Annual Financial Statements 2017
The CCH events carried out on the exhibition grounds during the revitalization phase are included in the Hamburg Messe figures.
for the fiscal year January 1 to December 31, 2017
A. Business and economic environment
1. The German trade fair and exhibition market
According to preliminary calculations by the Association of the German Trade Fair Industry (AUMA), the number of exhibitors at the 157 international and national trade fairs in Germany rose +2.5 percent in 2017 compared to the respective previous events. Rented stand space increased +2.0 percent. This growth is primarily attributable to the participations from abroad, which increased by around +5.0 percent in 2017. This was contrasted by a slight decline in the number of visitors again of -0.5 percent compared to the respective previous events. For the year 2018, AUMA expects the 178 planned inter-national and national trade fairs to see a further slight increase in exhibitor numbers and a renewed increase in visitor numbers. This assessment is supported by a survey of exhibitors who exhibit pri-marily at B2B trade fairs. This study was carried out by the market research institute Kantar TNS on behalf of AUMA. Accordingly, the exhibiting German companies want to increase their trade fair budgets for the years 2018/2019 by an average of +4.0 percent compared to 2016/2017.
2. Foreign business
The Foreign Ministry of Economics and Energy (BMWi) and the Federal Ministry of Food and Agricul-ture (BMEL) support German exhibitors at foreign trade fairs with their foreign trade fair program. The number of participations in foreign trade fairs amounted to 272 in 2017. To date, 249 participations are planned with the BMWi in 2018, including 51 in China and Hong Kong, 33 in Russia, 38 in the Mid-dle East, 26 in North America and 20 in Latin America. The BMEL is planning 39 participations in 2018. The main regions are Asia with 13 participations and the European countries outside the EU with 10 participations.
3. The national and international congress and conference business
Figures for the development of the national and international congress market are not yet available for 2017. According to the Meeting & Event Barometer, the number of participants rose slightly by +0.4 percent year-on-year to 394 million in 2016. The increase in the number of participants can be attribut-ed, among other things, to the increasing importance of major events (1,000+ participants) and to the continuing internationalization of the events industry in Germany. The number of foreign participants at congresses, conferences and events rose +18.0 percent from 2015 to 2016 to 33 million.
B. Business development of HMC
In 2017, HMC achieved its highest revenue in an odd-numbered fiscal year since the company was founded. Compared to the reference year 2015, revenue increased 10.8 million euros to 72.8 million euros. The largest share of revenue (around 71 percent) was generated by the Own Events and Guest Events Trade Fair and Foreign Business divisions.
1. 1. Hamburg Messe division
In terms of realized revenues, the Hamburg Messe division developed slightly better than planned.
HOME², a trade fair for real estate, construction and modernization, was held for the first time and enjoyed a successful premiere. Compared to the planning, the number of exhibitors was +15 percent higher while the number of visitors exceeded expectations by +19 percent.
REISEN HAMBURG benefited from the upturn in the caravan industry in the past fiscal year, with the result that rented space rose by +4 percent compared to the previous event despite a slight decline in the number of exhibitors. The number of visitors remained stable at the 2015 level. In addition to the existing themes “Camping & Mee(h)r”, “Cruise Dreams”, “New Travel” and “Camping by Night”, the for-mats “Travel Slam” and "Travel Photography” were introduced in 2017. Starting in 2018, the REISEN HAMBURG will be part of the OOHH! The LeisureWorlds of Hamburg Messe.
In 2017, INTERNORGA once again clearly underscored its position as the leading trade fair in the German gastronomy industry. In its 91st year, 1,248 exhibitors occupied the fully booked exhibition grounds including the lightweight construction hall B6.1. The INTERNORGA 2017 took place for the first time over just five days, one day shorter than normal. Nevertheless, the number of visitors in-creased +2 percent.
For the seventh year in a row, the HANSEBOOT ANCORA BOAT SHOW took place at ancora Marina in Neustadt/Holstein. The number of exhibitors increased +2 percent compared to 2016.
SEATRADE EUROPE, the conference trade fair for cruises and river cruises, took place for the first time in cooperation with UBM. Compared to the previous year, this event attracted +18 percent more visitors and conference participants from Germany and abroad and +36 percent more exhibitors. For-eign exhibitors accounted for 87 percent of all exhibitors.
For the second time, HMC hosted South Asia's largest and most important maritime trade fair together with Informa Exhibitions at the Bombay Convention & Exhibition Center in Mumbai. Around 300 exhibitors from 23 countries and about 6,300 visitors from 31 countries took part in INMEX SMM INDIA.
HAMBURG MOTOR CLASSICS represented another premiere on the exhibition grounds. Here, 160 exhibitors presented their products in three halls.
The HANSEBOOT took place for the last time in 2017. HMC has decided not to continue the HANSE-BOOT in this form due to economic considerations. In 2018, there will be a water sports fair put on by the German Boat and Shipbuilder Association (DBSV) under the name HAMBURG BOAT SHOW on the Hamburg Messe grounds. In this case, the DBSV, Messe Friedrichshafen and HMC have joined forces to form a joint venture.
MINERALIEN HAMBURG, Northern Europe’s largest mineral exchange, recorded a year-on-year de-cline of -4 percent in rented exhibition space. The number of participating countries, however, in-creased from 31 to 33.
The Guest Events division developed better than planned in the year under review (revenue: +5 per-cent). A total of 31 guest events (2015: 36) were held at the HMC Fairgrounds. The lower number of events compared to the reference year 2015 is mainly due to the transitional solution for CCH events. Some of the largest events were the AIRCRAFT INTERIORS EXPO, NORDSTIL and FESPA.
In fiscal year 2017, a total of 40 trade fairs and exhibitions were held (reference year 2015: 44), includ-ing eight own events (seven on HMC grounds, one in Neustadt/Holstein) and one event with Informa Exhibitions in India. 622,604 visitors attended the events held in Germany – representing growth of +56,911 visitors compared to the reference year 2015 (565,693). The gross rented space for trade fairs and exhibitions fell slightly compared to the reference year 2015 and amounted to 772,480 square meters. This decline is due to the provision of a transitional solution for CCH events on the exhibition grounds during the revitalization of the CCH. Gross hall space of 306,081 square meters was rented for CCH events held on the exhibition grounds in 2017.
2. 2. Foreign Business division
Every year, HMC organizes numerous joint participations in trade fairs abroad on behalf of the Feder-al Ministry of Economics and Energy (BMWi), the Federal Ministry of Food and Agriculture (BMEL) and on its own initiative. This year, the focus of the participations was on the maritime, oil and gas, hotel, gastronomy and airport construction and technology industries. A highlight of our activities abroad was the successful organization and realization of the German Pavilion at the EXPO in Astana on behalf of the BMWi.
3. 3. CCH division
Since January 1, 2017, the CCH has been closed for the revitalization prescribed by the Free and Hanseatic City of Hamburg in 2014. During the renovation period, CCH customers will be offered an interim solution on the exhibition grounds. In 2017, the following events took place as part of this transitional solution: The DDG Diabetes Congress with 7,000 participants, the Annual General Meeting of Beiersdorf AG with 1,550 participants, the Annual General Meeting of Lufthansa AG with 1,400 par-ticipants and the Annual General Meeting of HHLA with 1,000 participants.
The G20 summit is also recognized under the CCH division.
C. Economic situation
1. Development of revenue
In 2017, HMC recorded revenue of 72.8 million euros (2015: 62.0 million euros). The total revenue of 2017 breaks down to the individual divisions as follows: Trade Fair: 20.6 million euros, CCH: 7.4 mil-lion euros, Guest Events: 12.5 million euros, Foreign Business: 18.8 million euros, Services: 10.6 mil-lion euros. Revenue from the Property division totaled 2.8 million euros.
2. Profit/loss for the year
The 2017 fiscal year ended with a loss for the year of -22.4 million euros before loss absorption by HGV (2015: -33.2 million euros). The higher gross profit in the Hamburg Messe division and the organ-ization of the G20 Summit led to this improvement in earnings compared to the reference year 2015. On the other hand, the closure of the CCH contributed to the improved result, thanks in part to the discontinuation of loan interest and depreciation as well as the transfer of fixed assets and loans from the 2007 CCH expansion through gains on disposals.
At the end of 2017, HMC had 300 (2016: 292) employees, of whom 273 had permanent contracts and 27 had fixed-term contracts (2016: 257 permanent and 35 fixed-term). Expressed in FTEs, HMC had around 254Capacities (2016: 262) by the year's end. In addition, HMC provided an average of 20 trainee positions for prospective event, office and IT administrators, event technology special-ists and Bachelor of Arts (BA) students participating in dual study programs.
HMC would like to further increase the proportion of women in management positions below the Man-agement Board level. The goal of increasing the share to at least 40 percent by 2017 was already achieved in 2016.
4. 4. Net assets
Total assets decreased by 35.6 million euros to 81.6 million euros in the year under review, resulting in an increase in the equity ratio from 10.0 percent to 14.3 percent.
5. Financial position
A control and profit transfer agreement and a Group clearing agreement exist with the parent compa-ny HGV. The liquidity of the company is thereby guaranteed at all times.
D. Outlook, risks and opportunities of future development
Due to the rotation of events, more own events will take place in fiscal year 2018 than in the odd-numbered years. HMC is planning to continue its profitable growth and break even over a two-year period by 2025. Hence, a strategy entitled “ROAD TO 2025” was developed, which describes the chal-lenges, goals, and fields of action to reach this goal. Growth will be primarily achieved through the expansion of HMC’s own trade fairs, the acquisition of profitable guest events and the hosting of additional events in the CCH once it has reopened. Collaborations with other domestic and foreign trade fair organizers will also be considered and larger numbers of events acquired for the uneven years wherever possible.
HMC anticipates revenue of 99.9 million euros for the 2018 fiscal year, which corresponds to a decline in revenue of -9.9 percent compared to the reference year. This decrease is mainly due to the closure of the CCH for revitalization purposes.
Owing to the significant financing costs for leasing the “Neue Messe”, the company expects to post a net loss before loss absorption. Property costs will continue to have a negative impact on earnings in the coming years. Higher losses are also expected in the future, especially in uneven years. The cur-rent strategy calls for HMC to break even over a two-year period by 2024-25.
HGV will absorb the losses that are expected in the coming years within the scope of the existing profit and loss transfer agreement.
3. Risk report
HMC maintains a risk management system that enables a timely and systematic analysis and evalua-tion of the company’s exposure to risk as well as the development of pertinent countermeasures. The analyses and assessments relate to both strategic and operational risks.
At present, HMC is unaware of any risks that could jeopardize its future development.
With regard to the revitalization of the CCH, the EU Commission imposed conditions under state aid law, which also included a public, non-discriminatory and generally accessible award procedure for the operation of the CCH (concession contract). In this award procedure, HMC was awarded the con-tract to operate the CCH for a fixed term of 25 years. The corresponding service concession agree-ment was signed on October 11, 2017.
No financial risks are apparent.
Hamburg, February 26, 2018
President and Chief Executive Officer
Chief Financial Officer
The Supervisory Board regularly reviewed the situation and development of Hamburg Messe und Congress GmbH in the past fiscal year. In the year under review, it performed the duties incumbent upon it by law and the Articles of Association. The Supervisory Board continuously advised and monitored the Management Board of Hamburg Messe und Congress GmbH in its management of the company.
The Supervisory Board complied with the requirements of the Hamburg Corporate Govern-ance Code and issued a statement of compliance together with the company’s Management Board.
The Management Board informed the Supervisory Board regularly, timely and comprehen-sively in written and verbal form about the relevant issues of corporate planning, strategic development and the results achieved in the company, including the risk situation.
In the year under review, four ordinary meetings and one special meeting of the Supervisory Board were held, and four resolutions of the Supervisory Board were adopted by written cir-cular. The Finance Committee and the Construction Committee each met twice. The Human Resources Committee held four ordinary meetings and three special meetings. One resolu-tion was adopted by written circular.
On June 28, 2017, the Annual General Meeting of Hamburg Messe und Congress GmbH appointed FIDES Treuhand GmbH & Co. KG (FIDES) to audit the company’s annual financial statements and to ensure the company’s due and proper conduct of business for the fiscal year from January 1 to December 31, 2017.
FIDES audited the annual financial statements – consisting of balance sheet, income state-ment and notes – together with the bookkeeping system and the management report for the fiscal year from January 1 to December 31, 2017.
The audit has not led to any reservations. In the opinion of FIDES and based on the findings of its audit, the annual financial statements comply with the legal requirements and give a true and fair view of the company’s net assets, financial position and results of operations in ac-cordance with the German principles of proper accounting. The management report is con-sistent with the annual financial statements, provides a suitable overview of the company’s situation and suitably presents the opportunities and risks of future development.
The Finance Committee at its meeting on May 28, 2018, and the Supervisory Board at its meeting on June 18, 2018, examined the annual financial statements, the management report and the report from FIDES in detail. The Supervisory Board has no objections to these docu-ments and agrees with the results of the auditor’s report. The Supervisory Board approves both the management report and the annual financial statements as of December 31, 2017.
The Supervisory Board would like to thank the Management Board and all the employees for their hard work and dedication in the company’s best odd-numbered year to date.
Hamburg, June 2018
Johann C. Lindenberg
Chairman of the Supervisory Board
Johann C. Lindenberg
Chairman of the Supervisory Board, former National Chairman of Unilever Deutschland
Managing Director, City Management Hamburg
Unit Head, Fundamental and Cross-section Tasks of Investment Management, Finance Authority Hamburg
Head of the Convention and Event Technology department, Hamburg Messe und Congress GmbH
Managing Director, Gastwerk Hotel Hamburg Verwaltungsgesellschaft mbH
Project Manager, Hamburg Messe und Congress GmbH
Dr. Rainer Klemmt-Nissen
Managing Director, HGV Hamburger Gesellschaft für Vermögens- und Beteiligungsmanagement mbH
Office Manager for Economic Development, Foreign Trade, and Agriculture of the Department for Economics, Transport and Innovation of the Free and Hanseatic City of Hamburg
Dr. Renate Krümmer
Owner of KRÜMMER fine art e. K
Chairperson Works Council of Hamburg Messe und Congress GmbH
Technical Project Manager, Hamburg Messe und Congress GmbH
Hamburg Corporate Governance Code (HCGC)
The Management Board and the Supervisory Board of Hamburg Messe und Congress (HMC) hereby declare:
“With one exception, Hamburg Messe und Congress GmbH complied with all the regulations of the Hamburg Corporate Governance Code, for which the Management Board and Supervisory Board were responsible during the 2017 fiscal year. The following item was not observed:
- Section 5.1.5: The six-week period for distributing the minutes regarding resolutions made by the Supervisory Board could not be adhered to at all times as the draft minutes had to be approved prior to their publication and the approval processes were not completed in time.”
In the 2017 fiscal year, Mr. Aufderheide received total gross compensation in the amount of 298.021,42 euros. Dr. Kopp, who left the company as of October 31, 2017, received total gross compensation in the amount of 242.318,74 euros. The breakdown of the total compensation can be viewed online at www.hamburg-messe.de.
Hamburg, June 2018
Johann C. Lindenberg
Chairman of the Supervisory Board
President and Chief Executive Officer
Chief Financial Officer