Global Transportation posting further gains
- Operating profit after risk provisioning substantially up
- ROE rises to 22.6 percent
Hamburg/Kiel, November 7, 2007 - HSH Nordbank significantly increased operating profit after risk provisioning in its core Shipping and Transportation segments after the first nine months of 2007. Totaling EUR 362 million, earnings were up more than 43 percent on last year’s figure of EUR 254 million. The entire segment under the Global Transportation Markets umbrella benefited from the sustained upward momentum in the international shipping and transportation business. The segment’s ROE rose to 22.3 percent, equivalent to a year-on-year increase of 3.3 percentage points.
New business continued to show a dynamic trend in the third quarter. In the first nine months of 2007 HSH Nordbank financed ships with a volume of some EUR 10.2 billion (prev. year EUR 7 billion). More than half of this volume was signed with international clients. The Company once again successfully broadened its income basis. This broadening is also reflected in a significant increase in net commission income of almost 50 percent. In particular, higher sales of capital-market products, especially in Germany and North America, exerted a positive impact. Furthermore, the sale of an equity holding was a contributing factor in the nearly 39 percent increase in operating earnings after risks to EUR 284 million (prev. year EUR 204 million).
The main signings in the Shipping segment in the third quarter include the financing of three 13,100 TEU container ships of the super-post-Panamax class in collaboration with DnB NOR Bank ASA. This order has a volume of approx. EUR 367 million. “Following the strong growth in the first nine months, we will expand our business in the course of the year on a selective basis. In the process, we will increasingly focus on offering our clients services and capital-market instruments, in order to increase the share of our earnings that do not tie up capital,” commented Peter Rieck, Deputy Chairman of HSH Nordbank.
Transportation (aviation, railroad, logistics/infrastructure):
The Transportation segment continued its positive performance in the third quarter. New business volume came to EUR 3.3 billion and thus reached last year’s high level, despite the persistently high competitive pressure. Like the Shipping segment, the Transportation segment increased its net commission income sharply by approx. 45 percent.
A short excerpt of the transactions completed in the third quarter of 2007 is set out below:
In the Aviation unit, HSH Nordbank acted as arranger, underwriter and agent in the advance payment finance of twelve A330-200 aircraft for Spanish travel group Marsans Group. In New York, the Bank financed six A319-100 and four A320-200, which Airbus will deliver to the new U.S. low-cost carrier Virgin America by the end of 2008. HSH Nordbank moreover assumed responsibility for financing two B777-200ER for Thai Airways.
In the Railroad unit we arranged, among other things, the financing for a railway-vehicle leasing company in Russia. This start-up is a joint venture between a leading Western European cargo-truck rental company and a local partner who is linked into the Russian railroad industry as producer of tank wagons and standard freight wagons. The loan for new and second-hand cargo wagons was supplemented with complex interest-rate hedging.
The Logistics/Infrastructure unit also did well, assisting in a large number of attractive transactions. For instance, HSH Nordbank is financing the link from Brussels airport to the Belgian long-haul rail network. The project, known under the name of “Diabolo”, is the first Belgian infrastructure project of its kind, which will be financed as part of a private-public partnership (PPP). With this project HSH Nordbank, acting as a minority investor and sole arranger of the debt financing, adds to its long-standing experience in the planning and financing of major construction projects.
Further information as well as photographs of the members of the Management Board are available at www.hsh-nordbank.de
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