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Published: 2011-07-15 08:40:00 CEST
Tallink Grupp
Quarterly report

Q3 results of the 2010/2011 financial year

Tallinn, 2011-07-15 08:40 CEST -- Q3 results of the 2010/2011 financial year

The revenue of AS Tallink Grupp and its subsidiaries’ (the Group) continued to grow in the third quarter of 2010/2011 financial year (01.03.2011-31.05.2011) in support of the improved revenue per passenger and higher cargo sales from increased cargo units. At the same time the increase was noticeable also in the costs. The quarter started in harsh ice conditions in March and the significantly risen fuel price was dominant throughout the whole quarter.

The Group transported 2 098 356 passengers in the third quarter of 2010/2011 financial year which is 2.7% less than in the same period of the previous financial year as a consequence of different campaigns and tactics in the product offering between the months of second and third quarter. On a cumulative basis the Group has transported 9% more passengers during the nine months of the current financial year compared to the same period of previous financial year. The fourth quarter high season has also started off with a strong 10% year on year increase in the passenger volume.

In the third quarter the positive development continued in the cargo transportation. Derived mainly from the growing economies in the region the Group’s cargo units rose to 76 366 which is 11% more than year ago. 

In the third quarter of the 2010/2011 financial year the Group’s unaudited consolidated revenue was EUR 209.5 million which is EUR 7.1 million or 3.5% more than in the third quarter of the previous financial year. Cargo sales increased by EUR 4.2 million or 17.1% and ticket sales by EUR 2.6 million or 5.2% compared to the third quarter of the previous financial year. Ticket revenue per passenger improved by EUR 1.9 and restaurant and shop sales per passenger by EUR 1.1 which are respectively 8.1% and 2.0% better than year ago.

However, the increase in the revenue in the third quarter did not outperform the increase in the costs and the Group’s earnings were lower than year ago. The largest impact to the cost development came from the increased fuel price. The Group’s ship fuel is priced in relation to the market price of 1% Fuel Oil. On average the  fuel oil price in the third quarter was 33% higher than last year.

In the third quarter of 2010/2011 financial year the Group’s fuel cost increased by EUR 10.3 million compared to the third quarter of previous financial year. Fuel surcharge was added to the passenger tickets starting from June 2011 which together with the existing fuel surcharge system for the cargo is estimated to provide higher compensation to the fuel cost increase in the fourth quarter and onwards.

Fuel cost increase
impact to the results
in EUR millions
Q3

 
9 months

 
Change in revenue +7.1 +59.6
     
Change in operating result before fuel cost +3.1 +22.1
     
Change in fuel cost -10.3 -21.1
     
Change in operating result -7.2 +1

 

 

The Group’s sales and marketing activities during the current financial year have played important role in the overall positive passenger number and revenue growth. In the third quarter the Group’s marketing expenses increased by EUR 2.8 million partly in preparation for the high season which has already shown good payoff in the June passenger bookings.

The Group’s EBITDA in the third quarter of the 2010/2011 financial year was EUR 22.7 million which is EUR 7.2 million or a 24% decrease compared to the third quarter of the previous financial year. In the first nine months of the current financial year the Group’s EBITDA is EUR 68.4 million being EUR 1 million higher than year ago. In the third quarter the Group’s unaudited consolidated net loss was EUR 7.3 million compared to the net loss of EUR 3.0 million last year. In the first nine months of the current financial year the net loss is EUR 15.6 million whereas in the same period of the previous financial year the net loss was EUR 20.6 million.

The increase in the Group’s revenues in the third quarter met the management expectations however the sharply increased fuel costs deteriorated the final result.

 

KEY FIGURES   Q3 2010/2011 Q3 2009/2010 change
Revenue EUR million 209.5 202.4 3%
Gross profit EUR million 30.2 36.8 -18%
Gross margin   14% 18%  
EBITDA EUR million 22.7 30.0 -24%
EBITDA margin   11% 15%  
Net profit / -loss EUR million -7.3 -3.0 -144%
Net profit margin   -3.5% -1.5%  
         
Depreciation & amortisation EUR million 17.8 17.9 -0%
Investments EUR million 4.0 1.3 308%
         
Weighted average number of shares outstanding* 669 882 040 669 882 040 0%
Earnings per share EUR -0.01 -0.00 -144%
         
Number of passengers   2 098 356 2 156 448 -3%
Number of cargo units   76 366 68 991 11%
Average number of employees   6 676 6 429 4%
         
    31.05.2011 28.02.2011  
Total assets EUR million 1 827 1 822 0.3%
Total liabilities EUR million 1 175 1 163 1.1%
Interest bearing liabilities EUR million 1 034 1 033 0.1%
Total equity EUR million 651 659 -1.1%
Equity ratio   36% 36%  
         
Number of shares outstanding*   669 882 040 669 882 040 0%
Shareholders’ equity per share EUR 1.0 1.0  

EBITDA – Earnings before net financial items, taxes, depreciation and amortization;
EBITDA margin – EBITDA / net sales;
Gross margin – gross profit / net sales;
Net profit margin – net profit / net sales;
Equity ratio – total equity / total assets;
Earnings per share – net profit / weighted average number of shares outstanding;
Shareholder’s equity per share – shareholder’s equity / number of shares outstanding.
* Share numbers exclude own shares.

The Management estimates that the growth in the Group revenues will continue in the fourth quarter. The fuel prices have stayed at high levels bringing noticeably higher fuel cost in Q4 of the current financial year compared to the same period a year ago. Overall the Group’s results are estimated to improve.

 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(unaudited, in thousands of EUR) 01.03.2011- 01.03.2010- 01.09.2010- 01.09.2009-
  31.05.2011 31.05.2010 31.05.2011 31.05.2010
           
Revenue 209,489 202,416 601,312 541,709
Cost of sales -179,241 -165,604 -511,517 -457,704
Gross profit 30,248 36,812 89,795 84,005
           
Marketing expenses -15,935 -13,140 -45,808 -40,107
Administrative expenses -9,551 -10,169 -29,948 -29,500
Other income 167 263 486 790
Other expenses -8 -1,656 -25 -1,694
Results from operating activities 4,921 12,110 14,500 13,494
         
Finance income 1,748 -1,817 10,091 5,354
Finance costs -14,018 -13,312 -40,156 -39,332
Share of loss of associates 0 0 -57 0
           
Profit/-loss before income tax -7,349 -3,019 -15,622 -20,484
           
Income tax 0 0 0 0
           
Net profit/-loss for the period -7,349 -3,019 -15,622 -20,484
         
Other comprehensive income/-expense        
Exchange differences on translating foreign operations 234 -239 54 493
Changes in fair value of cash flow hedges 0 -104 -705 1,015
Other comprehensive income/-expense for the period 234 -343 -651 1,508
Total comprehensive income/-expense for the period -7,115 -3,362 -16,273 -18,976
         
Profit/-loss attributable to:        
  Equity holders of the paren -7,349 -3,019 -15,622 -20,484
           
Total comprehensive income/-expense attributable to:        
  Equity holders of the parent -7,115 -3,362 -16,273 -18,976
         
Earnings per share (in EUR per share)        
  - basic -0.01 -0.00 -0.02 -0.03
  - diluted -0.01 -0.00 -0.02 -0.03

   

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(unaudited, in thousands of EUR)

ASSETS 31.05.2011 31.08.2010
       
Current assets    
Cash and cash equivalents 49,637 57,488
Trade and other receivables 42,341 42,040
Prepayments 14,314 9,752
Derivatives 0 705
Inventories 24,840 20,035
Total current assets 131,132 130,020
       
Non-current assets    
Investments in associates 157 214
Other financial assets 322 317
Deferred income tax assets 10,664 10,664
Investment property 300 300
Property, plant and equipment 1,620,717 1,663,100
Intangible assets 63,505 66,700
Total non-current assets 1,695,665 1,741,295
       
TOTAL ASSETS 1,826,797 1,871,315
       
       
LIABILITIES AND EQUITY    
     
Current liabilities    
Interest bearing loans and borrowings 118,204 63,627
Trade and other payables 94,216 94,054
Deferred income 32,979 23,965
Derivatives 13,889 17,634
Total current liabilities 259,288 199,280
       
Non-current liabilities    
Interest bearing loans and borrowings 916,000 1,004,244
Other liabilities 65 74
Total non-current liabilities 916,065 1,004,318
TOTAL LIABILITIES 1,175,353 1,203,598
       
EQUITY    
Equity attributable to equity holders of the parent    
Share capital 404,291 430,648
Share premium 639 639
Reserves 73,049 72,607
Retained earnings 173,465 163,823
Total equity attributable to equity holders of the parent 651,444 667,717
TOTAL EQUITY 651,444 667,717
       
TOTAL LIABILITIES AND EQUITY 1,826,797 1,871,315

 

 CONSOLIDATED CASH FLOW STATEMENT

(unaudited, in thousands of EUR) 01.09.2010 - 01.09.2009 -
    31.05.2011 31.05.2010
Cash flows from operating activities    
Net profit/-loss for the period -15,622 -20,484
Adjustments 84,168 92,108
Changes in assets related to operating activities -9,778 2,873
Changes in liabilities related to operating activities 9,999 6,811
Income tax paid -30 -59
  68,737 81,249
Cash flow used for investing activities    
Purchase of property, plant and equipment and intangible assets -8,242 -5,575
Proceeds from disposals of property, plant and equipment 64 6,466
Issue of shares by associates 0 -587
Payments from settlement of derivatives -3,868 -3,201
Interest received 64 163
  -11,982 -2,734
Cash flow from (+)/ used for (-) financing activities    
Redemption of loans -35,805 -36,665
Change in overdraft 0 -15,765
Repayment of finance lease liabilities -64 -281
Interest paid -28,737 -33,007
  -64,606 -85,718
       
TOTAL NET CASH FLOW -7,851 -7,203
       
Cash and cash equivalents:    
- at the beginning of period 57,488 49,982
- increase (+) / decrease (-) -7,851 -7,203
Cash and cash equivalents at end of period 49,637 42,779

 

         Janek Stalmeister
         Member of the Management Board, CFO
         
         AS Tallink Grupp
         Tel +372 640 9800
         E-mail janek.stalmeister@tallink.ee
         
         
         Harri Hanschmidt
         Head of Investor Relations
         
         AS Tallink Grupp
         Sadama 5/7. 10111 Tallinn
         Tel +372 640 8981
         E-mail harri.hanschmidt@tallink.ee


Interim Q3 eng final.pdf