OREANDA-NEWS. AS Tallink Grupp Unaudited Consolidated Interim Report Q4 2015.

AS Tallink Grupp and its subsidiaries (the Group) carried a total of 9.0 million passengers in the 2015 financial year which is 1.1% more compared to the year before. The Group’s unaudited revenue increased by 2.6% to all-time high of EUR 945.2 million and EBITDA increased by 20.5% to a record EUR 181.4 million. Unaudited net profit more than doubled compared to last year and amounted to EUR 59.1 million or EUR 0.09 per share. The cash flow from operating activities increased by EUR 41.2 million and totaled to EUR 191.9 million.

The increase in the Group’s results is mainly attributed to the growth in passenger number, higher on-board revenue per passenger, higher charter revenue and lower operating costs. The passenger number grew steadily in most routes and the Group regained market share from the direct competition.

The revenue growth is driven by higher restaurant & shop sales and charter revenues. The restaurant & shop sales increase 2.7% or EUR 13.1 million was supported by higher passenger number and also higher on-board sales per passenger. The charter revenues increased by 13.6% or EUR 6.4 million and the cargo revenues by 1.3% compared to 2014. Proactive marketing and sales activities led to an increase of passenger number and resulted in lower ticket revenue per passenger, the total ticket revenue declined by 1.1%.

Estonia-Finland route passenger number increased by 5.0% and cargo units by 17.9%, the segment revenue increased by 5.1%. The Finland-Sweden route passenger number grew by 4.1% mostly due to more departures compared to 2014, the cargo units transported decreased by 26.2% and segment revenue increased by 2.9%. The shift of cargo volumes between the routes is the result of one cargo vessel moved from Finland-Sweden route to Estonia-Finland route from 2015. The Latvia-Sweden route passenger and cargo volume decreased by 32.2% and by 46.5% respectively as only one vessel was operating on the route since mid-2014.

The lower energy prices globally enabled smooth adoption to the more environmental friendly low sulphur fuel and the previously highlighted risk of increasing fuel cost did not materialise. Following the market prices the Group’s average fuel price in 2015 was 5% lower compared to 2014. The total annual fuel consumption reduced by 13%, the saving is attributed to optimisations in vessel operations and changes in the fleet. Lower total fuel consumption and price resulted in approximately EUR 20 million less fuel cost compared to 2014.

In the fourth quarter (1 October - 31 December) of the 2015 financial year the Group carried 2.1 million passengers which is 3.6% more compared to the fourth quarter last year and unaudited revenue increased 1.6% to the total of EUR 227.6 million.

The Group’s fourth quarter profitability is affected by EUR 9.5 million one-off costs (book loss and transaction costs) related to sale of fast ferry Superstar. The fourth quarter EBITDA decreased by EUR 11.1 million to EUR 29.9 million compared to the same period last year, the adjusted EBITDA from normal operations, excluding the one off costs is EUR 39.4 million.

The Estonia-Finland route fourth quarter revenue increased 5.3% compared to same period last year. The increase is driven mainly by a 6.3% growth in the passenger number. The growth of 15.4% in cargo units transported is supported mainly by added capacity.

The Finland-Sweden routes fourth quarter revenue was on level with last year, although the passenger number grew by 2.2%. The number of cargo units transported decreased by 27.7% due to reduced capacity.

The Estonia-Sweden route revenue increase of 11.7% was driven by a 2.0% increase of passenger number and higher on board sales per passenger, cargo volume was on level with last year. The Latvia-Sweden route showed an 11.4% decline in the passenger number, cargo volume was on level with last year.

The Group’s restaurants and shop sales increased by EUR 6.3 million or 5.3% in the fourth quarter compared to the same period last year. The sales growth is driven by the growth of the passenger number and higher average on-board revenue per passenger.

The revenue from the chartered out vessels has reduced in the fourth quarter compared to the same period last year due to fewer ships were chartered out. Two ships previously chartered out were sold in the second quarter of 2015.

AS Tallink Grupp signed a contract with Meyer Turku Oy in February 2015 for the construction of its new EUR 230 million LNG powered fast ferry. The start of production of the new LNG fast ferry started on the 4th of August 2015 at Meyer Turku shipyard and the delivery of the vessel is planned in the beginning of 2017.

In order to be ready for the delivery of the new generation LNG fast ferry to the Tallinn-Helsinki route Shuttle service early 2017, the Group decided to sell and charter back the fast ferry Superstar. The ownership of the vessel was transferred to the buyer on 1st of December 2015. The Group continues to operate the vessel under the charter agreement until the beginning of 2017, when the new LNG fast ferry will start to operate on Tallinn-Helsinki route Shuttle service.

In financial year 2015 the Group sold three vessels. The total cash proceeds from the sale EUR 115.4 million are mainly used to repay loans and for the down payment of the new LNG fast ferry under construction.

In the fourth quarter the Group’s net debt decreased by EUR 116.3 million to a total of EUR 467.4 million and the net debt to EBITDA ratio improved further to a solid 2.6 at the end of fourth quarter.

The Group’s fourth quarter total finance costs decreased by EUR 3.4 million due to lower cost from foreign exchange revaluations. The interest cost increased compared to last year, including one-off cost of premature termination of loan contract related to the sale of vessel.

The unaudited net loss for the fourth quarter of the 2015 financial year was EUR 1.3 million or EUR -0.002 per share compared to the net profit of EUR 8.4 million or EUR 0.013 per share in the same period last year. The Group’s net profit for the 2015 financial year was EUR 59.1 million or EUR 0.09 per share compared to the EUR 27.3 million or EUR 0.04 per share in the same period last year.

Cash flow from operations increased by EUR 9.3 million in fourth quarter compared to the same period last year. The total liquidity, cash and unused credit facilities, at the end of the fourth quarter was EUR 153.6 million providing a strong financial position. The Group had EUR 82.0 million in cash and equivalents and the total of unused credit lines were at EUR 71.6 million. 

Q4 KEY FIGURES 

    2015
Oct-Dec		 2014
Oct-Dec		 Change
Revenue EUR million 227.6 224.1 1.6%
Gross profit EUR million 50.2 49.4 1.7%
Gross margin   22.0% 22.0%  
EBITDA EUR million 29.9 41.0 -27.1%
EBITDA adjusted 1 EUR million 39.4 41.0 -3.9%
EBITDA margin adjusted 1   17.3% 18.3%  
Net profit for the period EUR million -1.3 8.4 -115.8%
Net profit for the period adjusted 1 EUR million 13.7 8.4 63.1%
Net profit margin adjusted 1   6.0% 3.7%  
         
Depreciation and amortization EUR million 19.4 20.9 -7.1%
Investments EUR million 13.8 18.1 -23.8%
         
Weighted average number of ordinary shares outstanding 2 669,882,040 669,882,040 0.0%
Earnings per share EUR 0.00 0.01 -115.8%
         
Number of passengers   2,125,361 2,051,410 3,6%
Number of cargo units   78,136 77,816 0.4%
Average number of employees   6,769 6,715 0.8%
         
    31.12.2015 30.09.2015  
Total assets EUR million 1,538.1 1,652.6 -6.9%
Interest-bearing liabilities EUR million 549.3 662.7 -17.1%
Net debt EUR million 467.4 583.6 -19.9%
Total equity EUR million 824.5 825.3 -0.1%
         
Equity ratio   53.6% 49.9%  
Net debt to EBITDA   2.6 3.0  
         
Number of ordinary shares outstanding 2 669,882,040 669,882,040 0.0%
Shareholders’ equity per share EUR 1.23 1.23 -0.1%
           

EBITDA:  Earnings before net financial items, taxes, depreciation and amortization;
Earnings per share: net profit / weighted average number of shares outstanding;
Equity ratio: total equity / total assets;
Shareholder’s equity per share: shareholder’s equity / number of shares outstanding;
Gross margin: gross profit / net sales;
EBITDA margin: EBITDA / net sales;
Net profit margin: net profit / net sales;
Net debt: Interest bearing liabilities less cash and cash equivalents;
Net debt to EBITDA: Net debt / 12-months trailing EBITDA. 
1 Vessel sale result in the fourth quarter of 2015 is eliminated.
2 Share numbers exclude own shares.

 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(unaudited, in thousands of euros) 01.10.2015- 01.10.2014- 01.01.2015- 01.01.2014-
  31.12.2015 31.12.2014 31.12.2015 31.12.2014
         
Revenue (Note 3) 227,631 224,141 945,203 921,466
Cost of sales -177,439 -174,782 -721,780 -739,789
Gross profit 50,192 49,359 223,423 181,677
           
Marketing expenses -16,777 -15,771 -63,578 -62,654
Administrative expenses -13,001 -13,638 -47,311 -49,211
Other income -377 709 983 1,696
Other expenses -9,517 -496 -10,254 -854
Result from operating activities 10,520 20,163 103,263 70,654
         
Finance income (Note 4) 3,301 4,623 12,808 11,760
Finance costs (Note 4) -14,317 -19,059 -46,964 -52,443
         
Share of profit of equity-accounted investees 64 24 64 24
Profit/-loss before income tax -432 5,751 69,171 29,995
           
Income tax -896 2,633 -10,101 -2,734
           
Net profit/-loss for the period -1,328 8,384 59,070 27,261
         
Other comprehensive income/-expense        
Items that may be reclassified to profit or loss        
Exchange differences on translating foreign operations 416 242 160 286
Other comprehensive income/-expense for the period 416 242 160 286
Total comprehensive income/-expense for the period -912 8,626 59,230 27,547
         
Earnings per share (in EUR per share)        
  - basic (Note 5) -0.00 0.01 0.09 0.04
  - diluted (Note 5) -0.00 0.01 0.09 0.04

 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(unaudited, in thousands of euros) 

ASSETS 31.12.2015 31.12.2014
       
Current assets    
Cash and cash equivalents 81,976 65,311
Trade and other receivables 36,583 38,210
Prepayments 6,498 5,448
Inventories 29,197 31,315
Total current assets 154,254 140,284
       
Non-current assets    
Investments in equity-accounted investees 350 286
Other financial assets 308 252
Deferred income tax assets 19,410 21,338
Investment property 300 300
Property, plant and equipment (Note 7) 1,311,418 1,467,964
Intangible assets (Note 8) 52,726 55,174
Total non-current assets 1,384,512 1,545,314
       
TOTAL ASSETS 1,538,766 1,685,598
       
       
LIABILITIES AND EQUITY    
     
Current liabilities    
Interest bearing loans and borrowings (Note 9) 81,889 149,850
Trade and other payables 88,480 91,236
Income tax liability 4,567 1,300
Deferred income 28,906 29,408
Derivatives (Note 6) 42,863 41,982
Total current liabilities 246,705 313,776
       
Non-current liabilities    
Interest bearing loans and borrowings (Note 9) 467,447 593,532
Other payables 192 0
Total non-current liabilities 467,639 593,532
TOTAL LIABILITIES 714,344 907,308
       
EQUITY    
Equity attributable to equity holders of the parent    
Share capital 404,290 404,290
Share premium 639 639
Reserves 65,083 70,129
Retained earnings 354,410 303,232
Total equity attributable to equity holders of the parent 824,422 778,290
TOTAL EQUITY 824,422 778,290
       
TOTAL LIABILITIES AND EQUITY 1,538,766 1,685,598

 

CONSOLIDATED CASH FLOW STATEMENT

(unaudited, in thousands of euros) 01.01.2015- 01.01.2014-
    31.12.2015 31.12.2014
Cash flows from operating activities    
Net profit/-loss for the period 59,070 27,261
Adjustments 132,851 125,629
Changes in receivables and prepayments related to operating activities 1,463 -2,291
Changes in inventories 2,118 2,142
Changes in liabilities related to operating activities -4,139 -2,103
Income tax paid 553 71
  191,916 150,709
Cash flow used in investing activities    
Purchase of property, plant and equipment and intangible assets (Notes 7, 8, 9) -43,629 -49,148
Proceeds from disposals of property, plant and equipment 115,370 215
Proceeds from other financial assets 229 0
Interest received 74 140
  72,044 -48,793
Cash flow used in financing activities    
Repayment of loans (Note 9) -133,263 -89,842
Change in overdraft (Note 9) -59,052 43,993
Payment of finance lease liabilities (Note 9) -80 -75
Interest paid -33,210 -33,270
Payments for settlement of derivatives -4,045 -3,985
Payment of transaction costs related to loans -1,429 0
Dividends paid (Note 12) -13,398 -20,096
Income tax on dividends paid -2,818 -5,342
  -247,295 -108,617
       
TOTAL NET CASH FLOW 16,665 -6,701
       
Cash and cash equivalents:    
- at the beginning of period 65,311 72,012
- increase (+) / decrease (-) 16,665 -6,701
- at the end of period 81,976 65,311