Tallink Grupp

AS Tallink Grupp Unaudited Consolidated Interim Report Q4 2015

Tallinn, 2016-02-29 08:50 CET (GLOBE NEWSWIRE) --

AS Tallink Grupp Unaudited Consolidated Interim Report Q4 2015

AS Tallink Grupp and its subsidiaries (the Group) carried a total of 9.0

million passengers in the 2015 financial year which is 1.1% more compared to

the year before. The Group?s unaudited revenue increased by 2.6% to all-time

high of EUR 945.2 million and EBITDA increased by 20.5% to a record EUR 181.4

million. Unaudited net profit more than doubled compared to last year and

amounted to EUR 59.1 million or EUR 0.09 per share. The cash flow from

operating activities increased by EUR 41.2 million and totaled to EUR 191.9

million.

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

passenger number, higher on-board revenue per passenger, higher charter revenue

and lower operating costs. The passenger number grew steadily in most routes

and the Group regained market share from the direct competition.

The revenue growth is driven by higher restaurant & shop sales and charter

revenues. The restaurant & shop sales increase 2.7% or EUR 13.1 million was

supported by higher passenger number and also higher on-board sales per

passenger. The charter revenues increased by 13.6% or EUR 6.4 million and the

cargo revenues by 1.3% compared to 2014. Proactive marketing and sales

activities led to an increase of passenger number and resulted in lower ticket

revenue per passenger, the total ticket revenue declined by 1.1%.

Estonia-Finland route passenger number increased by 5.0% and cargo units by

17.9%, the segment revenue increased by 5.1%. The Finland-Sweden route

passenger number grew by 4.1% mostly due to more departures compared to 2014,

the cargo units transported decreased by 26.2% and segment revenue increased by

2.9%. The shift of cargo volumes between the routes is the result of one cargo

vessel moved from Finland-Sweden route to Estonia-Finland route from 2015. The

Latvia-Sweden route passenger and cargo volume decreased by 32.2% and by 46.5%

respectively as only one vessel was operating on the route since mid-2014.

The lower energy prices globally enabled smooth adoption to the more

environmental friendly low sulphur fuel and the previously highlighted risk of

increasing fuel cost did not materialise. Following the market prices the

Group?s average fuel price in 2015 was 5% lower compared to 2014. The total

annual fuel consumption reduced by 13%, the saving is attributed to

optimisations in vessel operations and changes in the fleet. Lower total fuel

consumption and price resulted in approximately EUR 20 million less fuel cost

compared to 2014.

In the fourth quarter (1 October - 31 December) of the 2015 financial year the

Group carried 2.1 million passengers which is 3.6% more compared to the fourth

quarter last year and unaudited revenue increased 1.6% to the total of EUR

227.6 million.

The Group?s fourth quarter profitability is affected by EUR 9.5 million one-off

costs (book loss and transaction costs) related to sale of fast ferry

Superstar. The fourth quarter EBITDA decreased by EUR 11.1 million to EUR 29.9

million compared to the same period last year, the adjusted EBITDA from normal

operations, excluding the one off costs is EUR 39.4 million.

The Estonia-Finland route fourth quarter revenue increased 5.3% compared to

same period last year. The increase is driven mainly by a 6.3% growth in the

passenger number. The growth of 15.4% in cargo units transported is supported

mainly by added capacity.

The Finland-Sweden routes fourth quarter revenue was on level with last year,

although the passenger number grew by 2.2%. The number of cargo units

transported decreased by 27.7% due to reduced capacity.

The Estonia-Sweden route revenue increase of 11.7% was driven by a 2.0%

increase of passenger number and higher on board sales per passenger, cargo

volume was on level with last year. The Latvia-Sweden route showed an 11.4%

decline in the passenger number, cargo volume was on level with last year.

The Group?s restaurants and shop sales increased by EUR 6.3 million or 5.3% in

the fourth quarter compared to the same period last year. The sales growth is

driven by the growth of the passenger number and higher average on-board

revenue per passenger.

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

compared to the same period last year due to fewer ships were chartered out.

Two ships previously chartered out were sold in the second quarter of 2015.

AS Tallink Grupp signed a contract with Meyer Turku Oy in February 2015 for the

construction of its new EUR 230 million LNG powered fast ferry. The start of

production of the new LNG fast ferry started on the 4th of August 2015 at Meyer

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

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

the Tallinn-Helsinki route Shuttle service early 2017, the Group decided to

sell and charter back the fast ferry Superstar. The ownership of the vessel was

transferred to the buyer on 1st of December 2015. The Group continues to

operate the vessel under the charter agreement until the beginning of 2017,

when the new LNG fast ferry will start to operate on Tallinn-Helsinki route

Shuttle service.

In financial year 2015 the Group sold three vessels. The total cash proceeds

from the sale EUR 115.4 million are mainly used to repay loans and for the down

payment of the new LNG fast ferry under construction.

In the fourth quarter the Group?s net debt decreased by EUR 116.3 million to a

total of EUR 467.4 million and the net debt to EBITDA ratio improved further to

a solid 2.6 at the end of fourth quarter.

The Group?s fourth quarter total finance costs decreased by EUR 3.4 million due

to lower cost from foreign exchange revaluations. The interest cost increased

compared to last year, including one-off cost of premature termination of loan

contract related to the sale of vessel.

The unaudited net loss for the fourth quarter of the 2015 financial year was

EUR 1.3 million or EUR -0.002 per share compared to the net profit of EUR 8.4

million or EUR 0.013 per share in the same period last year. The Group?s net

profit for the 2015 financial year was EUR 59.1 million or EUR 0.09 per share

compared to the EUR 27.3 million or EUR 0.04 per share in the same period last

year.

Cash flow from operations increased by EUR 9.3 million in fourth quarter

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

credit facilities, at the end of the fourth quarter was EUR 153.6 million

providing a strong financial position. The Group had EUR 82.0 million in cash

and equivalents and the total of unused credit lines were at EUR 71.6 million.

Q4 KEY FIGURES

2015 2014 Change

Oct-Dec Oct-Dec

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Revenue EUR million 227.6 224.1 1.6%

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Gross profit EUR million 50.2 49.4 1.7%

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Gross margin 22.0% 22.0%

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EBITDA EUR million 29.9 41.0 -27.1%

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EBITDA adjusted 1 EUR million 39.4 41.0 -3.9%

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EBITDA margin 17.3% 18.3%

adjusted 1

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Net profit for the EUR million -1.3 8.4 -115.8%

period

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Net profit for the EUR million 13.7 8.4 63.1%

period adjusted 1

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

Net profit margin 6.0% 3.7%

adjusted 1

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

Depreciation and EUR million 19.4 20.9 -7.1%

amortization

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Investments EUR million 13.8 18.1 -23.8%

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

outstanding 2

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Earnings per share EUR 0.00 0.01 -115.8%

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Number of 2,125,361 2,051,410 3,6%

passengers

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Number of cargo 78,136 77,816 0.4%

units

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Average number of 6,769 6,715 0.8%

employees

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

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

31.12.2015 30.09.2015

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Total assets EUR million 1,538.1 1,652.6 -6.9%

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

Interest-bearing EUR million 549.3 662.7 -17.1%

liabilities

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

Net debt EUR million 467.4 583.6 -19.9%

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

Total equity EUR million 824.5 825.3 -0.1%

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

Equity ratio 53.6% 49.9%

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

Net debt to EBITDA 2.6 3.0

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Number of ordinary shares outstanding 2 669,882,040 669,882,040 0.0%

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

Shareholders? EUR 1.23 1.23 -0.1%

equity per share

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

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 Vessel sale result in the fourth quarter of 2015 is eliminated.

2 Share numbers exclude own shares.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(unaudited, in thousands of 01.10.2015- 01.10.2014- 01.01.2015- 01.01.2014-

euros)

31.12.2015 31.12.2014 31.12.2015 31.12.2014

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

Revenue (Note 3) 227,631 224,141 945,203 921,466

Cost of sales -177,439 -174,782 -721,780 -739,789

Gross profit 50,192 49,359 223,423 181,677

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Marketing expenses -16,777 -15,771 -63,578 -62,654

Administrative expenses -13,001 -13,638 -47,311 -49,211

Other income -377 709 983 1,696

Other expenses -9,517 -496 -10,254 -854

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Result from operating 10,520 20,163 103,263 70,654

activities

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Finance income (Note 4) 3,301 4,623 12,808 11,760

Finance costs (Note 4) -14,317 -19,059 -46,964 -52,443

Share of profit of 64 24 64 24

equity-accounted investees

Profit/-loss before income -432 5,751 69,171 29,995

tax

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

Income tax -896 2,633 -10,101 -2,734

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

Net profit/-loss for the -1,328 8,384 59,070 27,261

period

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

Other comprehensive

income/-expense

Items that may be

reclassified to profit or

loss

Exchange differences on 416 242 160 286

translating foreign

operations

Other comprehensive 416 242 160 286

income/-expense for the

period

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

Total comprehensive -912 8,626 59,230 27,547

income/-expense for the

period

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

Earnings per share (in EUR

per share)

- basic (Note 5) -0.00 0.01 0.09 0.04

- diluted (Note 5) -0.00 0.01 0.09 0.04

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

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(unaudited, in thousands of euros)

ASSETS 31.12.2015 31.12.2014

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

Current assets

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

Cash and cash equivalents 81,976 65,311

Trade and other receivables 36,583 38,210

Prepayments 6,498 5,448

Inventories 29,197 31,315

Total current assets 154,254 140,284

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Non-current assets

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

Investments in equity-accounted investees 350 286

Other financial assets 308 252

Deferred income tax assets 19,410 21,338

Investment property 300 300

Property, plant and equipment (Note 7) 1,311,418 1,467,964

Intangible assets (Note 8) 52,726 55,174

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Total non-current assets 1,384,512 1,545,314

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

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

TOTAL ASSETS 1,538,766 1,685,598

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LIABILITIES AND EQUITY

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

Current liabilities

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

Interest bearing loans and borrowings (Note 9) 81,889 149,850

Trade and other payables 88,480 91,236

Income tax liability 4,567 1,300

Deferred income 28,906 29,408

Derivatives (Note 6) 42,863 41,982

Total current liabilities 246,705 313,776

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Non-current liabilities

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

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

Interest bearing loans and borrowings (Note 9) 467,447 593,532

Other payables 192 0

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

Total non-current liabilities 467,639 593,532

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

TOTAL LIABILITIES 714,344 907,308

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

EQUITY

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

Equity attributable to equity holders of the parent

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

Share capital 404,290 404,290

Share premium 639 639

Reserves 65,083 70,129

Retained earnings 354,410 303,232

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

Total equity attributable to equity holders of the 824,422 778,290

parent

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

TOTAL EQUITY 824,422 778,290

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

TOTAL LIABILITIES AND EQUITY 1,538,766 1,685,598

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CONSOLIDATED CASH FLOW STATEMENT

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

31.12.2015 31.12.2014

Cash flows from operating activities

Net profit/-loss for the period 59,070 27,261

Adjustments 132,851 125,629

Changes in receivables and prepayments related to 1,463 -2,291

operating activities

Changes in inventories 2,118 2,142

Changes in liabilities related to operating activities -4,139 -2,103

Income tax paid 553 71

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191,916 150,709

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Cash flow used in investing activities

Purchase of property, plant and equipment and -43,629 -49,148

intangible assets (Notes 7, 8, 9)

Proceeds from disposals of property, plant and 115,370 215

equipment

Proceeds from other financial assets 229 0

Interest received 74 140

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72,044 -48,793

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Cash flow used in financing activities

Repayment of loans (Note 9) -133,263 -89,842

Change in overdraft (Note 9) -59,052 43,993

Payment of finance lease liabilities (Note 9) -80 -75

Interest paid -33,210 -33,270

Payments for settlement of derivatives -4,045 -3,985

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

-247,295 -108,617

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TOTAL NET CASH FLOW 16,665 -6,701

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Cash and cash equivalents:

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

- increase (+) / decrease (-) 16,665 -6,701

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- at the end of period 81,976 65,311

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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 Q4 2015

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