Havila Kystruten AS

Earnings Release • Nov 27, 2024

Havila Kystruten AS: Third quarter 2024 accounts

Havila Kystruten AS: Third quarter 2024 accounts

Summary

The company continued its positive development in the third quarter of 2024,

with further improvements in both revenue and operational margins. Havila

Voyages reports a strengthened operating profit (EBITDA) as a result of solid

top-line growth.

Revenue in the third quarter of 2024 amounted to NOK 464 million, a significant

increase compared to NOK 226 million in the corresponding period last year. This

represents a growth of 62%, adjusted for the increase in the number of ships in

operation. For the first nine months of the year, total revenue was NOK 1,126

million, up from NOK 515 million last year.

The revenue growth is driven by increased occupancy rates, which rose to 78% in

the third quarter from 70% in the same period last year, combined with higher

average cabin revenue, which increased from NOK 4,000 to NOK 5,200. Onboard

sales increased, with average revenue per passenger night rising from NOK 690 to

NOK 770 in the third quarter compared to the same period last year. In Q3 2024,

the company changed its method for reporting KPIs and now includes the level of

onboard sales, which includes both pre-sales and services sold on board. Details

are provided in the company's quarterly presentation.

Operating expenses amounted to NOK 336 million in the quarter, and these were

mainly related to the ordinary operating costs for the four ships in the fleet.

The company is operated by a small but efficient onshore organization that

supports the ships in their daily operations. Increased goods and wage costs in

the quarter reflect both higher occupancies, increased onboard activity, and

this year's wage adjustment agreement.

EBITDA for the quarter ended at NOK 128 million, a significant improvement from

negative NOK 36 million in the third quarter of 2023, and a continuation of the

positive development from the previous quarter, Q2 2024.

The result and balance sheet are still affected by fluctuations in exchange

rates, especially related to the Norwegian krone against the euro, which led to

unrealized losses in the quarter. Adjusted for ship values that consider broker

values totalling MEUR 700, the company's adjusted equity is significantly

positive at MNOK 3 858.

The fleet's operational uptime was 97%. Havila Polaris cancelled an ongoing

roundtrip at the end of July due to overheating in one of the propulsion

systems. The ship was back in operation on August 3rd, and the system has now

been repaired by the Norwegian supplier. CO2 emissions were reduced by 30% in

the quarter compared to the reference figures from the Coastal Route in 2017.

The company achieved the goal of reducing food waste to less than 75 grams per

guest night in the third quarter, with an actual result of 66 grams.

As of the end of November, 73% of capacity for 2024 has already been sold, and

the company expects an average occupancy of around 75% for the year.

Future Development

The outlook for continued positive revenue growth in 2025 is promising. There is

a generally increasing demand for travel to Norway, and Havila Voyages' modern

and environmentally friendly ships have been very well received and have won

several international awards.

The company's sustainable profile is highly valued by the market, which

strengthens its position for further growth through both increased prices and

higher occupancy rates. With a more experienced organization and further

developed digital sales platforms, the company is focusing on realizing higher

revenues, especially through direct bookings in its own channels, which

historically has yielded significantly higher prices closer to the departure

time. As of the end of November, 41% of capacity for 2025 has already been

booked at a significantly higher price. The company will seek to balance

occupancy and price throughout the year to maximize margins.

Measures to increase onboard sales are in focus. Active work is being done with

both price and product-promoting initiatives to help increase revenue from

services and experiences on board.

The strategy of offering shorter trips opens further for new, exciting

commercial opportunities, targeting travellers with higher willingness to pay.

There is a particular potential to increase occupancy and the number of

passengers on the southbound route from Kirkenes to Bergen, which has

traditionally had lower occupancy than the northbound route. Targeted measures

and increased marketing have been implemented to exploit the potential.

Employees

Havila Kystruten had a total of 538 permanent employees as of September

30, 2024, of which 479 were seafarers and 59 in administration.

Contacts:

Chief Executive Officer: Bent Martini, +47 905 99 650

Chief Financial Officer: Aleksander Røynesdal, +47 413 18 114

This information is subject to the disclosure requirements pursuant to Section

5-12 the Norwegian Securities Trading Act