Reporting 2020

Economic Value Creation

We prioritize strategic and sustainable growth. This helps us meet the responsibility we have as a major employer at many locations.

As part of the logistics sector, we provide services at the decisive interfaces between producers, retailers, and consumers. This includes production supply, goods distribution as well as traditional freight forwarding business. The demands on logistics are changing at an ever-increasing pace. This development is being driven not only by continuing globalization but also by ever shorter product life cycles, advancing urbanization in many parts of the world and new technologies. Our industry also faces challenges from the unrelenting pressure on margins as well as demographic development and the related shortage of skilled employees. Other factors are the ever-growing importance of e-commerce and high customer demands regarding speed, flexibility, quality of delivery and green credentials. In the current situation, the development of the coronavirus pandemic over the coming months is, of course, also one of the risks that has to be allowed for. Although the impacts have meanwhile been factored in to existing business processes and the economy as a whole has adjusted to the new situation, significant disruptions to the global flow of goods and therefore also to logistics processes may occur again in the future.

Financial management

As part of BLG LOGISTICS’ mission and vision and the sharpening of our strategic guidelines, we designed the management system to be as clear and transparent as possible. Internal reporting and remuneration systems are established for the entire Group stringently according to uniform measurement variables. The key performance indicators are revenue, earnings before taxes (EBT) and the EBT margin derived from both of these.

2020 2019
Revenue EUR million 1,065.2 1,158.6
EBT EUR million -116.1 37.5
EBT margin in % -10.9 3.2

Against the backdrop of the coronavirus crisis, we closed the 2020 financial year with a very substantial loss overall. While the business development at the start of the reporting period was in line with our expectations, the historic ramifications of the pandemic for the world economy, global trade flows and the business of our customers was quickly felt in terms of volumes and results. Due to the idle business of many of our customers in the lockdown months of March to May alone, we incurred a loss in the double-digit millions. This was compounded by measurement adjustments and risk provisioning necessitated by the pandemic. Volumes and earnings picked up again toward the end of the year, so that all in all we came through the crisis better than had been forecast in the spring, despite the negative development. There was sufficient liquidity at all times and the number of employees also remained stable. The increased diversification of our business in recent years and, hand in hand with this, the broader customer base from different industries have given us valuable advantages here.

Group revenue declined year on year by EUR 93.4 million to EUR 1,065.2 million, a decrease of around 8.1 percent. EBT also reduced markedly as a result of the effects of the coronavirus pandemic – by EUR 153.7 million to EUR –116.1 million. Correspondingly, the EBT margin was –10.9 percent, which is significantly below the previous year’s figure of 3.2 percent. The financial management of BLG LOGISTICS is detailed in depth in our Financial Report 2020. Even though 2021 will still be characterized by challenging conditions, uncertainties and probably temporarily fluctuating volumes, we are working intensively to constantly improve our overall financial situation and, despite the crisis, consider ourselves well positioned for the future.

UN goal: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all

Due to the size of our company, we are a significant economic factor at many locations. We are very conscious of the responsibility this entails for secure jobs – among other things through strategies for sustainable growth.

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Value creation calculation

The information about economic value creation and distribution reveals how we generated and used our assets for our stakeholders. Net value creation is used as an indicator of the added value of our business operations for the economy as a whole. This is calculated as the gross operating revenue less expenses, depreciation and amortization (excluding personnel expenses). In the reporting year, it totaled EUR 375.6 million. The largest portion of the value added, at EUR 455.5 million, was used to cover costs for the employees of BLG LOGISTICS. Due to the operating losses, the net value creation was not sufficient to fully cover personnel expenses in the reporting year, resulting in an overall loss for the period. This includes not only wages and salaries, but also other expenses such as statutory social security and pension contributions. Personnel costs increased slightly on the previous year by EUR 3.3 million.

In addition to personnel expenses, the value added generates a return for the capital providers. Of this, an amount of EUR 11.3 million was attributable to distributions and dividends to the main shareholder of BLG LOGISTICS, the Free Hanseatic City of Bremen (municipality). In addition, profit distributions were made to the partners of fully consolidated joint ventures and the shareholders of BLG AG, as well as interest payments for bank loans. The remaining loss was eliminated in the equity of BLG LOGISTICS against retained profits from previous years. Payments to the public purse consisted mainly of taxes and ground rent.

Value creation calculation for BLG LOGISTICS 2020

Financial year 2020 EUR million in %
Revenue 1,065.2
Other income -8.2
Gross operating revenue 1,057.0
Cost of materials 454.9
Depreciation and amortization expense, impairment losses 115.4
Other expenses 111.1
Total advance payments 681.4
Value creation 375.6 100
  Employees 455.5 121
  Public authorities 25.1 7
  Lenders 15.2 4
  Shareholders -120.2 -32

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