Havila Kystruten AS

Earnings Release • Feb 27, 2025

Havila Kystruten AS: Fourth quarter 2024 accounts

Havila Kystruten AS: Fourth quarter 2024 accounts

Summary

Following several challenging years marked by external factors impacting both

the delivery and financing of its new, environmentally friendly coastal cruise

ships, 2024 represents the first full year of operation for all four of Havila

Kystruten AS's vessels along the Norwegian coast. In its first year of full

operation, the fleet achieved excellent operational uptime, reaching 100% in the

fourth quarter and 98% for the year. This reflects a well-prepared crew, an

efficient onshore organization, and positive collaboration with customers and

partners along the coast. Collectively, these elements form the foundation for

the company's value creation for shareholders, travellers, and the communities

it serves.

Fourth-quarter revenue totalled NOK 403 million, a substantial increase from NOK

249 million in the same period of 2023.

Total 2024 revenue reached NOK 1,529 million, up from NOK 764 million the

previous year. Fourth-quarter EBITDA reached NOK 50 million, a significant

improvement from negative NOK 33 million in Q4 2023. For the full year, EBITDA

was NOK 219 million, significally up from NOK negative 180 million in 2023.

These financial results reflect the company's ongoing start-up phase. Key

performance indicators (KPIs) demonstrated steady improvement throughout the

year, adjusted for seasonal variations. Occupancy rose to 78% in the fourth

quarter of 2024, compared to 63% in the same period of 2023, with a full-year

average of 73%, up from 65% the previous year.

Average cabin revenue (ACR) showed solid growth, reflecting the completion of

previously low-price bookings from 2023 and earlier, and the company's ability

to increase underlying price levels. Average cabin revenue increased from NOK

2,650 to NOK 3,800 in the quarter, and from NOK 3,300 to NOK 4,300 for the full

year.

Onboard sales per guest night continued to grow. The full-year average was NOK

710, a marked improvement from NOK 670 in 2023. Fourth-quarter 2024 was somewhat

impacted by adverse weather conditions, with average sales per guest night at

NOK 640, compared to NOK 650 in Q4 2023. Cabin factor (passengers per cabin)

also increased, reaching 1.85 in the fourth quarter compared to 1.75 the

previous year, and 1.82 for the full year versus 1.74 in 2023.

Fourth-quarter operating expenses were NOK 352 million, up from NOK 283 million

in the same period of the prior year. Total 2024 operating expenses were NOK

1,310 million, compared to NOK 944 million in 2023. Operating expenses primarily

consist of fixed costs. The delivery of the final two vessels in Q3 2023 have

impacted cost levels, while higher occupancy, increased onboard activity, and

annual wage adjustments contributed to the overall cost increase. Variable costs

are mainly related to fuel (LNG). Currently, the company does not hedge LNG

prices but has a built-in annual adjustment mechanism within its contract with

the government.

Currency fluctuations, particularly between the Norwegian krone and the euro,

impact both results and the balance sheet, resulting in unrealized currency

losses for the quarter and the year, negatively affecting equity. Adjusted for

vessel values, including broker valuations and estimated newbuild costs of just

under EUR 700 million, the company's adjusted equity remains significantly

positive estimated at NOK 3,751 million.

Fourth-quarter CO2 emissions were reduced by 33% compared to Kystruten's 2017

reference figures, exceeding the concession requirements, which stipulate a 25%

reduction. Utilizing LNG as fuel eliminates particulate emissions. The company

maintained its target of reducing food waste to below 75 grams per guest day,

with a fourth-quarter result of 70 grams.

Future Development

Demand for travel to Norway is growing, and Havila Kystruten's modern and

environmentally friendly ships have gained wide recognition and won several

international awards. The company's sustainable profile strengthens its growth

potential, with opportunities for both further price increases and higher

occupancy. Havila Kystruten is actively working towards achieving climate-

neutral operation by 2028 and is exploring opportunities to profitably integrate

biogas as fuel in the coming years.

The company aims to increase revenue through its digital sales platforms and

direct bookings, which have historically yielded higher prices closer to

departure. This strategy balances price and occupancy throughout the year to

maximize margins.

As of February 2025, 53% of capacity is already booked for the year, and the

target for 2025 is an occupancy rate exceeding 75%. Bookings between northbound

and southbound routes are currently more balanced than in 2024, enabling more

efficient operational planning and optimization of the high season, where the

northbound route is particularly popular.

Average cabin revenue is expected to increase by 20-30% in 2025, driven by price

adjustments and the phasing out of previous low-price bookings. The price

adjustments are possible due to the low starting point, where it was crucial to

build occupancy during the start-up phase. In addition, we see an increased

willingness to pay for travel with ships that deliver on sustainable operations,

with reduced emissions, onboard quietness, a unique and award-winning food

concept, spacious cabins, and the generally ample space onboard in the common

areas.

Havila Voyages offer of shorter trips, often combined with activities before and

after boarding, attracts a younger clientele. The average age of travellers in

2024 was 54 years, significantly lower than the historical average for the

coastal route. This focus on shorter trips opens up new commercial

opportunities, as travellers in this group have a higher willingness to pay. The

younger customer group also has higher demands for onboard activities, giving

the company opportunities to implement measures to increase onboard sales.

Through targeted pricing strategies and product improvements, the company will

increase revenue from onboard services and experiences.

Employees

Havila Kystruten had a total of 542 permanent employees as of December

31, 2024, of which 488 were seafarers and 54 in administration.

Contacts:

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

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