In September, Bruno Weissman, the sales director for Helrom, posted a video. He’s always posting videos of the company’s unique road-to-rail trains, carrying trailers around Europe. This video, however, was uploaded at an important juncture for Helrom as a business.
The images show a batch of 34 non-craneable semi-trailers, fresh out of the KRONE Trailer plant at Werlte in Lower Saxony, on their rail-mounted way to Grünheide in Brandenburg. 500 kilometres and just one kilometre on the road, boasts Helrom, thanks to their unique swing body rail car. That optimism contrasts with events earlier this year, where the wheels appeared to have come off Helrom, and it was heading for financial derailment. What has gone so horribly wrong since those promising months?
In May, Helrom was riding the crest of a wave. A Green Loan for €32.9m was secured from Société Générale and Deutsche Leasing Finance to purchase around 120 additional wagons, supporting six more train sets. The concept of horizontal loading was on a vertical trajectory. However, that up like a rocket trajectory came crashing down like a stick in July.
That month, Helrom filed for “preliminary insolvency proceedings”, citing an unsuccessful funding round. The company said it was restructuring and discontinuing one route that was “still in ramp-up” and had not reached sustainable utilisation.
Seeking a sustainable track
Since then, though, the company has been confidently promoting its services, most recently showing off its run across Germany for KRONE. In August, the insolvency practitioners said Helrom had a robust business model, and their job was to ensure that it continued in operation. Their focus is on finding a financially sustainable solution for the company’s future.
On the face of it, Helrom’s unique offer makes a compelling case. Its rail cars carry all the infrastructure required to load road trailers directly onto trains, without any site infrastructure, other than a length of hard standing adjacent to the rails. Yet, getting the message across and persuading road hauliers has perhaps grown at a slower rate than the company’s ambitions.
Track record
Since its founding in 2018, Helrom has expanded its operations, tripling its revenue to €23 million by 2024. The company operates six shuttle services connecting Germany with Austria and Italy. In August, Helrom launched a new connection between Düsseldorf, Germany, and Győr, Hungary. The service runs five times weekly. The company says that as of 30 September, another route has begun, linking Düsseldorf with Katowice in Poland. They say it will “ramp-up” to six weekly return workings.
The message is that Helrom has built a successful operational model for trailer-on-railcar services. “Despite the ongoing preliminary insolvency proceedings and the search for new investors, Helrom continues to win new customers, an unusual situation that underlines the company’s operational strength and the trust it enjoys among shippers,” said a spokesperson.
Seeking a backer
However, there is still jeopardy for the company. While it continues to operate successfully, PwC is engaged to conduct an investor search. Bottom line is that the company needs a new owner with pockets deep enough to make its operations catch up with its ambitions.
That might not be easy in the current commercial environment. Capital and investment are heavily concentrated on Artificial Intelligence (AI) compared to traditional engineering products like rail cars and modal shift.
A creditors’ committee is expecting that process to conclude by the end of this month. Roman Noack, the company’s chief executive, has said that the company is definitely at the beginning of its journey. He said they are focusing on their strengths and making their business model fit for the future.
*This story first appeared in the October print issue of WorldCargo News