Published: 2018-08-15 08:11:46 CEST
Tallinna Sadam
Quarterly report

AS Tallinna Sadam financial results for 2018 2nd quarter and 6 months

In the second quarter and first half of 2018, the volume of cargo handled and the number of passengers served increased as did the Group’s revenue, forming EUR 32.8 million in the second quarter and EUR 62.2 million in the first half of 2018. The adjusted EBITDA was stable, increasing 3.6% to EUR 17.9 million in the second quarter, but the profit for the period decreased by EUR 13.8 million. The loss in the second quarter and first half of the year was caused by the impact of the anticipated income tax expense (EUR 26.3 million) on the record high dividend amount (EUR 105 million), which was announced in April 2018. Based on the management’s estimates, the Group shall achieve the profit target set for 2018 and will be capable of paying dividends in 2019 in accordance with the set dividend policy, i.e. at least EUR 30 million.

The results of the second quarter were mainly driven by the following trends:

  • The overall increase in passenger numbers, while the number of passengers on the Tallinn-Helsinki route decreased by 1%
  • Stabilisation of the liquid bulk volumes
  • In the cargo harbours segment the revenue per ton declined
  • In the ferry segment the increase in the number of passengers and an additional ferry during the summer period on Saaremaa line
  • Signing of the M/V Botnica chartering agreement for summer periods, impact on the financial results will start from the third quarter of 2018.


Key figures (in million EUR):

 Q2Q2+/-6 months6 months+/-
 20182017 20182017 
Revenue32.831.73.4%62.261.51.1%
Adjusted EBITDA17.917.33.6%35.536.5-2.7%
Adjusted EBITDA margin54.8%54.7%-0.157.2%59.4%2.2
Operating profit12.612.32.9%25.027.0-7.5%
Income tax-26.3-12.0118.8%-26.3-12.0118.8%
Profit/loss for the period-14.1-0.34301.3%-2.314.0-116.1%
Investments3.39.2-64.4%5.224.5-78.8%

 

 30.06.201830.06.2017+/-
Total assets656.4651.90.7%
Interest bearing debt228.4241.4-5.4%
Other liabilities87.193.6-7.0%
Equity340.9316.97.6%
Number of shares263.0185.242.0%


Revenue

Revenue grew in second quarter by EUR 1.1 million, i.e. 3%, triggering a rise in the half-year revenue, which grew by EUR 0.7 million, i.e. 1% year on year, to EUR 62.2 million. In the second quarter the revenue grew the most in the ferry segment (by EUR 0.8 million, i.e. 11.8%) due to the additional ferry and trips added for the summer period.
In the passenger harbours’ segment the half-year revenue decreased because in 2017 the average rate of vessel dues was higher and in October 2017 M/V Sea Wind was transferred from the Old City Harbour to Muuga Harbour.
In the cargo harbours’ segment the half-year revenue decreased, mainly due to a decline in cargo charges and rental income (primarily rental income from the former Muuga coal terminal area).
In the segment “other” the revenue grew due to the indexation of the charter fee rate for M/V Botnica.

EBITDA
Both in the first half and second quarter of 2018, adjusted EBITDA grew in the ferry segment and decreased in other segments (year on year). In the second quarter adjusted EBITDA growth in the ferry segment exceeded the decreases in other segments but in the first half-year the impact of decreases proved stronger. In the ferry segment, the adjusted EBITDA margin for the first half-year improved as expected, rising from 31.5% to 42.1%, while in other segments the margins decreased. As a result, the Group’s margin dropped from 59.4% to 57.2%. The changes in the segments’ second-quarter margins were mostly of the same nature but the Group’s margin rose slightly compared with the second quarter of 2017.

Net profit
In connection with the declaration of a record dividend of EUR 105 million in the second quarter of 2018 compared with EUR 48 million in 2017, income tax expense increased by EUR 14.3 million to EUR 26.3 million, which resulted in a loss of EUR 2.3 for the first half of 2018. The net result for the second quarter was a loss of EUR 14.1 million compared with a loss of EUR 0.3 million for the second quarter of 2017. According to the management estimates, the Group shall achieve the profit target set for the 2018 and there will be no deviations from the dividend policy.

Investments
Investments made in the second quarter totaled EUR 3.3 million, in the first half of 2018 the Group made investments of EUR 5.2 million. In 2017 half-year the investments totaled EUR 24.5 million of which around EUR 20 million was related to the construction of new ferries. In the first half of 2018, the largest investments were made in the reconstruction of traffic areas and the implementation of automated traffic control systems at the Old City Harbour and the dry docking of M/V Botnica which is carried out every five years.


Interim condensed consolidated statement of financial position:

In thousands of euros30 June 201831 December 2017
ASSETS  
   
Current assets  
Cash and cash equivalents68,4046,954
Trade and other receivables10,1379,271
Contract assets4190
Inventories407301
Total current assets79,36716,526
   
Non-current assets  
Investments in joint ventures1,1261,256
Other long-term receivables198272
Property, plant and equipment573,657577,125
Intangible assets2,0581,958
Total non-current assets577,039580,611
   
Total assets656,406597,137
   
LIABILITIES  
   
Current liabilities  
Loans and borrowings18,17221,989
Derivative financial instruments511609
Payables to owners20,0000
Provisions1,0271,503
Government grants53303
Taxes payable21,931698
Trade and other payables15,1167,777
Contract liabilities3,86033
Total current liabilities80,67132,912
   
Non-current liabilities  
Loans and borrowings210,228213,611
Government grants23,60723,826
Other payables6464
Contract liabilities928932
Total non-current liabilities234,827238,433
   
Total liabilities315,498271,345
   
EQUITY  
Share capital at par value263,000185,203
Share premium44,4770
Statutory capital reserve18,52018,520
Hedge reserve-511-609
Retained earnings15,422122,678
Total equity340,908325,792
   
Total liabilities and equity656,406597,137


Interim condensed consolidated statement of profit or loss ans other comprehensive income:

     
In thousands of euros Q2 2018Q2 20176 months 20186 months 2017
     
Revenue32,75231,66262,16661,513
Other income2412384444,135
Operating expenses-10,004-9,948-17,587-20,110
Personnel expenses-4,782-4,483-8,972-8,541
Depreciation, amortisation
and impairment
-5,546-5,176-10,949-9,726
Other expenses-50-39-152-290
Operating profit12,61112,25424,95026,981
     
Finance income and costs    
Finance income814818
Finance costs-527-613-1,038-1,088
Finance costs - net-519-599-1,030-1,070
     
Share of profit of
a joint venture accounted
for under the equity method
74257476
Profit before income tax12,16611,68023,99425,987
     
Income tax-26,250-12,000-26,250-12,000
Profit/loss for the period-14,084-320-2,25613,987
Of which attributable
to owners of the Parent
-14,084-320-2,25613,987
     
Basic and diluted earnings
per share (in euros)
-0.070.00-0.010.08
Basic and diluted earnings
per share - continuing
operations (in euros)
-0.070.00-0.010.08


     
In thousands of eurosQ2 2018Q2 2017 6 months 20186 months 2017
     
Profit/loss for the period-14,084-320-2,25613,987
     
Other comprehensive income    
Items that may be reclassified
subsequently to profit or loss:
    
Net fair value gain on
hedging instruments in
cash flow hedges
3310798276
Total other
comprehensive income
3310798276
     
Total comprehensive income/
expense for the period
-14,051-213-2,15814,263
Of which attributable
to owners of the Parent
-14,051-213-2,15814,263


Interim condensed consolidated statement of cash flows:

   
In thousands of euros6 months 20186 months 2017
   
Cash receipts from sale
of goods and services
67,53567,309
Cash receipts related to
other income
56433
Payments to suppliers-20,676-22,976
Payments to and on
behalf of employees
-8,019-7,631
Payments for other expenses-185-677
Income tax paid on dividends0-8,657
Cash from operating activities38,71127,801
   
Purchases of property,
plant and equipment
-5,908-15,854
Purchases of intangible assets-385-362
Proceeds from sale of
property, plant and equipment
0501
Interest received28
Cash used in investing activities-6,291-15,707
   
Contributions to share capital122,2870
Redemption of debt securities-1,250-1,250
Repayments of loans received-3,383-3,383
Change in overdraft (liability)-2,5660
Repayments of finance
lease principal
-1-1
Dividends paid-85,0000
Interest paid-1,020-1,239
Other payments related to
financing activities
-37-1
Cash from/used in
financing activities
29,030-5,874
   
NET CASH FLOW61,4506,220
   
Cash and cash equivalents
at beginning of the period
6,95449,918
Change in cash and cash equivalents61,4506,220
Cash and cash equivalents
at end of the period
68,40456,138


Tallinna Sadam is one of the largest cargo- and passenger port complexes in the Baltic Sea region, which in 2017 serviced 10.6 million passengers and 19.2 million tons of cargo. In addition to passenger and freight services, Tallinna Sadam group also operates in shipping business via its subsidiaries – OÜ TS Laevad provides ferry services between the Estonian mainland and the largest islands, and OÜ TS Shipping charters its multifunctional vessel m/v Botnica for icebreaking and construction services in Estonia and offshore projects abroad. Tallinna Sadam group is also a shareholder of a joint venture AS Green Marine, which provides waste management services. Tallinna Sadam group's sales in 2017 totaled EUR 121.3 million, adjusted EBITDA EUR 66.5 million and net profit EUR 26.4 million.

 

Marko Raid
CFO, Member of the Management Board

 

Additional information:

Marju Zirel
Head of Investor Relations
m.zirel@ts.ee

Attachment


Tallinna Sadam Q2 2018 ENG.pdf