|
During the nine months of the 2007/2008 financial year AS Tallink Grupp's (Hereinafter also referred to as the Group) performance was largely influenced by significantly increased fuel costs, higher interest costs and weak traffic volumes on some routes.
The addition of fuel surcharges to the passenger tickets in February 2008 has helped to increase the ticket revenues but not in the full extent of the fuel cost increase. In the third quarter the total fuel cost increase was approximately 156 million EEK (10 million EUR) compared to the third quarter of the previous financial year. Since the beginning of the current financial year in September 2007 until today the price of the fuel for our vessels has increased by approximately 115%. The average fuel price in the third quarter was about 93% higher than in the third quarter of last financial year.
Although the Group was able to improve the EBITDA by 7% which reached 425 million EEK (27 million EUR) in the third quarter of the 2007/2008 financial year, the result after the increased interest costs and depreciation is a net loss of 34 million EEK (2.2 million EUR).
Strong positive development came from Estonia-Finland operations where the new Shuttle service has improved traffic volumes and increased revenues by almost 35%. The segment result shows an increase of 28 million EEK (1.8 million EUR).
Following the integration of our sales offices in Finland and Sweden and partly also from the implementation of the new booking system the sales activities have not been as effective as expected and consequently the traffic volumes between Finland and Sweden have stayed below previous year levels. It is expected that re-routing of M/S Galaxy to Turku-Stockholm route will increase the attractiveness of the route in the market and helps to reach higher passenger volumes. Also additional changes in the sales strategies are currently being implemented to improve the traffic numbers.
9 MONTHS KEY FIGURES
| |
01.09.2007-31.05.2008 |
01.09.2006-31.05.2007 |
change |
| |
EEK |
EUR |
EEK |
EUR |
% |
| Net sales (million) |
8,599.2 |
549.6 |
8,351.3 |
533.7 |
3.0 |
| Gross profit (million) |
1,761.6 |
112.6 |
1,838.7 |
117.5 |
-4.2 |
| Gross margin (%) |
20.5 |
|
22.0 |
|
|
| EBITDA (million) |
1,206.0 |
77.1 |
1,185.3 |
75.8 |
1.7 |
| EBITDA margin (%) |
14.0 |
|
14.2 |
|
|
| Net profit for the period (million) |
-142.9 |
-9.1 |
41.4 |
2.6 |
-445.4 |
| Net profit margin (%) |
-1.7 |
|
0.5 |
|
|
| |
|
|
|
|
|
| Depreciation (million) |
690.0 |
44.1 |
712.0 |
45.5 |
-3.1 |
| Investments (million) |
2,142.9 |
137.0 |
2,145.0 |
137.1 |
-0.1 |
| |
|
|
|
|
|
| Weighted average number of ordinary shares outstanding during nine months |
671,702,752 |
673,817,040 |
-0.3 |
| Earnings per share |
-0.21 |
-0.01 |
0.06 |
0.004 |
-446.5 |
| |
|
|
|
|
|
| Number of passengers |
4,707,546 |
4,541,160 |
3.7 |
| Cargo units |
256,032 |
270,912 |
-5.5 |
| Average number of employees |
6,428 |
6,093 |
5.5 |
| |
|
|
|
|
|
| |
31.05.2008 |
31.08.2007 |
change |
| |
EEK |
EUR |
EEK |
EUR |
% |
| Total assets (million) |
27,468.6 |
1,755.6 |
26,570.9 |
1,698.2 |
3.4 |
| Total liabilities (million) |
17,539.6 |
1,121.0 |
16,436.0 |
1,050.4 |
6.7 |
| Interest-bearing liabilities (million) |
15,586.8 |
996.2 |
14,831.7 |
947.9 |
5.1 |
| Total equity (million) |
9,929.0 |
634.6 |
10,134.9 |
647.7 |
-2.0 |
| Liquidity ratio |
0.520 |
|
0.665 |
|
|
| Equity ratio (%) |
36.1 |
|
38.1 |
|
|
| |
|
|
|
|
|
| Number of ordinary shares outstanding |
669,882,040 |
673,817,040 |
-0.6 |
| Shareholders equity per share |
14.82 |
0.95 |
15.04 |
0.96 |
-1.5 |
Net profit margin - net profit / net sales;
EBITDA - Earnings before net financial items, share of profit of associates, taxes, depreciation and amortization, income from negative goodwill;
EBITDA margin - EBITDA / net sales;
Gross margin - gross profit / net sales
Liquidity ratio - current assets / current liabilities
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 have been adjusted in connection with the bonus issue in January 2007
SALES AND EARNINGS
Net sales of the Group amounted to 8,559.2 million EEK (549.6 million EUR) in the nine months of 2007/2008 financial year (September 01, 2007 - May 31, 2008) compared to 8,351.3 million EEK (533.7 million EUR) in the nine months of 2006/2007 financial year (September 01, 2006 - May 31, 2007). The sales were positively affected by the first ever winter period of fast ferry operation between Tallinn and Helsinki by Tallink Shuttle service.
The Group's gross profit decreased 77.1 million EEK (4.9 million EUR) to 1,761.6 million EEK (112.6 million EUR), EBITDA increased by 1.7% to 1,206.0 million EEK (77.1 million EUR) and the net profit decreased by 184.3 million EEK (11.8 million EUR) from 41.4 million EEK (2.6 million EUR) to -142.9 million EEK (-9.1 million EUR). Basic earnings per share and diluted earnings per share were -0.21 EEK (-0.01 EUR) in the nine months of 2007/2008 financial year compared to 0.06 EEK (0.00 EUR) in the corresponding period in 2006/2007 financial year.
The Group's earnings were negatively affected by the high fuel price. Compared to the nine months of the previous financial year the Group's fuel costs have increased by around 468 million EEK (30 million EUR). Around 40% of the increase came from the Finland-Germany route. Group's management has already taken action towards improving the route and has agreed to charter out one of the Superfast vessels, Superfast IX, on a five year contract starting from autumn 2008. The charter serves the objective of improving the return on the capital of the Superfast vessels and maintaining the overall Group's return ratios.
In order to reduce the impact from the increased fuel price the fuel surcharges, previously included only in the cargo fares, were introduced also to the passenger tickets effective from February 2008.
The Group's earnings were also affected by higher interest rates. During the nine month period Group's interest expenses increased by 121.2 million EEK (7.7 million EUR).
CONSOLIDATED CONDENSED INCOME STATEMENT
| |
|
|
|
|
| (unaudited, in thousands of EEK) |
01.03.2008-31.05.2008 |
01.03.2007-31.05.2007 |
01.09.2007-31.05.2008 |
01.09.2006-31.05.2007 |
| Net sales |
2,936,043 |
2,902,495 |
8,599,203 |
8,351,273 |
| Cost of sales |
-2,322,753 |
-2,218,578 |
-6,837,587 |
-6,512,606 |
| Gross profit |
613,290 |
683,917 |
1,761,616 |
1,838,667 |
| |
|
|
|
|
| Marketing expenses |
-208,673 |
-241,528 |
-588,913 |
-645,216 |
| Administrative and general expenses |
-224,196 |
-274,926 |
-693,373 |
-754,165 |
| Other operating items |
19,157 |
19,221 |
36,674 |
27,471 |
| Income from negative goodwill |
0 |
0 |
0 |
689 |
| Financial income |
17,622 |
56,121 |
48,234 |
147,166 |
| Financial expenses |
-251,302 |
-210,728 |
-707,004 |
-578,277 |
| Income from associates |
0 |
6,493 |
0 |
6,493 |
| |
|
|
|
|
| Profit/-loss from normal operation before income tax |
-34,102 |
38,570 |
-142,766 |
42,828 |
| |
|
|
|
|
| Income tax |
-62 |
205 |
-172 |
-1,448 |
| |
|
|
|
|
| Net profit/-loss for the period |
-34,164 |
38,775 |
-142,938 |
41,380 |
| Attributable to: |
|
|
|
|
| Equity holders of the parent |
-34,164 |
38,775 |
-142,938 |
41,380 |
| |
|
|
|
|
| Earnings per share (in EEK per share) |
|
|
|
|
| - basic |
-0.05 |
0.06 |
-0.21 |
0.06 |
| - diluted |
-0.05 |
0.06 |
-0.21 |
0.06 |
| |
|
|
|
|
| (unaudited, in thousands of EUR) |
01.03.2008-31.05.2008 |
01.03.2007-31.05.2007 |
01.09.2007-31.05.2008 |
01.09.2006-31.05.2007 |
| Net sales |
187,647 |
185,504 |
549,589 |
533,744 |
| Cost of sales |
-148,451 |
-141,793 |
-437,001 |
-416,231 |
| Gross profit |
39,196 |
43,711 |
112,588 |
117,513 |
| |
|
|
|
|
| Marketing expenses |
-13,336 |
-15,437 |
-37,638 |
-41,237 |
| Administrative and general expenses |
-14,329 |
-17,571 |
-44,315 |
-48,200 |
| Other operating items |
1,224 |
1,229 |
2,344 |
1,756 |
| Income from negative goodwill |
0 |
0 |
0 |
44 |
| Financial income |
1,127 |
3,587 |
3,083 |
9,406 |
| Financial expenses |
-16,061 |
-13,468 |
-45,186 |
-36,959 |
| Income from associates |
0 |
415 |
0 |
415 |
| |
|
|
|
|
| Profit/-loss from normal operation before income tax |
-2,179 |
2,466 |
-9,124 |
2,738 |
| |
|
|
|
|
| Income tax |
-4 |
13 |
-11 |
-93 |
| |
|
|
|
|
| Net profit/-loss for the period |
-2,183 |
2,479 |
-9,135 |
2,645 |
| Attributable to: |
|
|
|
|
| Equity holders of the parent |
-2,183 |
2,479 |
-9,135 |
2,645 |
| |
|
|
|
|
| Earnings per share (in EEK per share) |
|
|
|
|
| - basic |
0.00 |
0.00 |
-0.01 |
0.00 |
| - diluted |
0.00 |
0.00 |
-0.01 |
0.00 |
CONSOLIDATED CONDENSED BALANCE SHEET
(unaudited, in thousands of EEK)
| ASSETS |
31.05.2008 |
31.08.2007 |
| Current assets |
|
|
| Cash and cash equivalents |
444,962 |
1,303,609 |
| Receivables |
1,208,035 |
815,093 |
| Prepayments |
146,622 |
124,134 |
| Derivatives |
0 |
1,799 |
| Inventories |
325,643 |
272,352 |
| Total current assets |
2,125,262 |
2,516,987 |
| |
|
|
| Non-current assets |
|
|
| Investments in associates |
5,282 |
3,242 |
| Other financial assets and prepayments |
7,621 |
9,279 |
| Deferred income tax assets |
153,277 |
153,102 |
| Investment property |
4,694 |
4,694 |
| Property, plant and equipment |
23,901,464 |
22,600,001 |
| Intangible assets |
1,270,953 |
1,283,592 |
| Total non-current assets |
25,343,291 |
24,053,910 |
| |
|
|
| TOTAL ASSETS |
27,468,553 |
26,570,897 |
| |
|
|
| LIABILITIES AND EQUITY |
|
|
| Current liabilities |
|
|
| Current portion of interest-bearing liabilities |
2,202,334 |
2,247,390 |
| Payables |
1,681,620 |
1,408,369 |
| Deferred income |
182,533 |
121,008 |
| Derivatives |
21,990 |
7,980 |
| Total current liabilities |
4,088,477 |
3,784,747 |
| |
|
|
| Non-current liabilities |
|
|
| Interest bearing loans and borrowings |
13,384,477 |
12,584,261 |
| Deferred income tax liability |
63,447 |
63,463 |
| Pension liability |
3,192 |
3,489 |
| Total non-current liabilities |
13,451,116 |
12,651,213 |
| TOTAL LIABILITIES |
17,539,593 |
16,435,960 |
| |
|
|
| EQUITY |
|
|
| Equity attributable to equity holders of the parent |
|
|
| Share capital |
6,738,170 |
6,738,170 |
| Share premium |
9,999 |
9,999 |
| Reserves |
1,192,417 |
1,202,991 |
| Retained earnings |
1,988,374 |
2,183,777 |
| Total equity attributable to equity holders of the parent |
9,928,960 |
10,134,937 |
| TOTAL EQUITY |
9,928,960 |
10,134,937 |
| |
|
|
| TOTAL LIABILITIES AND EQUITY |
27,468,553 |
26,570,897 |
CONSOLIDATED CONDENSED BALANCE SHEET
(unaudited, in thousands of EUR)
| ASSETS |
31.05.2008 |
31.08.2007 |
| Current assets |
|
|
| Cash and cash equivalents |
28,438 |
83,315 |
| Receivables |
77,208 |
52,094 |
| Prepayments |
9,371 |
7,934 |
| Derivatives |
0 |
115 |
| Inventories |
20,812 |
17,407 |
| Total current assets |
135,829 |
160,865 |
| |
|
|
| Non-current assets |
|
|
| Investments in associates |
338 |
207 |
| Other financial assets and prepayments |
487 |
594 |
| Deferred income tax assets |
9,796 |
9,785 |
| Investment property |
300 |
300 |
| Property, plant and equipment |
1,527,582 |
1,444,403 |
| Intangible assets |
81,229 |
82,036 |
| Total non-current assets |
1,619,732 |
1,537,325 |
| |
|
|
| TOTAL ASSETS |
1,755,561 |
1,698,190 |
| |
|
|
| LIABILITIES AND EQUITY |
|
|
| Current liabilities |
|
|
| Current portion of interest-bearing liabilities |
140,755 |
143,634 |
| Payables |
107,475 |
90,011 |
| Deferred income |
11,666 |
7,734 |
| Derivatives |
1,405 |
510 |
| Total current liabilities |
261,301 |
241,889 |
| |
|
|
| Non-current liabilities |
|
|
| Interest bearing loans and borrowings |
855,424 |
804,281 |
| Deferred income tax liability |
4,055 |
4,056 |
| Pension liability |
204 |
223 |
| Total non-current liabilities |
859,683 |
808,560 |
| TOTAL LIABILITIES |
1,120,984 |
1,050,449 |
| |
|
|
| EQUITY |
|
|
| Equity attributable to equity holders of the parent |
|
|
| Share capital |
430,648 |
430,648 |
| Share premium |
639 |
639 |
| Reserves |
76,209 |
76,885 |
| Retained earnings |
127,081 |
139,569 |
| Total equity attributable to equity holders of the parent |
634,577 |
647,741 |
| TOTAL EQUITY |
634,577 |
647,741 |
| |
|
|
| TOTAL LIABILITIES AND EQUITY |
1,755,561 |
1,698,190 |
CONSOLIDATED CONDENSED CASH FLOW STATEMENT
(unaudited, in thousands of EEK)
|
01.09.2007-31.05.2008 |
01.09.2006-31.05.2007 |
| Cash flows from operating activities |
|
|
| Net profit/-loss for the period |
-142,938 |
41,380 |
| Adjustments |
1,339,130 |
1,129,215 |
| Changes in assets related to operating activities |
-411,372 |
129,412 |
| Changes in inventories |
-52,273 |
-26,031 |
| Changes in liabilities related to operating activities |
279,939 |
-194,544 |
| Income tax repaid/-paid |
288 |
-268 |
| |
1,012,774 |
1,079,164 |
| Cash flow used for investing activities |
|
|
| Purchase of property, plant, equipment and intangible assets |
-2,142,902 |
-2,145,034 |
| Proceeds from disposals of property, plant, equipment |
200,536 |
243,222 |
| Proceeds from settlement of derivatives |
53,367 |
68,328 |
| Payments of settlement of derivatives |
-18,146 |
-42 |
| Acquisition of subsidiary |
1,885 |
0 |
| Acquisition of associate |
-2,040 |
0 |
| Acquisition of of minority interests |
0 |
-1,157 |
| Interest received |
8,501 |
17,415 |
| |
-1,898,799 |
-1,817,268 |
| Cash flow from (+)/ used for (-) financing activities |
|
|
| Payment of transaction costs |
-65 |
-6,520 |
| Repurchase of own shares |
-65,067 |
0 |
| Proceeds from loans and bonds |
1,401,617 |
1,357,847 |
| Redemption of loans and bonds |
-1,192,822 |
-985,765 |
| Change in overdraft |
531,195 |
266,989 |
| Repayment of finance lease liabilities |
-10,030 |
-30,562 |
| Interest paid |
-637,450 |
-565,290 |
| |
27,378 |
36,699 |
| TOTAL NET CASH FLOW |
-858,647 |
-701,405 |
| Cash and cash equivalents: |
|
|
| - at the beginning of period |
1,303,609 |
1,407,608 |
| - increase (+) / decrease (-) |
-858,647 |
-701,405 |
| Cash and cash equivalents at end of period |
444,962 |
706,203 |
CONSOLIDATED CONDENSED CASH FLOW STATEMENT
(unaudited, in thousands of EUR)
|
01.09.2007-31.05.2008 |
01.09.2006-31.05.2007 |
| Cash flows from operating activities |
|
|
| Net profit/-loss for the period |
-9,135 |
2,645 |
| Adjustments |
85,586 |
72,170 |
| Changes in assets related to operating activities |
-26,291 |
8,271 |
| Changes in inventories |
-3,341 |
-1,664 |
| Changes in liabilities related to operating activities |
17,891 |
-12,434 |
| Income tax repaid/-paid |
18 |
-17 |
| |
64,728 |
68,971 |
| Cash flow used for investing activities |
|
|
| Purchase of property, plant, equipment and intangible assets |
-136,956 |
-137,092 |
| Proceeds from disposals of property, plant, equipment |
12,817 |
15,545 |
| Proceeds from settlement of derivatives |
3,411 |
4,367 |
| Payments of settlement of derivatives |
-1,160 |
-3 |
| Acquisition of subsidiary |
120 |
0 |
| Acquisition of associate |
-130 |
0 |
| Acquisition of of minority interests |
0 |
-74 |
| Interest received |
543 |
1,113 |
| |
-121,355 |
-116,144 |
| Cash flow from (+)/ used for (-) financing activities |
|
|
| Payment of transaction costs |
-4 |
-417 |
| Repurchase of own shares |
-4,159 |
0 |
| Proceeds from loans and bonds |
89,580 |
86,782 |
| Redemption of loans and bonds |
-76,235 |
-63,002 |
| Change in overdraft |
33,950 |
17,064 |
| Repayment of finance lease liabilities |
-641 |
-1,954 |
| Interest paid |
-40,741 |
-36,128 |
| |
1,750 |
2,345 |
| TOTAL NET CASH FLOW |
-54,877 |
-44,828 |
| Cash and cash equivalents: |
|
|
| - at the beginning of period |
83,315 |
89,963 |
| - increase (+) / decrease (-) |
-54,877 |
-44,828 |
| Cash and cash equivalents at end of period |
28,438 |
45,135 |
Janek Stalmeister
Financial Director
AS Tallink Grupp
Tel. +372 6409 800
e-mail: janek.stalmeister@tallink.ee
|