced the acqusition and partnership with WestPoint Home, Inc. to manage and operate the Distribution Center in Wagram, North Carolina. The
WestPoint Center represents the largest CLC set up for Hellmann in the USA and will be a significant step towards the growth of Hellmann’s CLC product. Environmental Management System ISO 14001 In 2008, Hellmann Worldwide Logistics received ISO 14001 certification in three additional locations; Miami (US), Lichfield (UK) and Hong Kong (CN) all achieved the required standard of environmental sustainability as the global certification program continues. China Trader Award On 18 November 2008 Cathay Pacific Germany awarded the prestigious China Trader Award to German-based companies for extraordinary and continuous engagement in the People’s Republic of China and Hong Kong. Hellmann Worldwide Logistics participated this year for the first time and won the “China Trader Award for Sustainable Business“. To qualify for this award, German companies must have a sustainable and long term relationship with China at the core of their business activities.
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People
People First – the Essence of our Success Our top priority remained attracting, recruiting, developing and retaining people who can live up to the expectations of our customers and the markets in which we conduct business. We continuously look for passionate and innovative people to help us create our future. Hellmann is committed to being a global employer of choice. We are dedicated to providing opportunities for continuous learning to our people. In job-related trainings, employees attend seminars to acquire new skills and increase knowledge, preparing them for new challenges and developing their career at Hellmann. Continuous learning programs include on-thejob training, classroom learning, e-Learning, job rotation, mentoring, and professional development. Put simply, we offer challenging assignments and the opportunity to work with highly committed and talented people around the world. In 2008 our staff grew globally to 8,900 full-time employees.
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Hellmann’s People-First philosophy can be summarized as follows: n We
invest in the development of our people.
n We
cultivate individual talent.
n We
enable knowledge transfer in all areas of our business.
n We encourage teamwork and foster a strong sense of community among our people. n We
offer certified apprenticeships and internships all over the world.
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Number of Employees 2006 2007 2008
2006 2007 2008
2006 2007 2008
2006 2007 2008
2006 2007 2008
Europe 4,577 5,357 5,426
Asia 1,188 1,503 1,565
OMEA 530 579 603
America 990 1,117 1,306
Total 7,285 8,556 8,900
The foundation of our Human Resource initiatives is based on: n Recruiting
the best without compromise.
n Performance n Focused
management through continuous appraisals and feedback.
people development to maintain and improve performance.
n Employee
commitment through recognition, reward and support.
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Facts & Figures
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Development of the Company Group Despite the global economic slowdown, total turnover for the company group rose in 2008 to 2.87 billion Euros. Europe remained the largest producer of revenue with 56.3 percent of total revenues; Asia generated 17.5 percent, the Americas 17.4 percent and OMEA 8.8 percent. In terms of products, road transport reported the highest revenue growth for the year. Sea freight also increased while the air freight division reported a slight reduction in year on year revenues as a result of the global economic 18
%
Percentages Germany/International 2008
42.5
Germany
57.5
International
% 17.4
Percentages of the Regions 2008 Americas
8.8
OMEA
56.3
Europe
17.5
Asia
%
Percentages of the Divisions 2008
28.5
Air Freight
32.8
Sea Freight
22.8
Overland
15.9
Others
downturn specifically in the second half of 2008. The other products, when grouped together, also reported a small decline in total revenues in comparison to 2007. Sea freight remained the largest division with 32.8 percent, air freight’s share declined by a fraction to 28.5 percent and the road transport division increased its share to 22.8 percent. The other divisions account for the remaining 15.9 percent, representing only a slight decrease from the previous year.
Revenue of the Divisions 2008 in million euros 819.6
Air Freight
943.8
Sea Freight
655.6
Overland
455.0
Others
Total Revenue in billion euros 2006
2,65
2007
2,82
2008
2,87
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Air Freight and Sea Freight Europe With nearly 23 percent of the total turnover worldwide, the European air and sea freight group represented the largest component of global revenues. The company’s own air freight and sea freight entities now include 12 European countries with the acquisition of the Czech Republic, Turkey and Denmark in 2008.
total annual revenues. As a direct result of increased business development and acquisitions, the European sea freight turnover sector reported an increase in revenues and a 6 percent growth in the number of TEUs transported despite the worsening market situation.
Due to a significant reduction in 4th quarter trade, the air freight sector suffered a 4 percent decline in consignments, a 13 percent reduction in tonnage and a decrease of 4 percent* in 20
* Denotes figures after currency adjustment
Air Freight Consignments 2006
206,283
2007
204,144
2008
196,880
Air Freight Tonnage 2006
118,324
2007
117,010
2008
101,291
Sea Freight TEUs 2006
120,382
2007
139,489
2008
147,827
Air Freight Turnover in million euros 2006
259.1
2007
276.8
2008
260.2
Sea Freight Turnover in million euros 2006
292.5
2007
357.0
2008
388.3
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Road Transport Europe After a very successful first half of 2008, volumes in all European road transport segments were adversely affected in the 4th quarter as a result of a declining economy. Despite the global economic setback, the number of consignments, the total weight transported and the annual turnover in the European road transport division still increased year on year. The European Trucking network was entirely reorganized in 2008 and the reduction in the number of partners from 25 to 10 resulted in a harmonization of systems and processes. The continued 22
Overland Consignments 2006
9,281,347
2007
10,678,934
2008
11,881,207
Overland Tonnage 2006
3,141,504
2007
3,876,683
2008
3,982,899
expansion of the gateway concept also allowed for increased optimization of delivery times across Europe. In 2008, Hellmann Spain joined the European road transport network, a new trucking branch opened in Ruesselsheim near Frankfurt and 12 new branches opened in Russia, Belarus, Ukraine, Latvia, Lithuania and Estonia. In Turkey, the joint venture was dissolved and the country now operates under the Hellmann Worldwide Logistics banner.
Overland Turnover in million euros 2006
485.4
2007
575.7
2008
650.7
2006
336.6
2007
374.3
2008
319.7
Others Turnover in million euros
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Asia Asia as a region experienced very positive growth in the first half of 2008 with nearly all countries performing well. However, the effects of the global economic downturn on Asian trade became evident in the fourth quarter of the year resulting in a revenue reduction of 6.8 percent*. Despite the negative economic influences, over- all tonnage increased by an exceptional 11.7 percent, while the number of consignments remained flat and the total number of TEUs dropped only slightly by 2.6 percent.
The air freight charter program was well maintained and China continued to grow with the exception of Southern China particularly in the 4th quarter. Geographic markets showing the most growth were Northern China, Vietnam, Indonesia and Bangladesh. The Contract Logistics & Consulting product has shown continued strong demand with many new entrants in the Asian marketplace. The company has invested extensively in South Asian markets such as India, Sri Lanka, Bangladesh and Pakistan.
* Denotes figures after currency adjustment
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Air Freight Consignments 2006
185,433
2007
190,145
2008
188,003
Air Freight Tonnage 2006
134,887
2007
134,202
2008
125,223
Sea Freight TEUs 2006
135,070
2007
162,493
2008
161,303
Air Freight Turnover in million euros 2006
372.1
2007
323.8
2008
324.8
2006
153.5
2007
180.4
2008
168.2
2006
0.350
2007
5.993
2008
9.799
Sea Freight Turnover in million euros
Others Turnover in million euros
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Oceania, Middle East, Africa (OMEA) In 2008, the OMEA region was also affected by the global downturn and experienced a downward trend in consignments, tonnages and TEU numbers during the final quarter of the year. Overall the region reported a reduction in tonnage of 4.9 percent, a reduction in consignments of 1.7 percent and the number of TEUs transported decreased by 26.7 percent. In the product divisions, the Automotive division continued to grow with a 9.2 percent* revenue increase mainly as a result of business growth in the Middle East distribution hub in Dubai and a strong demand for
specialized automotive services in South Africa. The Contract Logistics & Consulting sector grew by 15.8 percent* as a result of the product being well received in Australia, New Zealand and the UAE. Despite the reduction in tonnage, the sea freight division reported revenue growth of 3.6 percent* while airfreight revenues dropped by 1.3 percent*. The region overall reported a total annual turnover increase of just under one percent* year on year.
* Denotes figures after currency adjustment
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Air Freight Consignments 2006
48,673
2007
45,485
2008
42,516
Air Freight Tonnage 2006
21,601
2007
24,113
2008
18,024
Sea Freight TEUs 2006
43,050
2007
49,198
2008
36,140
Air Freight Turnover in million euros 2006
82.8
2007
86.4
2008
70.3
Sea Freight Turnover in million euros 2006
167.8
2007
168.5
2008
139.8
Others Turnover in million euros 2006
37.3
2007
38.6
2008
43.4
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Americas Total revenue for the region in 2008 was 498.7 million Euros compared with 432.2 million Euros for the same period in 2007, an increase of 15.4 percent*. Both tonnage and consignments increased by 3.4 percent and 3 percent respectively. The total number of TEUs transported fell slightly by 0.7 percent.
in the region through an aggressive focus on new products such as Contract Logistics & Consulting as well as Project business.
This growth was consistent within the three sub-regions of USA, Canada and Latin America and was impressively maintained despite the economic downturn throughout the second half of 2008. Market share was expanded * Denotes figures after currency adjustment
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Air Freight Consignments 2006
149,315
2007
166,577
2008
179,708
Air Freight Tonnage 2006
142,102
2007
175,634
2008
163,127
Sea Freight TEUs 2006
150,634
2007
172,470
2008
168,108
Air Freight Turnover in million euros 2006
181.4
2007
150.2
2008
164.3
Sea Freight Turnover in million euros 2006
219.6
2007
223.3
2008
247.5
Others Turnover in million euros 2006
58.3
2007
59.1
2008
86.9
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Committed to Sustainability For a globally active company such as Hellmann Worldwide Logistics, the development of economic interests is inherently connected to our responsibility to the environment and the idea of sustainable development has long been our focus. At Hellmann we are committed to working within a structured system of environmental management using task-oriented methods, continuous self-monitoring and regular external auditing.
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For all of our activities we have goals in place to achieve sustainable development. Some of our tasks include: waste reduction and recycling, reduction of greenhouse gas emissions in all vehicles, energy saving and electricity reduction in the workplace, elimination of environmentally harmful chemicals and cleaning agents from the workplace, green space maximization for exterior areas, elimination of salt usage for winter walkway and parking maintenance; sponsorship of ecological and environmentally friendly programs and ISO 14001 certification. We recognize that there is still much to be done and we are committed to ensuring that all our business activities and services continue to be economically, socially and environmentally responsible.
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Products
Portfolio 33
National and Continental Road freight
CourierExpress, Parcel Services
Contract Logistics & Consulting
Airfreight, Seafreight, Sea-Air, Customs Brokerage
Direct Load, Rail Solutions
Industry Solutions: Automotive, Electronics, Fashion, Healthcare, Perishables, Public Private Partnership
ITSolutions
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Hellmann Locations
www.hellmann.net
Hellmann Headquarters Osnabrueck Hellmann Worldwide Logistics GmbH & Co. KG Elbestrasse 1 49090 Osnabrueck Germany Phone +49 541 605-0 Fax +49 541 605-1211
Hamburg Hellmann Worldwide Logistics GmbH & Co. KG Industriestrasse 100 21107 Hamburg Germany Phone +49 40 7537-00 Fax +49 40 7526208
Sydney Hellmann Worldwide Logistics Pty Ltd. Airgate Business Park 289 Coward Street 2020 Mascot NSW Australia Phone +61 2 9667-7555 Fax +61 2 9667-7666
Hong Kong Hellmann Worldwide Logistics Ltd. Unit 2, G/F, Block A Tonic Industrial Center 26 Kai Cheung Road Kowloon Bay, Kowloon Hong Kong Phone +852 3626-8000 Fax +852 2796-7303
Miami Hellmann Worldwide Logistics, Inc. 10450 Doral Boulevard Doral, Florida 33178 United States of America Phone +1 305 406-4500 Fax +1 305 406-4519
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Certified paper from sustainable forestry