Tallink Grupp

Earnings Release • Mar 19, 2014

• Tallink is the leading European provider of leisure and business travel and sea transportation services in the Baltic Sea region
• Fleet of 18 vessels
• Operating five hotels
• Revenue EUR 942 million
• EUR 1.7 billion asset base
• Nearly ⁷⁰⁰⁰ employees
• Over 9 million passengers annually
• Over ³⁰⁰ thousand cargo units annually
• Listed on Nasdaq OMX Baltic TAL1T

Over 50 years of operating and cruising experience

Tallink's business model

Product offering

1-2 overnight cruises & passenger transportation

On-board Tax-Free Shopping

Hotel & travel packages

City break

Cargo Transportation

Revenue structure 2013

4

Tallink's position in the global ferry market

The World's top Duty free & Travel Retail Shops 2012

Ranking by actual and estimated retail sales in US\$ millions.

			1	Stena Line
	Rank Location	Remarks	2	Grimaldi Lines
	Sales> US\$ 1,000.0 million		3	Tallink
1	Seoul - Incheon Int'l Airport, South Korea	AIRPORT SHOPS	4	P&O Ferries
2	Dubai - Dubai International Airport, U.A.E.	AIRPORT SHOPS	5	Scandlines
3	London - Heathrow Airport, UK	AIRPORT SHOPS
4	Singapore - Changi Airport	AIRPORT SHOPS
	Sales> US\$ 900.0 million			Rank Company
5	Hong Kong - Hong Kong International Airport	AIRPORT SHOPS	1	Tallink
6	Bangkok - Suvarnabhumi Airport, Thailand	AIRPORT SHOPS	2	Stena Line
	Sales> US\$ 800.0 million		3	Viking Line
7	Shanghai – Pudong Airport, China P.R	AIRPORT SHOPS	4	Grimaldi
	Sales> US\$ 700.0 million		5	Tirrenia
8	Beijing – Capital Airport, China P.R.	AIRPORT SHOPS
9	Paris - Charles de Gaulle Airport, France	AIRPORT SHOPS
	10 Frankfurt – Frankfurt-Main Airport, Germany	AIRPORT SHOPS		Rank Company
	Sales> US\$ 600.0 million	AIRPORT SHOPS	1	DFDS Group
11	Tallink	FERRY SHOPS	2	Stena Line
12	Taipei - Taoyuan International Airport, Taiwan	AIRPORT SHOPS	3	Tallink
	Sales> US\$ 500.0 million		4	Finnlines
	13 Amsterdam - Schipol Airport, Netherlands	AIRPORT SHOPS	5	Scandlines
14	Sao Paulo - Guarulhos Int'l Airport, Brazil	AIRPORT SHOPS
15	Tokyo – Narita Airport	AIRPORT SHOPS

Source: Generation Research 2013

Data: Ro/pax / ferries above 1,000 GT Source: ShipPax MARKET:13

Rank Company

Strategic plan

Tallink's vision is to be the market pioneer in Europe by offering excellence in leisure and business travel and sea transportation services

Long term objectives toward increasing the company value and profitability:

• Strive for the highest level of customer satisfaction
• Increase volumes and strengthen the leading position on our home markets
• Develop a wide range of quality services directed at different customers and pursue new growth opportunities
• Manage the optimal debt level that will allow sustainable dividends

Current strategic cornerstones and competitive advantages:

Most modern	Wide route	Strong market share &	High safety level &
fleet	network	brand awareness	environmental standards

Tallink's passenger market share is 47% of the Northern Baltic Sea

We are targeting new customers from a wider country base More than 10% of our passengers come from outside of our home markets

Market shares Passenger operations

Turku - Stockholm

53% 53% 53% 54% 54% 54% 47% 47% 47% 46% 46% 46% 2008 2009 2010 2011 2012 2013 Helsinki - Stockholm

Riga - Stockholm

Highlights and milestones

Tallink's performance after the management buyout

Developments in 2013

New booking engine New website

Mobile platform

2013 developments – Riga-Stockholm route

New vessel Isabelle

• Replaced M/S Silja Festival on the Riga-Stockholm route from May 2013
• EUR 30 million investment
• Built 1989
• Length: 171m
• Passengers: 2480
• Lanemeters: 850
• Cars: 450
• ~40% more car capacity
• ~13% more cabins

The route increased 8.4% in revenue and 134.3% in annual result The 2013 twelve months result was positive

New visions

• Expansion of shop areas and modernizing restaurant areas to improve the performance through retail space
• Modern retail environment visual
• Wider selection of the products
• Developing on-board areas with the goal: approchable, comfortable and customer friendly
• Responding to higher expectations of the passengers

Helsinki – Stockholm retail space upgrade 2014

• Silja Serenade upgrade in spring, Silja Symphony will follow in autumn
• 50% expanded shopping areas including a new Superstore, upgraded Grand Buffet concept and a new Italian restaurant
• Overall investment in to the vessels public space upgrades on the Helsinki-Stockholm route in 2014 more than EUR 20 million

Results quarterly seasonality breakdown

Revenue (EUR millions) EBITDA (EUR millions)

The dynamics of high seasonality on the profit level Net result by quarters

Typical to the Tallink business model is that most of the result is made in the summer, the high season.

Unaudited Consolidated Income Statement

(in EUR million)	2012	2013	2012 Q4	2013 Q4
Sales	944	942	223	224
Cost of sales (1)	(743)	(751)	(183)	(187)
Marketing, general & admin (1)	(109)	(108)	(28)	(26)
EBITDA	166	156	32	30
Margin (%)	17.5%	16.6%	14.4%	13.3%
Net Profit	56	43	5.7	7.5
EPS	0.08	0.06	0.01	0.01

Notes:

(1) Includes depreciation and amortization

Unaudited costs breakdown

	2012	2013	Change %
Cost of goods	213 671	220 222	3%
Fuel cost	143 934	129 826	-10%
Staff costs	131 583	135 053	3%
Marketing & Administration (1)	101 865	100 316	-2%
Port & stevedoring	93 073	96 295	3%
Ship operating expenses	65 944	74 017	12%
Other costs	31 091	31 363	1%
Total costs from operations	781 161	787 092	1%
Depreciation and amortisation	70 996	73 175	3%
Net finance cost	40 980	35 956	-12%
Total costs	893 137	896 223	0%

1) Amortisation and depreciation excluded

Unaudited Consolidated Cash Flow Statement

(in EUR million)	2012	2013	2012 Q4	2013 Q4
Operating cash flow	163	168	44	48
Capital expenditure	(9)	(43)	(1)	(5)
Asset disposal	0	1	0	1
Free cash flow	154	126	43	44
Debt financing	(119)	(40)	(26)	(11)
Interests & other financial items	(45)	(38)	(10)	(11)
Dividend paid	0	(33)	0	0
Dividend tax	0	(9)	0	0
Change in cash	(10)	6	7	22

Unaudited Consolidated Statement of Financial Position

(in EUR million)	31.08.2010	31.08.2011	31.12.2012	31.12.2013
Total assets	1,871	1,800	1,742	1,722
Non-current assets	1,741	1,657	1,599	1,572
Current assets	130	143	143	150
- of which cash -	57	75	66	72
Total liabilities	1,203	1,094	981	951
Interest bearing liabilities	1,068	960	840	794
Other liabilities	135	134	141	157
Shareholders' equity	668	705	761	771
Net debt/EBITDA	7x	5.4x	4.7x	4.6x
Net debt	1,010	884	775	722
Equity/assets ratio	36%	39%	44%	45%
BVPS (1) (in EUR)	1.00	1.05	1.14	1.15

21

• Our ice-classed fleet is versatile to operate anywhere
• We have experience in selling and chartering vessels all over the world

Total EUR 794 million interest bearing liabilities outstanding as of 31.12.2013

Amount:	NOK 900M (EUR 120M)
Cost:	3M NIBOR + 5.00%
	(3M EURIBOR +4.88%)
Type:	Senior unsecured
Issue date:	18.06.2013
Maturity	date: 18.10.2018
Listing:	Oslo Børs
Currency	risk eliminated by swapping to EUR

100% EUR denominated bank loans

7 standalone loan agreements with bank syndicates

Maturities ~5-10 years

Amortizing project loans

6.64% of debt is fixed rate, rest in EURIBOR floating,1/3 hedged

Sulfur emission regulation in 2015 poses a challenge to the shipping industry – there is no single solution

Use low sulphur fuel (gasoil)	Add exhaust gas scrubbers	Convert ships to LNG
Low investment cost	Current cost of a scrubber is estimated at EUR 2-15m per vessel depending on vessel type	High investment cost
Cost of fuel is higher	Scrubbers will allow cheaper heavy fuel oil	Similar cost of fuel
Has no schedule disruption	Scrubber fitting brings limited schedule disruption	Requires major conversion and a long schedule disruption
Requires no changes in bunkering infrastructure	Additional waste processing needed	Infrastructure currently limited

Unrivalled suite of competitive advantages

Extensive Sales Network

• 21 own sales offices

7

• Network of >1,800 travel agents and tour operators worldwide

5

• Growing online presence and call centres

Modern fleet

• 11 core vessels have an average age of 12.5 years
• Ice class vessels

1

• Luxurious on-board experience, e.g. spacious shopping areas

Extensive route network

• Variety of short cruises between key cities
• Optimised schedules with frequent and reliable departures all year
• Established relationships with port authorities

1

3

Strong quality brands

• Silja Line and Tallink are the most recognised cruise brands in the Northern Baltic Sea Region
• They are associated with a quality customer experience Finland Estonia Sweden

1 1

Comprehensive offer

• Varied on-board experience
• Travel packages and excursions
• Addressing all budget ranges and customer preferences

47% Market share of the Northern Baltic Sea Region passenger market

4

Loyal customer base

• 9m passengers in 2013
• 1.6 million Club One card holders growing at 9% in 2013
• Every third passenger is a club one member.

High safety and environmental standards

2

• We proactively seek compliance with the highest standards
• In 2013, only 12 of the over 9000 scheduled trips were cancelled for technical reasons

6

Tallink's Fleet

Baltic Queen Built: 2009 Length: 212m Passengers: 2800 Lane meters: 1130

Baltic Princess Built: 2008 Length: 212m Passengers: 2800 Lane meters: 1130

Victoria I Built: 2004 Length: 193m Passengers: 2500

Galaxy Built: 2006 Length: 212m Passengers: 2800 Lane meters: 1130

Silja Europa Built: 1993 Length: 202m Passengers: 3123 Lane meters: 932

Silja Serenade Silja Symphony Built: 1990/91 Length 203m Passengers: 2852 Lane meters: 950

Tallink has invested 1.3 billion EUR to create a modern fleet

Tallink's Fleet

Superstar Built: 2008 Length 177m Passengers: 2080 Lane meters: 1930

Romantika Built: 2002 Length 193m Passengers: 2500 Lane meters: 1030

Star Built: 2007 Length 186m Passengers: 1900 Lane meters: 2000

Isabelle Built: 1989 Length 171m Passengers: 2480 Lane meters: 850

Superfast VII/VIII/IX Built: 2001/2002 Length: 203m Passengers: 717

Silja Festival Built: 1986 Length 171m Passengers: 2023 Lane meters: 885

In addition the Group has 2 ro-pax cargo vessels in operation and 1 older ferry which has been replaced and is outside of the core operations

Ownership structure

Shareholders of AS Tallink Grupp

Top 10 shareholders Institutional investors Retail investors

Ten largest shareholders on 31.08.2010 Ten largest shareholders in the end of Q4

Infortar	36%
Baltic Cruises Holding, L.P.	17%
Nordea Bank Finland PLC / non-resident legal entities	9%
ING Luxemburg S.A	7%
State Street Bank and Trust Omnibus fund	2%
Skandinaviska Enskilda Banken AB Clients (East Capital)	2%
JP Morgan Chase Bank / London Client's account	1%
Firebird Republics Fund Ltd Mellon Treaty Omnibus	1%
BNYM / ING BANK SLASKI AC LM AKCJI FIO Firebird Republics Fund Ltd	1%
Firebird Avrora Fund, Ltd Mellon Treaty Omnibus	1%

Safety, security and environmental protection are a high priority

• Safety and Security Policy
• Environmental Policy
• ISO 14001:2004 Environmental Certificate by Lloyds Register
• MARPOL Sewage Pollution Prevention Certificate
• MARPOL Air Pollution Prevention Certificate
• International Anti-Fouling System Certificate
• MARPOL Oil Pollution Prevention Certificate
• Document of Compliance for Anti-Fouling System
• MARPOL Garbage Pollution Prevention Attestation
• Passenger Ship Safety Certificate
• International Ship Security Certificate
• Safety Management Certificate
• Document for Dangerous Goods

	ness Assurance
	CERTIFICATE OF APPROVAL
This is to certify that the Environmental Management System of:
	HT Shipmanagement Ltd Tallinn, Riga Estonia, Latvia
to the following Environmental Management System Standard:	has been approved by Lloyd's Register Quality Assurance
	ISO 14001: 2004
	The Environmental Management System is applicable to:
	TallinkSilja Fleet Shipmanagement.
This certificate is valid only in association with the certificate schedule bearing the same	number on which the locations applicable to this approval are listed.
Approval Certificate No: LTQ6004314	Original Approval: 04 July 2008
	Current Certificate: 04 July 2011
	Certificate Expiry:	03 July 2014
	Issued by: Lloyd's Register PMEA Eesti filiaal for and on behalf of the Lloyd's Register Quality Assurance Limited
	This document is subject to the provision on the reverse T1 Fenchurch Street, London: EC3M 48S United Kingdom. Registration number 1879370 This approximation in the MQA appoint and the DQA 48S United Kingdom Registration number 1879370 The unity Accordination Municipality and th	ditation Certificate Number 001