Hapag-Lloyd AG

Earnings Release • Mar 28, 2018

Investor Presentation

Full Year 2017 Results

Hamburg, 28 March 2018

Disclaimer

Forward-looking statements

This presentation contains forward-looking statements that involve a number of risks and uncertainties. Such statements are based on a number of assumptions, estimates, projections or plans that are inherently subject to significant risks, as well as uncertainties and contingencies that are subject to change. Actual results can differ materially from those anticipated in the Company's forward-looking statements as a result of a variety of factors, many of which are beyond the control of the Company, including those set forth from time to time in the Company's press releases and reports and those set forth from time to time in the Company's analyst calls and discussions. We do not assume any obligation to update the forward-looking statements contained in this presentation.

This presentation does not constitute an offer to sell or a solicitation or offer to buy any securities of the Company, and no part of this presentation shall form the basis of or may be relied upon in connection with any offer or commitment whatsoever. This presentation is being presented solely for your information and is subject to change without notice.

UASC's Ltd. and its subsidiaries have been included in the figures from the date control was transferred on 24 May 2017.The key figures used are therefore only comparable with the previous year to a limited extent.

Opening Remarks

01 Deliverables	 We continued to deliver on our initiatives (UASC integration, cash capital increase & continuous cost control)  Clearly increased operating result (EBIT) of USD 466 m in FY 2017 (+234% YoY)
02 Sector Update	 Sector fundamentals remain favourable  Orderbook remains at low level despite recent new orders
03 Financials	 Significantly improved EBITDA of USD 1,198 m in FY 2017 (USD 390 m in Q4 2017)  Further reduction of unit cost despite higher bunker prices  Proposal of first time dividend payment since IPO of EUR 57ct
04 Way Forward	 Clear target to improve profitability going forward and to deleverage the company over time  In the midterm, no needs for major investments – Maximize free cash flow  Access synergies from the merger with UASC – USD 435 m p.a. from 2019 onwards

Strategic Highlights: Hapag-Lloyd looks back on a challenging but successful year 2017…

Financial Highlights: …with a substantially improved operating result

Transport volume	Freight rate	Transport expenses per TEU
+29%	+1%	-0.2%
FY 2017: 9.8	FY	FY
TEU m	2017: 1,051 USD/TEU	2017: 939 USD/TEU
EBIT	EBITDA	Group profit
USD 466 m	USD 1,198 m	USD 35 m
4.1% EBIT margin	10.6% EBITDA margin	3.1% ROIC
Equity	Liquidity reserve	Net debt
USD 7.3 bn	USD 1.3 bn	USD 6.8 bn
Increased equity	Solid liquidity reserve	Consolidated financial position

1 Deliverables

Hapag-Lloyd has improved a lot – Today we are bigger, stronger and more efficient

At a glance

Successful operational integration only six months after closing!

1 Deliverables

Total synergies of USD 435 m p.a. from 2019 onwards confirmed – Significant synergy ramp-up in 2018 expected

Synergy potential

• Optimized new vessel deployment/network
• Slot cost advantages

• Efficient use of new fleet

• Consolidation of Corp. and Regional HQs

• Consolidation of country organizations
• Other overhead reductions (e.g. marketing, consultancy, audit)

Network Overhead Other (terminals, equipment and intermodal)

• Lower container handling rates per vendor/location
• Imbalance reduction and leasing costs optimization
• Optimization of inland haulage network
• Best practice sharing

Synergies

1 Deliverables

8

As result of the capital increase, we have strengthened our equity – while at the same time reducing financing costs

Capital Market Projects

Capital Increase Bond Issuances

• Listing of former UASC shares through a contribution in kind
• Cash Capital Increase successfully completed in October 2017

• Issuance of 11,717,353 new shares, resulting in USD 413 m of gross proceeds used to repay existing indebtness and for general corporate purposes

• Issuance of two new bonds with a total value of EUR 900 m

• The proceeds were used to proactively refinance outstanding bonds due 2017, 2018 & 2019
• Through the issuances we have reduced our finance costs and have improved the maturity structure of our financial liabilities

Demand: Container shipping growth remains on a healthy and constant level driven by a solid global economic growth

Global Container Trade & Global GDP Growth [%]

10

Supply: Orderbook remains at a historically low level, while almost no idle capacity is available

Orderbook-to-fleet Orders placed

Even though, short term supply pressure will most likely persists, mid-term supply/demand gap is closing further

Net Capacity Growth

[in % of worldfleet]

Vessel deliveries

Supply / Demand Balance

Consolidation is still ongoing – Full effects of the higher concentration not fully visible yet

Industry consolidation

Operational margins of container lines have improved in 2017 – Hapag-Lloyd is one of the most profitable carriers

Note: For selected peers including terminals and other business if no liner figure available.

13 Source: Company information (19 March 2018) 1) Based on HL & UASC pro-forma financial information included in the prospectus dated 28 September 2017

We have achieved a significantly improved EBIT of USD 466 m while EBITDA almost doubled to USD 1,198 m in 2017

Operational KPIs

	Q4 2017	Q4 2016	∆%	FY 2017	FY 2016	∆%
Transport volume [TTEU]	2,774	1,949	+42%	9,803	7,599	+29%
Freight rate [USD/TEU]	1,030	1,033	0%	1,051	1,036	+1%
Bunker [USD/mt]	338	269	+26%	318	226	+41%
Revenue [USD m]	3,119	2,182	+43%	11,286	8,546	+32%
EBITDA [USD m]	390	246	+59%	1,198	671	+79%
EBITDA margin	12.5%	11.3%	+1.2ppt	10.6%	7.9%	+2.8ppt
EBIT [USD m]	167	111	+51%	466	140	+234%
EBIT margin	5.4%	5.1%	+0.3ppt	4.1%	1.6%	+2.5ppt
Group profit [USD m]	28	46	-39%	35	-103	n.m.
ROIC [%]	n/a	n/a	n/a	3.1%	1.3%	+1.8ppt

Note: UASC's Ltd. and its subsidiaries have been included in the figures from the date control was transferred on 24 May 2017.

The key figures used are therefore only comparable with the previous year to a limited extent. All information on FY 2017 financials is preliminary and unaudited.

One-offs are mainly related to the first time consolidation and integration of UASC – Total one-off costs estimated at USD 115 m

Transaction & integration related one-off costs [USD m]

Comments

3 Financials

• In 2017, first time consolidation of UASC generated one-off income of around USD 32 m, this includes adjustments to the provisional PPA of USD ~21 m in Q4 2017
• Profit from the remeasurement (USD ~20m) of a joint venture previously recognized as an equity-accounted share almost offset the PPA adjustment in Q4 2017
• Net one-off effect on FY 2017 EBIT of USD ~34 m and USD ~5 m in Q4 2017 respectively
• Further one-off costs of USD ~10 m expected for H1 2018

Interest result mainly affected by extraordinary cost as a result of the early redemption of bonds

Comments

• One-off cost in financial result related mainly to the early redemption of US-dollar and Euro bonds
• Result includes redemption charges, the disposal of associated embedded derivatives as well as other associated transaction cost

17

Transport volume was up by 29% YoY, on a pro-forma basis transport volume with a healthy growth of 4.8% YoY in line with market growth

Transport volume [TEU m]

18

On a pro-forma basis, freight rates have increased by 9.4% YoY

Hapag-Lloyd benefits from optimized bunker consumption, but substantial increase in bunker price harms P&L

Bunker consumption price [USD/mt] Bunker consumption & expenses

20

Despite higher bunker prices, transport expenses per TEU are flat YoY due to continuous cost management – excl. bunker -5.0% YoY

Transport expenses per TEU [USD/TEU]

Substantial free cash flow of USD 1,048 m in FY 2017 – Increased EBITDA and low CAPEX as major driver for CF generation

Cash flow FY 2017 [USD m]

22

Solid equity at USD 7.3 bn and strong liquidity reserve at USD 1.3 bn but also higher net debt as a result of the merger with UASC

Enhanced equity base [USDm] Net debt [USDm]

Improved liquidity reserve [USDm] Successful financial measures

3

• Bond refinancing by issuing two new bonds with a total value of EUR 900 m and proactively repaying outstanding bonds
• Cash Capital Increase with gross proceeds of USD 413 m used to repay existing indebtness 2

Note: UASC's Ltd. and its subsidiaries have been included in the figures from the date control was transferred on 24 May 2017.

The key figures used are therefore only comparable with the previous year to a limited extent. All information on FY 2017 financials is preliminary and unaudited.

Outlook for 2018

	FY 2017	Outlook for 2018	Sensitivities for 2018
Transport volume	9,803 TTEU	Increasing clearly	+/- 100 TTEU	+/- USD <0.1 bn
Average freight rate	1,051 USD/TEU	On previous year's level	+/- 40 USD/TEU	+/- USD ~0.5 bn
Average bunker price	318 USD/mt	Increasing clearly	+/- 50 USD/mt	+/- USD ~0.2 bn
EBITDA	USD 1,198 m	Increasing clearly
EBIT	USD 466 m	Increasing clearly

4 Way Forward

Hapag-Lloyd with clearly defined financial policy

Profitability	Profitability going forward supported by improved fleet ownership structure and synergy realization
Investments	No planned new vessel investments in next years – Maximize free cash flow
Deleveraging	Clear target to significantly deleverage over time
Liquidity	Maintain an adequate liquidity reserve for the Company

4 Way Forward

Executive Board – Changes in organisational structure

Organisational changes

• CEO, Rolf Habben Jansen, is taking over responsibility for sales activities & digitalization
• Joachim Schlotfeldt becomes new Executive Board member with focus on HR and worldwide procurement

• CCO, Torsten Haeser, is leaving as of 31 March 2018

• Focus on product and service quality on CEO level

• Special attention to procurement

Rational behind the changes

Convincing equity story resulted in higher share price…

Share trading

Stock Exchange	Frankfurt Stock Exchange / Hamburg Stock Exchange
Market segment / Index	Regulated market (Prime Standard) / SDAX
ISIN / WKN	DE000HLAG475 / HLAG47
Ticker Symbol	HLAG
Primary listing	6 November 2015
Number of shares	175,760,293

…and bonds continue to trade above par

Commercial integration of UASC completed only five months after closing

Timeline of UASC merger and integration

Fleet optimization ongoing – Efficient and young fleet with a low level of investment needed

Young and fuel-efficient fleet

30

Hapag-Lloyd	68%	32%
COSCO	62%	38%
Maersk	54%	46%
Top 10	50%	50%
CMA CGM	44%	56%
MSC	35%	65%
	current owned fleet	current chartered fleet

Vessel fleet (31 December 2017)

Vessel	Owned3)	Chartered	Current fleet
>14,000 TEU
TEU	284,143	-	284,143
Vessels	17	-	17
10,000 – 14,000 TEU2)
TEU	305,876	71,201	377,077
Vessels	24	7	31
8,000 – 10,000 TEU
TEU	243,614	134,919	378,533
Vessels	28	15	43
6,000 – 8,000 TEU
TEU	108,327	64,789	173,116
Vessels	15	10	25
4,000 – 6,000 TEU
TEU	84,558	120,341	204,899
Vessels	19	23	42
2,300 – 4,000 TEU
TEU	33,800	94,841	128,641
Vessels	11	32	43
<2,300 TEU
TEU	3,918	23,050	26,968
Vessels	2	16	18
Capacity [TEU]	1,064,236	509,141	1,573,377
Vessels	1164)	103	2194)

1) Diagram assuming that currently announced mergers (COSCO & OOCL) will receive regulatory approvals and are executed as announced. Simple sum of stand-alone operating capacity 2) Weighted by carrier capacities 3) Includes finance leased vessels 4) Thereof 4 vessels chartered out

Network optimization ongoing – Fleet and Network optimization as key contributor to synergies

Network optimization in 2017

Trade portfolio optimization – Enhanced market presence in attractive Middle East trade and solid position in all other trades

Transport volume by trade

Hapag-Lloyd FY 2016

[in TTEU]

32

1.020

Far East

403

Transpacific

96 122

LatAm

Atlantic

78

EMAO

929

Middle East

452

Intra Asia

UASC FY 20161) Combined Entity Pro-forma FY 2017

1) UASC historic data allocated according to HL trade definition Note: Rounding differences may occur.

As of 1 April, Alliances have been reshuffled

Atlantic Transpacific Far East 2 2M 41% Ocean 16% Others 9% THE Alliance 34% 2 2M 21% Ocean 40% Others 12% THE Alliance 27% 3 2M 41% Ocean 35% Others 0% THE Alliance 25%

THE Alliance competitive on all trades

Alliance members

34

On important trades TOP 5 players now make up more than 64% capacity share

TOP 5 concentration on individual trades (2013 versus 2018)

Global capacity share [%]

Note: Diagram assuming that all currently announced mergers (COSCO & OOCL; NYK & MOL & K-Line) will receive regulatory approvals and are executed as announced. Simple sum of stand-alone operating capacity as of February 2018.

Contracted freight rates have shown continuous recovery and slightly less volatility

Comprehensive Index (CCFI)

Shanghai – USA (CCFI)

Shanghai – Europe (CCFI)

Shanghai – Latin America (CCFI)

Capital increase successfully completed – Key terms of the rights issue

Offer size	 11,717,353 new shares (c. 7.1 % of current share capital), resulting in EUR 351.5 m of gross proceeds
Subscription price	 EUR 30 per share (17.8 % discount to XETRA closing price as of 27 September 2017, 16.8 % discount to TERP)
Use of proceeds	 Repayment of existing indebtedness, with any remainder to be used for general corporate purposes
Listing	 Regulated market of Frankfurt Stock Exchange (Prime Standard) and the regulated market of the Hamburg Stock Exchange
Distribution	 Public offer in Germany and Luxembourg  Offering in the US to QIBs under Rule 144A  Private placement to institutional investors outside the US in reliance on Reg S
Take-up ratio	 96%

37

Solid long-term and diversified financing portfolio

Debt maturity profile [USD m]

Facility	USD m
EUR Bond 2022	539
EUR Bond 2024	538
Other	30
Total Bonds	1,107
Total liabilities from finance lease contratcs	148
Total other financial liabilities	648
Vessel financings	3,752
Container financings	857
ABS programme	349
Other	734
Total liabilities to banks1)	5,692
Total financial liabilities	7,596
Average interest	~5%

2,541

Hapag-Lloyd with equity ratio of 40.9%

	31.12.2017	31.12.2016
Assets
Non-current assets	15,146.1	10,267.4
of which fixed assets	15,071.1	10,183.3
Current assets	2,630.8	1,698.0
of which cash and cash equivalents	725.2	602.1
Total assets	17,776.9	11,965.4
Equity and liabilities
Equity	7,263.3	5,341.7
Borrowed capital	10,513.6	6,623.7
of which non-current liabilities	7,197.8	3,836.7
of which current liabilities	3,315.8	2,787.0
of whih financial debt	7,595.5	4,414.9
thereof Non-current financial debt	6,750.6	3,448.4
Current financial debt	844.9	966.5
Total equity and liabilities	17,776.9	11,965.4

Balance sheet [USD m] Financial position [USD m]

	31.12.2016	31.12.2016
Cash and cash equivalents	725.2	602.1
Financial debt	7,595.5	4,414.9
Net debt	6,811.7	3,793.1
Unused credit lines	545.0	200.0
Liquidity reserve	1,270.2	802.1
Equity	7,263.3	5,341.7
Gearing (net debt / equity) (%)	71.0%	71.0%
Equity ratio (%)	40.9%	44.6%

Hapag-Lloyd with positive EBITDA of USD 1,198 m

	FY 2017	FY 2016	% change
Revenue	11,286.2	8,545.5	32%
Other operating income	149.9	107.3	40%
Transport expenses	-9,039.1	-7,031.6	29%
Personnel expenses	-770.8	-548.1	41%
Depreciation, amortization & impairment	-732.0	-531.4	38%
Other operating expenses	-493.2	-426.7	16%
Operating result	401.0	114.9	249%
Share of profit of equity-acc. investees	43.1	30.0	44%
Other financial result	22.0	-5.2	n.m.
Earnings before interest & tax (EBIT)	466.1	139.7	n.m.
EBITDA	1,198.1	671.1	79%
Interest result	-403.5	-220.8	83%
Income taxes	-27.3	-21.8	25%
Group profit / loss	35.3	-102.9	n.m.

Income statement [USD m] Transport expenses [USD m]

Transport expenses	922.1	925.3	0%
Maintenance/ repair/ other	30.2	27.7	9%
Container transport costs	258.1	276.1	-7%
Chartering leases and container rentals	96.3	135.9	-29%
Thereof Port, canal & terminal costs	400.9	385.5	4%
Cost of purchased services	785.4	825.3	-5%
Expenses for raw materials & supplies	136.7	100.0	37%
	FY 2017	FY 2016	% change
Transport expenses per TEU [USD m]
Transport expenses	9,039.1	7,031.6	29%
Maintenance/ repair/ other	295.8	210.5	41%
Container transport costs	2,530.0	2,098.3	21%
Chartering leases and container rentals	944.2	1,033.0	-9%
Thereof Port, canal & terminal costs	3,929.5	2,929.8	34%
Cost of purchased services	7,699.5	6,271.6	23%
Expenses for raw materials & supplies	1,339.6	760.0	76%
	FY 2017	FY 2016	% change

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Hapag-Lloyd Investor Relations

Ballindamm 25 20095 Hamburg Tel: +49(40) 3001-2896 ir@hlag.com https://www.hapag-lloyd.com/en/ir.html