Tallink Grupp

AS Tallink Grupp Unaudited Consolidated Interim Report Q2 2015

Tallinn, 2015-08-13 08:50 CEST (GLOBE NEWSWIRE) --

AS Tallink Grupp Unaudited Consolidated Interim Report Q2 2015

In the second quarter (1 April ? 30 June) of the 2015 financial year AS Tallink

Grupp and its subsidiaries? (the Group) carried nearly 2.4 million passengers

which is on the same level compared to the second quarter last year. The

Group?s unaudited revenue for the second quarter of 2015 increased by EUR 7.4

million or 3.0% year on year to the total of EUR 253.9 million, EBITDA

increased by EUR 14.1 million or 34.3% to the total of EUR 55.2 million,

compared to the same period last year. Net profit increased by EUR 22.4 million

or 367.7% to the total of EUR 28.5 million, compared to the same period last

year.

The Group?s revenue for the first six months of 2015 was EUR 444.0 million and

increased by EUR 9.3 million or 2.1% year on year comparison. EBITDA increased

by EUR 29.1 million to the total of EUR 74.6 million and net profit increased

by EUR 32.5 million to the total of EUR 15.2 million, compared to the same

period last year.

The Group made various changes to the operations during the past year, these

changes have continued to positively affect the operating result in the second

quarter with increased revenue and profitability.

In the second quarter the Estonia-Finland route revenue increased by 6.2%,

driven by 4.8% growth in passenger number and 19.9% increase in cargo units,

the cargo growth is supported mainly by added capacity. The Estonia-Sweden

route, where capacity is lower than last year, experienced a 5.1% decrease in

passengers and a 12.3% decrease in cargo volumes. The Latvia-Sweden route,

operating with one vessel compared to two vessels last year, showed a decline

with passenger numbers decreasing by 42.3%, cargo units transported decreased

by 59.2%.

Throughout the second quarter price pressure from competition remained visible

on all routes. The group was able to keep the total number of passengers on

same level despite the total lower capacity from Latvia-Sweden route. The

passenger number was supported by growth in Estonia-Finland and Finland-Sweden

routes.

The upgrades of the public areas and improvements to restaurant and shop

concept throughout the fleet in past year, combined with the operational

changes, have resulted in a 2.0% increase in on-board revenue per passenger.

Due to the increased number of chartered vessels compared to the same period

last year the revenue from charters increased by EUR 4.8 million or 57.8% to

the total of EUR 13.2 million. Main contribution to the charter revenue growth

comes from the Silja Europa charter agreement from August 2014 onwards.

In February 2015 AS Tallink Grupp and Meyer Turku Oy signed a contract for the

construction of the new LNG powered fast ferry for Tallinn-Helsinki route

shuttle operations. The ship will cost around EUR 230 million, 20% of the total

cost will be paid during the construction period and the rest 80% upon the

delivery of the vessel in the beginning of 2017. AS Tallink Grupp's subsidiary

Tallink Line Ltd. and Nordea Bank Finland Plc have signed the loan agreement in

June 2015 in amount of EUR 184 million with maturity of twelve years from

drawdown to finance the construction of the new fast ferry in Meyer Turku

shipyard. Finnish Export Credit Agency ?Finnvera? guarantees 95% of this

post-delivery buyer credit and the loan bears OECD Commercial Interest

Reference Rate (CIRR) based fixed interest rate.

Two of the vessels that were chartered out, Silja Festival and Regina Baltica

were sold in the second quarter of the 2015 financial year. The sale of the two

vessels generated a positive cash flow of EUR 25 million which was used for the

EUR 11.5 million down payment of the new LNG vessel and repayment of loans.

Altogether the Group successfully continued the deleveraging strategy and the

net debt decreased by EUR 62 million to a total of EUR 614 million in the

second quarter resulting in a solid net debt to EBITDA ratio of 3.4.

In the first half year of 2015 the positive effect from chartering activities

has been clearly visible as in the comparable period last year fewer ships were

in charter. Looking forward to the second half of the 2015 financial year the

chartering revenues will decrease compared to the previous year as Silja Europa

charter becomes comparable with the last year and two ships previously in

charter were sold in the second quarter of 2015.

In June 2015 AS Tallink Grupp agreed with the main fuel supplier to fix the

price of approximately 30% of the fuel purchasing volume until the end of 2015.

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

amounted to EUR 62.4 million and EBITDA to EUR 55.2 million being respectively

EUR 11.4 million and EUR 14.1 million more compared to the same period last

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

passenger numbers, increased charter revenues and decreased costs related to

operations. The increase in the pre-tax profit was affected by higher financial

income mainly due to the increase in the fair value of derivative instruments

(interest rate swaps) which resulted in EUR 7.3 million lower net finance cost.

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

EUR 28.5 million or EUR 0.04 per share compared to the net profit of EUR 6.1

million or EUR 0.01 per share in the same period last year.

In June 2015 the shareholders annual general meeting decided to pay a dividend

of 0.02 euros per share. The total dividend amount of EUR 13.4 million was paid

out in the beginning of July 2015 (third quarter).

Cash flow from operations increased by EUR 8.2 million when compared to the

same period last year. The total liquidity, cash and unused credit facilities

at the end of the second quarter was EUR 96.2 million providing a strong

position for sustainable operations. At the end of the second quarter 2015 the

Group had EUR 81.0 million in cash and equivalents and the total of unused

credit lines were at EUR 15.2 million.

Q2 KEY FIGURES 2015 2014 Change

Apr-Jun Apr-Jun

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

Revenue EUR million 253.9 246.5 3.0%

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Gross profit EUR million 62.4 51.0 22.4%

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Gross margin 24.6% 20.7%

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EBITDA EUR million 55.2 41.1 34.3%

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

EBITDA margin 21.7% 16.7%

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Net profit for the EUR million 28.5 6.1 367.7%

period

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

Net profit margin 11.2% 2.5%

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

Depreciation and EUR million 19.9 20.0 -0.4%

amortization

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

Investments EUR million 14.9 6.2 139.0%

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

Weighted average number of ordinary shares 669 882 040 669 882 040

outstanding

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

Earnings per share EUR 0.04 0.01 367.7%

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Number of passengers 2 356 039 2 363 510 -0.3%

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

Number of cargo units 78 659 79 055 -0.5%

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

Average number of 6 903 7 124 -3.1%

employees

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

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

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

30.06.2015 31.03.2015

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Total assets EUR million 1 665.5 1 674.5 -0.5%

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

Interest-bearing EUR million 695.5 742.9 -6.4%

liabilities

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

Net debt EUR million 614.5 676.6 -9.2%

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

Total equity EUR million 780.2 764.9 2.0%

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

Equity ratio 46.8% 45.7%

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

Net debt to EBITDA 3.4 4.1

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

Number of ordinary 669 882 040 669 882 040 0%

shares outstanding1

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

Shareholders? equity per EUR 1.16 1.14 2.0%

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

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 01.04.2015- 01.04.2014- 01.01.2015- 01.01.2014-

euros)

30.06.2015 30.06.2014 30.06.2015 30.06.2014

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

Revenue 253,862 246,463 444,015 434,669

Cost of sales -191,489 -195,503 -355,538 -371,922

Gross profit 62,373 50,960 88,477 62,747

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

Marketing expenses -16,481 -16,001 -31,716 -31,799

Administrative expenses -11,603 -13,888 -23,318 -25,277

Other income 1,362 312 1,485 525

Other expenses -390 -292 -581 -340

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

Result from operating 35,261 21,091 34,347 5,856

activities

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

Finance income 1,621 551 7,297 3,867

Finance costs -4,000 -10,192 -20,608 -21,637

Profit/-loss before income 32,882 11,450 21,036 -11,914

tax

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

Income tax -4,350 -5,349 -5,850 -5,359

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

Net profit/-loss for the 28,532 6,101 15,186 -17,273

period

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

Other comprehensive

income/-expense

Items that may be

reclassified to profit or

loss

Exchange differences on 28 -51 -54 8

translating foreign

operations

Other comprehensive 28 -51 -54 8

income/-expense for the

period

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

Total comprehensive 28,560 6,050 15,132 -17,265

income/-expense for the

period

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

Earnings per share (in EUR

per share)

- basic 0.043 0.009 0.023 0.026

- diluted 0.043 0.009 0.023 0.026

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

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(unaudited, in thousands of euros)

ASSETS 30.06.2015 31.12.2014

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

Current assets

Cash and cash equivalents 81,048 65,311

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

Trade and other receivables 44,028 38,210

Prepayments 10,670 5,448

Inventories 30,424 31,315

Total current assets 166,170 140,284

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

Non-current assets

Investments in equity-accounted investees 286 286

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

Other financial assets 332 252

Deferred income tax assets 21,349 21,338

Investment property 300 300

Property, plant and equipment 1,423,409 1,467,964

Intangible assets 53,608 55,174

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

Total non-current assets 1,499,284 1,545,314

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

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

TOTAL ASSETS 1,665,454 1,685,598

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

LIABILITIES AND EQUITY

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

Current liabilities

Interest bearing loans and borrowings 145,730 149,850

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

Trade and other payables 95,415 91,236

Dividends 13,398 0

Income tax liability 6,344 1,300

Deferred income 39,891 29,408

Derivatives 34,694 41,982

Total current liabilities 335,472 313,776

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

Non-current liabilities

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

Interest bearing loans and borrowings 549,806 593,532

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

Total non-current liabilities 549,806 593,532

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

TOTAL LIABILITIES 885,278 907,308

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

EQUITY

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

Equity attributable to equity holders of the parent

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

Share capital 404,290 404,290

Share premium 639 639

Reserves 71,590 70,129

Retained earnings 303,657 303,232

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

Total equity attributable to equity holders of the 780,176 778,290

parent

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

TOTAL EQUITY 780,176 778,290

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

TOTAL LIABILITIES AND EQUITY 1,665,454 1,685,598

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

CONSOLIDATED CASH FLOW STATEMENT

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

30.06.2015 30.06.2014

Cash flows from operating activities

Net profit/-loss for the period 15,186 -17,273

Adjustments 59,282 64,136

Changes in receivables and prepayments related to -10,917 -12,844

operating activities

Changes in inventories 891 1,268

Changes in liabilities related to operating activities 14,097 15,615

Income tax paid -246 -4

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

78,293 50,898

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

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Cash flow used in investing activities

Purchase of property, plant and equipment and -18,499 -20,351

intangible assets

Proceeds from disposals of property, plant and 25,001 114

equipment

Interest received 41 9

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

6,543 -20,228

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

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

Cash flow used in financing activities

Repayment of loans -49,381 -39,920

Change in overdraft -2,644 26,589

Payment of finance lease liabilities -40 -97

Interest paid -14,744 -17,040

Payments for settlement of derivatives -2,290 -2,000

-69,099 -32,468

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TOTAL NET CASH FLOW 15,737 -1,798

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

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

Cash and cash equivalents:

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

- increase (+) / decrease (-) 15,737 -1,798

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

- at the end of period 81,048 70,214

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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 Q2 2015

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