Tallink Grupp

Earnings Release • Jul 29, 2021

TALLINK GRUPP AS RESULTS WEBINAR

PRESENTERS

PAAVO NÕGENE CHAIRMAN OF THE MANAGEMENT BOARD

HARRI HANSCHMIDT MEMBER OF THE MANAGEMENT BOARD

JOONAS JOOST FINANCIAL DIRECTOR

TALLINK GRUPP

The leading European provider of leisure and business travel and sea transportation services in the Baltic Sea region.

OPERATIONS

• Fleet of 15 vessels
• Seven ferry routes (3 suspended)
• Operating four hotels (1 closed)

KEY FACTS

• Revenue of EUR 443 million in 2020
• Served 3.7 million passengers in 2020
• Transported 360 thousand cargo units
• Operating EUR 1.5 billion asset base
• 4 352 employees (end of Q2 2021)
• 2.8 million loyalty program members

STRONG BRANDS

STATUS OF EMPLOYMENT OF VESSELS IN 2021 YTD

	Continuous employment in 2021
Megastar	Tallinn-Helsinki

Star	Tallinn-Helsinki
Galaxy	Turku-Stockholm
Baltic Princess	Turku-Stockholm
SeaWind	Muuga-Vuosaari
Regal Star	Paldiski-Kapellskär
Sailor	Paldiski-Kapellskär
Atlantic Vision	Long-term charter

Status of vessels not employed in the first months of the year
Silja Europa	Short-term charter in June; Tallinn-Helsinki from 23 June
Silja Serenade	Tallinn-Helsinki in June; Helsinki-Mariehamn from 24 June
Silja Symphony	Sweden domestic cruises in July and August
Baltic Queen	Tallinn-Stockholm from 7 July
Victoria I	Short-term charter in July-September
Romantika	Short-term charter in July-September

4

Isabelle Inactive

2021 Q2 DEVELOPMENTS AND KEY FACTS

OPERATING ENVIRONMENT

• Extensive impact of COVID-19 and suspension of cruise ferries operations continued
• Restrictions imposed by the governments

ACTIVITIES AND EVENTS

• Continuous cost control to ensure efficiency and savings from previously implemented measures
• Appointment of the new Management Board member Margus Schults
• Changes in loan agreements
• Short-term charter agreements for Silja Europa, Victoria I and Romantika
• Opening of third Burger King restaurant in Latvia
• Completion of renovation and reopening of Tallink City Hotel on 30 June 2021

Silja Europa at the port of Falmouth

Q2 2021 OVERVIEW – COVID-19 & TRAVEL RESTRICTIONS

Q2 Selected Key Figures (financials in million euros)	2021	2020	Change
Number of passengers	427 767	388 212	10.2%
Number of cargo units	91 990	86 755	6.0%
Number of passenger cars	125 713	102 479	22.7%
Revenue Gross profit / loss EBITDA EBIT Net result for the period	86.1 -8.7 4.4 -19.4 -24.3	65.0 -21.9 2.4 -22.7 -27.4	32.5% 60.2% 80.4% 14.7% 11.1%
Capital expenditures	3.1	14.4	-78.2%
As at:	30.06.21	31.03.21	Change
Total assets	1 524.7	1 492.5	2.2%
Total equity	655.7	680.1	-3.6%
Interest-bearing liabilities	744.5	728.3	2.2%
Net debt	706.7	713.5	-1.0%
2021 unaudited

TALLINK GRUPP

• Revenue EUR 86.1m (EUR +21.1m or 32.5% vs LY)

• Extensive impact from COVID-19 related travel restrictions
• More limited impact on cargo operations
• 18% more departures compared to Q2 2020

• Costs & support

• Cost of sales increased by 9% or EUR 7.9m
• Costs relating to re-employment of vessels in Q2 2021
• Administrative & marketing cost increased by 3% or EUR 0.4m
• Reduced remuneration in Q2 2020
• Total impact of various support measures: EUR 10.6m in Q2 2021 (EUR -17.1m vs LY)
• EBITDA of EUR 4.4m (EUR +1.9m vs LY)
• Net loss of EUR 24.3m (EUR +3.0m vs LY)

RESULTS QUARTERLY SEASONALITY BREAKDOWN

1.9 1.9 1.6 2.6 2.7 0.4 0.4 2.9 3.0 1.3 2.2 2.3 0.5 2019 2020 2021 9.8 9.8 3.7

PASSENGERS (MILLIONS)

REVENUE (EUR MILLION)

CARGO (TH. UNITS)

EBITDA (EUR MILLION)

Q1 Q2 Q3 Q4

Q1

Q2

Q3

Q4

(1) Unaudited

THE DYNAMICS OF HIGH SEASONALITY ON THE PROFIT LEVEL

NET PROFIT BY QUARTERS (EUR MILLION)

MOST OF THE PROFITS ARE TYPICALLY EARNED IN THE SUMMER, THE HIGH SEASON

Q2 REVENUE DEVELOPMENT BY OPERATING SEGMENTS (EUR MILLION)

Restaurant and shop sales on-board and onshore increased due to various retail activities and higher volume of purchases by travelling passengers

Relatively low increase in ticket sales due to absence of several ad hoc routes/services which were operated in in Q2 2020

High competition in cargo transportation market

Effectively only one hotel operated in Q2 2021

Short-term charter of Silja Europa in June 2021

REVENUE STRUCTURE IN Q2 2021

Q2 REVENUE DEVELOPMENT BY GEOGRAPHICAL SEGMENTS (EUR MILLION)

Revenues of all routes negatively affected by Covid-19, travel restrictions, suspensions in operations and tight competition on cargo market

Estonia-Finland

The results reflect the operations of the Estonia-Finland two shuttle vessels, a cargo vessel and two cruise ferries in June

Estonia-Sweden

The results reflect the operations of two cargo vessels on Paldiski-Kapellskär route (two cruise ferries suspended)

Latvia-Sweden

No daily operations – two cruise ferries suspended

Finland-Sweden

Operations of two cruise ferries on Turku-Stockholm route (two Helsinki-Stockholm route cruise ferries suspended)

Other

Effectively only one hotel operated; increase from various retail activities and charter revenue

TALLINK GRUPP

CONSOLIDATED INCOME STATEMENT

(EUR million)	2019	2020	Q2 2020	(3) Q2 2021
Sales	949	443	65	86
Cost of sales (1)	(752)	(486)	(87)	(95)
Marketing & administrative cost (1)	(125)	(86)	(17)	(17)
Other operating items, net (2)	2	37	16	7
EBITDA	171	8	2	4
Margin (%)	18.0%	1.8%	3.7%	5.1%
Net Result	50	(108)	(27)	(24)
EPS	0.074	(0.162)	(0.041)	(0.036)

Totals may not sum due to rounding

(1) Includes depreciation and amortization

(2) Q2 2021 includes EUR 6.1m direct government assistance; Q2 2020 includes EUR 16.1m direct government assistance; 2020 includes EUR 36.6m net direct government assistance

(3) Unaudited

TALLINK GRUPP

CONSOLIDATED CASH FLOW STATEMENT

(EUR million)	2019	2020	Q2 2020	(1) Q2 2021
Operating cash flow	175	(7)	4	30
Capital expenditure	(61)	(100)	(14)	(3)
Asset disposal	0	0	0	0
Free cash flow	114	(107)	(10)	27
Debt financing (net effect)	(52)	112	19	0
Interests & other financial items	(17)	(16)	(3)	(4)
Dividends & reduction of share capital	(80)	0	0	0
Income tax on dividends paid	(8)	0	0	0
Change in cash	(43)	(11)	5	23

Totals may not sum due to rounding (1) Unaudited

TALLINK GRUPP

CASH FLOW GENERATION AFFECTED BY COVID-19

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(EUR million)	31.12.2019	30.06.2020	31.12.2020	(2) 30.06.2021
Total assets	1 533	1 506	1 516	1 525	1500	Cash Intangibles	Other liabilities
Non-current assets	1 412	1 414	1 427	1 407		Other assets
Current assets	121	92	89	118	1000		Share holders' equity
- of which cash	39	22	28	38		Ships
Total liabilities	710	741	802	869
Interest bearing liabilities	578	616	705	745
Other liabilities	132	125	97	125
Shareholders' equity	823	765	714	656
					500
Net debt/EBITDA	3.1x	5.0x	84.2x	143.2x			Loans
Net debt	539	594	677	707
Equity/assets ratio	54%	51%	47%	43%
(1) BVPS (in EUR)	1.23	1.14	1.07	0.98	0	Assets	Liabilities &
Totals may not sum due to rounding							Equity

(1) Shareholders' equity / number of shares outstanding

(2) Unaudited

TALLINK GRUPP

TOTAL LIQUIDITY OF EUR 116.7 MILLION + EUR 90.0 MILLION UNDRAWN WORKING CAPITAL LOAN

DEBT STRUCTURE

LONG TERM BANK LOANS

• EUR 573 million as at 30.06.2021
• 7 loan agreements outstanding: syndicated loans, amortizing project and working capital loans
• Maturities 1-8 years
• EUR denominated, fixed and EURIBOR floating

OVERDRAFTS (as at 30.06.2021)

• EUR 56 million used
• EUR 79 million unused

SIGNED, NOT YET DRAWN

• EUR 198 million from KfW IPEX-Bank GmbH (MyStar)
• EUR 90 million undrawn of EUR 100 million working capital loan from Nordic Investment Bank

Total EUR 745 million interest bearing liabilities as at 30.06.2021

2021 unaudited

PRINCIPAL PAYMENTS UNDER EXISTING LOAN AGREEMENTS POSTPONED

EUR million

EVENTS AFTER THE REPORTING PERIOD & OUTLOOK

Restaurant at renovated Tallink City Hotel

• Christening of the new LNG powered shuttle vessel MyStar in Rauma shipyard in August 2021. The godmother of the new vessel will be the President of the Republic of Estonia Kersti Kaljulaid.
• Continuing preparations for opening new Burger King restaurants in 2021. In the second half of the year altogether six new restaurants are planned to be opened in Latvia and Lithuania.

Due to the ongoing COVID-19 situation the earnings outlook is uncertain and continues to be strongly affected by external factors such as the progress of vaccination, states' decisions regarding the timing of the lifting of travel restrictions and allowing passenger traffic as well as the duration of the recovery period.

Management expects the passenger traffic between Estonia and Finland to recover rapidly after the restrictions and authorities' advice against travelling have been lifted.

QUESTIONS & ANSWERS

QUESTIONS & ANSWERS

PAAVO NÕGENE CHAIRMAN OF THE MANAGEMENT BOARD

HARRI HANSCHMIDT MEMBER OF THE MANAGEMENT BOARD

JOONAS JOOST FINANCIAL DIRECTOR

THANK YOU

AS Tallink Grupp Sadama 5, 10111, Tallinn, Estonia investor@tallink.ee