Tallink Grupp

AS Tallink Grupp Unaudited Consolidated Interim Report Q3 2015

Tallinn, 2015-11-12 08:50 CET (GLOBE NEWSWIRE) --

AS Tallink Grupp Unaudited Consolidated Interim Report Q3 2015

In the third quarter (1 July ? 30 September) of the 2015 financial year AS

Tallink Grupp and its subsidiaries? (the Group) carried 2.7 million passengers

which is 5.5% more compared to the third quarter last year. The Group?s

unaudited revenue for the third quarter of 2015 increased by EUR 10.9 million

or 4.2% year on year to the total of EUR 273.6 million, EBITDA increased by EUR

12.8 million or 20.1% to the total of EUR 76.8 million, compared to the same

period last year. Net profit increased by EUR 9 million or 25.1% to the total

of EUR 45.2 million, compared to the same period last year.

The Group?s revenue for the first nine months of 2015 was EUR 717.6 million and

increased by EUR 20.3 million or 2.9% year on year comparison. EBITDA increased

by EUR 41.9 million to the total of EUR 151.5 million and net profit increased

by EUR 41.5 million to the total of EUR 60.4 million, compared to the same

period last year.

The Estonia-Finland route third quarter revenue increased by 5.6% compared to

same period last year. The increase is driven mainly by an 8.9% growth in the

passenger number. The passenger number peaked in July when Group served a

record number of 600 thousand passengers, which is an all-time high monthly

passenger number on that route. The growth of 15.3% in cargo units transported

is supported mainly by added capacity.

The Finland-Sweden routes third quarter revenue increased by 6.5% compared to

the same period last year, driven by 8.4% growth in the passenger number. The

number of cargo units transported decreased by 28.8% due to reduced capacity.

The Estonia-Sweden route passenger number increased by 1.5% and cargo volumes

decreased by 8.3%. The Latvia-Sweden route, operating with only one vessel

compared to two vessels last year, showed a 25.6% decline in the passenger

number and cargo units transported decreased by 35.2%.

The Group?s restaurants and shop sales increased by EUR 9 million or 6.8% in

the third quarter, compared to the same period last year, the sales growth is

supported mainly by the growth in the passenger number. The upgrades to

restaurant and shop concept throughout the fleet in past year, combined with

the operational changes, have resulted in higher average on-board revenue per

passenger.

The revenue from the chartered out vessels has reduced in the third quarter

compared to the same period last year due to fewer ships in charter. Two ships

previously in charter were sold in the second quarter of 2015.

In the third quarter, the summer period high season, the Group experienced

strong price competition. The proactive marketing activities, improved

visibility of sales campaigns and earlier investments into increasingly

important online sales solutions has enabled the Group to reclaim the market

share on its main routes and increase the total revenue.

In February 2015 AS Tallink Grupp signed a contract for the construction of the

new generation LNG powered fast ferry. The new fast ferry is being built by

Meyer Turku Oy and will cost around 230 million euros. The start of production

of the new LNG fast ferry was celebrated on the 4th of August 2015 at Meyer

Turku shipyard and the delivery of the vessel is planned in the beginning of

2017. The new LNG fast ferry is going to operate on the Tallinn-Helsinki route

shuttle service.

In order to be ready for the delivery of the new generation LNG fast ferry to

the Tallinn-Helsinki route early 2017, the Group has decided to sell the fast

ferry Superstar, at present operating on the route shuttle service. The fast

ferry Superstar will be sold to Corsica Ferries Group, concurrently the parties

have entered into bareboat charter agreement and the Group will continue to

operate the fast ferry Superstar on its Tallinn-Helsinki route shuttle service

until the beginning of 2017, when the new LNG fast ferry will start to operate

on the route. Change of the ownership of the fast ferry Superstar and start of

the charter period is planned in December 2015.

In the third quarter of the 2015 financial year the Group?s gross profit

amounted to EUR 84.8 million and EBITDA to EUR 76.8 million being respectively

EUR 15.2 million and EUR 12.9 million more compared to the same period last

year. The increase in the Group?s results is mainly attributed to the growth in

passenger number, higher on-board revenue per passenger and decreased costs

related to operations.

The Group?s net debt decreased by EUR 30.8 million to a total of EUR 583.6

million and the net debt to EBITDA ratio was 3.0 at the end of third quarter.

The Group?s interest cost reduced by EUR 2.9 million, combined with less gain

from foreign exchange revaluations, the total finance costs increased by EUR

1.3 million compared to the third quarter last year.

The unaudited net profit for the third quarter of the 2015 financial year was

EUR 45.2 million or EUR 0.07 per share compared to the net profit of EUR 36.2

million or EUR 0.05 per share in the same period last year. The Group?s net

profit for the nine months of the 2015 financial year was EUR 60.4 million or

EUR 0.09 per share compared to the EUR 18.9 million or EUR 0.03 per share in

the same period last year.

The total dividend of EUR 13.4 million (0.02 euros per share) was paid out in

the beginning of July 2015 according to the decision of Annual General Meeting

from June 2015.

Cash flow from operations increased by EUR 4.5 million in third quarter

compared to the same period last year. The total liquidity, cash and unused

credit facilities, at the end of the third quarter was EUR 100.4 million

providing a strong financial position. At the end of the third quarter of 2015

the Group had EUR 79.1 million in cash and equivalents and the total of unused

credit lines were at EUR 21.3 million.

Q3 KEY FIGURES 2015 2014 Change

July-Sep July-Sep

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Revenue EUR million 273.6 262.7 4.2%

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Gross profit EUR million 84.8 69.6 21.8%

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Gross margin 31.0% 26.5%

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EBITDA EUR million 76.8 64.0 20.1%

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EBITDA margin 28.1% 24.4%

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Net profit for the EUR million 45.2 36.2 25.1%

period

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Net profit margin 16.5% 13.8%

--------------------------------------------------------------------------------

Depreciation and EUR million 18.4 19.3 -4.7%

amortization

--------------------------------------------------------------------------------

Investments EUR million 11.3 10.6 6.6%

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Weighted average number of ordinary shares 669,882,040 669,882,040 0.0%

outstanding

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Earnings per share EUR 0.07 0.05 25.1%

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Number of passengers 2,701,412 2,561,257 5.5%

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Number of cargo units 76,062 76,830 -1.0%

--------------------------------------------------------------------------------

Average number of 7,040 7,181 -2.0%

employees

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----------------------------------------------- -------

--------------------------

30.09.2015 30.06.2015

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Total assets EUR million 1,652.6 1,665.5 -0.8%

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Interest-bearing EUR million 662.7 695.5 -4.7%

liabilities

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Net debt EUR million 583.6 614.5 -5.0%

--------------------------------------------------------------------------------

Total equity EUR million 825.3 780.2 5.8%

--------------------------------------------------------------------------------

Equity ratio 49.9% 46.8%

--------------------------------------------------------------------------------

Net debt to EBITDA 3.0 3.4

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Number of ordinary shares outstanding1 669,882,040 669,882,040 0.0%

--------------------------------------------------------------------------------

Shareholders? equity per EUR 1.23 1.16 5.8%

--------------------------------------------------------------------------------

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 Share numbers exclude own shares.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(unaudited, in thousands of 01.07.2015- 01.07.2014- 01.01.2015- 01.01.2014-

euros)

30.09.2015 30.09.2014 30.09.2015 30.09.2014

\================================================================================

Revenue (Note 3) 273,557 262,656 717,572 697,325

Cost of sales -188,803 -193,085 -544,341 -565,007

Gross profit 84,754 69,571 173,231 132,318

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Marketing expenses -15,085 -15,084 -46,801 -46,883

Administrative expenses -10,992 -10,296 -34,310 -35,573

Other income -125 462 1,360 987

Other expenses -156 -18 -737 -358

--------------------------------------------------------------------------------

Result from operating 58,396 44,635 92,743 50,491

activities

--------------------------------------------------------------------------------

Finance income (Note 4) 2,210 3,270 9,507 7,137

Finance costs (Note 4) -12,039 -11,747 -32,647 -33,384

Profit/-loss before income 48,567 36,158 69,603 24,244

tax

--------------------------------------------------------------------------------

Income tax -3,355 -8 -9,205 -5,367

--------------------------------------------------------------------------------

Net profit/-loss for the 45,212 36,150 60,398 18,877

period

--------------------------------------------------------------------------------

Other comprehensive

income/-expense

Items that may be

reclassified to profit or

loss

Exchange differences on -202 36 -256 44

translating foreign

operations

Other comprehensive -202 36 -256 44

income/-expense for the

period

--------------------------------------------------------------------------------

Total comprehensive 45,010 36,186 60,142 18,921

income/-expense for the

period

--------------------------------------------------------------------------------

Earnings per share (in EUR

per share)

- basic (Note 5) 0.07 0.05 0.09 0.03

- diluted (Note 5) 0.07 0.05 0.09 0.03

--------------------------------------------------------------------------------

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(unaudited, in thousands of euros)

ASSETS 30.09.2015 31.12.2014

\================================================================================

Current assets

Cash and cash equivalents 79,107 65,311

--------------------------------------------------------------------------------

Trade and other receivables 42,022 38,210

Prepayments 10,938 5,448

Inventories 28,676 31,315

Total current assets 160,743 140,284

--------------------------------------------------------------------------------

Non-current assets

Investments in equity-accounted investees 286 286

--------------------------------------------------------------------------------

Other financial assets 315 252

Deferred income tax assets 21,349 21,338

Investment property 300 300

Property, plant and equipment (Note 7) 1,416,648 1,467,964

Intangible assets (Note 8) 52,941 55,174

---------------------------------------------------------

Total non-current assets 1,491,839 1,545,314

--------------------------------------------------------------------------------

---------------------------------------------------------

TOTAL ASSETS 1,652,582 1,685,598

--------------------------------------------------------------------------------

LIABILITIES AND EQUITY

\================================================================================

Current liabilities

Interest bearing loans and borrowings (Note 9) 139,672 149,850

--------------------------------------------------------------------------------

Trade and other payables 83,546 91,236

Income tax liability 6,800 1,300

Deferred income 30,254 29,408

Derivatives (Note 6) 43,985 41,982

Total current liabilities 304,257 313,776

--------------------------------------------------------------------------------

Non-current liabilities

-----------------------

Interest bearing loans and borrowings (Note 9) 523,062 593,532

---------------------------------------------------------

Total non-current liabilities 523,062 593,532

--------------------------------------------------------------------------------

TOTAL LIABILITIES 827,319 907,308

--------------------------------------------------------------------------------

EQUITY

--------------------------------------------------------------------------------

Equity attributable to equity holders of the parent

--------------------------------------------------------------------------------

Share capital 404,290 404,290

Share premium 639 639

Reserves 71,465 70,129

Retained earnings 348,869 303,232

--------------------------------------------------------------------------------

Total equity attributable to equity holders of the 825,263 778,290

parent

--------------------------------------------------------------------------------

TOTAL EQUITY 825,263 778,290

--------------------------------------------------------------------------------

TOTAL LIABILITIES AND EQUITY 1,652,582 1,685,598

--------------------------------------------------------------------------------

CONSOLIDATED CASH FLOW STATEMENT

(unaudited, in thousands of euros) 01.01.2015- 01.01.2014-

30.09.2015 30.09.2014

Cash flows from operating activities

Net profit/-loss for the period 60,398 18,877

Adjustments 91,250 92,806

Changes in receivables and prepayments related to -8,089 -6,165

operating activities

Changes in inventories 2,639 5,077

Changes in liabilities related to operating activities -7,103 -3,973

Income tax paid -490 108

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138,605 106,730

--------------------------------------------------------------------------------

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Cash flow used in investing activities

Purchase of property, plant and equipment and -29,823 -30,919

intangible assets (Notes 7, 8, 9)

Proceeds from disposals of property, plant and 25,004 180

equipment

Interest received 57 78

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-4,762 -30,661

--------------------------------------------------------------------------------

-------------------------------------------------------

Cash flow used in financing activities

Repayment of loans (Note 9) -68,962 -59,946

Change in overdraft (Note 9) -8,700 31,069

Payment of finance lease liabilities (Note 9) -60 -54

Interest paid -21,485 -24,574

Payments for settlement of derivatives -3,195 -3,033

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

-120,047 -81,976

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TOTAL NET CASH FLOW 13,796 -5,907

--------------------------------------------------------------------------------

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Cash and cash equivalents:

- at the beginning of period 65,311 72,012

- increase (+) / decrease (-) 13,796 -5,907

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- at the end of period 79,107 66,105

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Veiko Haavapuu

Finance Director

AS Tallink Grupp

Sadama 5/7. 10111 Tallinn

Tel +372 640 9914

E-mail [email protected]

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AS Tallink Grupp Unaudited Consolidated Interim Report Q3 2015

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