BLG Logistics reports financial results for 2020, with revenues declining by 8.1% to under €1.1bn, compared to €1.2bn in 2019.
“The coronavirus crisis impacted on our business to an unprecedented extent. Despite the clear loss, the BLG Group came through the crisis better than projected a year ago. One reason for this is that we have increasingly diversified our portfolio in recent years,” explained BLG LOGISTICS CEO Frank Dreeke.
Due to the global pandemic restrictions during March to May, sales revenue in all divisions collapsed, leading to an operating loss of €25m. As the economy started to bounce back from the summer onward, especially in Asia, handling volumes and results steadily improved. However, this did not make up for the operating losses. Earnings were negatively affected, partly due to the pandemic. In the CONTAINER Division, these factors amounted to €60.2m, while the cumulative figure for the other two divisions, AUTOMOBILE and CONTRACT, was €30.7m. The EBT margin dropped by 10.9%, compared to EBT in 2019 of €37.5m, and an EBT margin of 3.2%.
Sales in the automotive industry in 2020 were around a quarter below the expected level, with direct effect on the volumes of all business areas in the AUTOMOBILE Division. At BLG AutoTerminal Bremerhaven, some 20% fewer vehicles (1.7m) were handled y-o-y, transported or technically processed. Across the total AUTOMOBILE network, BLG moved 4.8m vehicles (2019: 6.3m vehicles). Sales revenue generated by the AUTOMOBILE Division decreased by 13.6% to €521.3m, down from €603.7m in 2019. The division was able to attract new customers, e.g. AIWAYS, a Chinese manufacturer of electric SUVs. The Division also gained new cross-border transport business within Europe. The rail business area achieved a positive result despite the challenging pandemic year.
The CONTRACT Division, plant closures and significantly reduced volumes in the automotive industry had palpable effects on the industrial logistics and car parts logistics business areas. Revenue was down by 2% to €552.6m. However, at the Bremen location, business with a major automotive customer was secured on a long-term basis. From 2022, important activities will be pooled in the new, sustainable 80,000 sq m logistics centre “C3 Bremen”. Business was better in many areas of retail logistics. While closures of brick-and-mortar stores caused declines in textiles and furniture, locations with e-commerce services and also returns logistics fared very well. Overall, retail logistics closed the year positively and better than projected. BLG launched new business activities, e.g. in Schlüchtern (CI factory of Engelbert Strauss), Ludwigsfelde (gas turbine logistics for Siemens Energy) and Meerane (cable harness logistics for electric vehicles).
CONTAINER Division is represented by half of the shares in EUROGATE. At €263.5m, sales revenue dropped by 6.7% y-o-y, due to declining average selling prices as a result of competition and effects of the pandemic on freight handling. Considerable one-time expenses due to recognition of impairment losses on non-current financial assets as well as exceptional provisions for the company’s restructuring program depressed earnings by €60.2m. The goal of the transformation process at EUROGATE is to reduce the total annual costs of the Group in Germany by €84m p.a. overall as quickly as possible, but no later than 2024. The EBT (50%) for the CONTAINER Division was €-67.2m, compared to €23.7m in 2019 and the EBT margin was -25.5%, compared to 8.4% in 2019.
BLG CEO Frank Dreeke said, “BLG LOGISTICS systematically continued on its journey toward becoming climate-neutral by 2030. In fact, we are the first German logistics service provider with a scientifically recognised climate protection goal.” In fall 2020, the internationally renowned Science Based Targets initiative (SBTi) recognized the company’s goal targeting an absolute reduction of greenhouse gas emissions.
In 2020, BLG LOGISTICS was a partner in three new research projects examining how artificial intelligence can be used in logistics. The total project volume is €5.8m. Further digitalisation projects include sensor-based tracking of containers for efficient customs processing, chatbots for personnel recruitment and optical parts recognition.
Frank Dreeke added, “There is still major uncertainty about the further impacts of the coronavirus pandemic – both on the global economy and on our customers. 2021 will not be an easy year, but we expect a significant recovery. The results from the first months of 2021 give us reason to be cautiously optimistic. BLG LOGISTICS was able to close the first quarter with a positive result.”
Source: BLG Logistics
