2015-02-19 08:00:00 CET
2015-02-19 08:00:04 CET
REGULATED INFORMATION
Viking Line - Financial Statement Release
VIKING LINE ABP'S YEAR-END REPORT JANUARY - DECEMBER 2014
Mariehamn, 2015-02-19 08:00 CET (GLOBE NEWSWIRE) --
Viking Line Abp FINANCIAL STATEMENT RELEASE 19.2.2014,
9.00 AM
VIKING LINE ABP'S YEAR - END REPORT JANUARY - DECEMBER 2014.
Consolidated sales of the Viking Line Group during the report period, January 1
- December 31, 2014, decreased by 4.0 per cent to 527.4 million euros (EUR
549.4 M during January 1 - December 31, 2013). Other operating revenue amounted
to EUR 0.7 M (23.5). Operating income amounted to EUR 13.7 M (34.7). Net
financial items totalled EUR 18.6 M (-7.1). Consolidated income before taxes
totalled EUR 32.3 M (27.7). Income after taxes amounted to EUR 30.6 M (27.5).
The Board of Directors proposes to the annual shareholders' meeting that a
dividend of EUR 0,70 per share shall be paid.
SALES AND EARNINGS
FULL CALENDER YEAR
Consolidated sales of the Viking Line Group during the report period, January 1
- December 31, 2014, decreased by 4.0 per cent to 527.4 million euros (EUR
549.4 M during January 1 - December 31, 2013). Other operating revenue amounted
to EUR 0.7 M (23.5). Operating income amounted to EUR 13.7 M (34.7). Net
financial items totalled EUR 18.6 M (-7.1). Consolidated income before taxes
totalled EUR 32.3 M (27.7). Income after taxes amounted to EUR 30.6 M (27.5).
During the report period, passenger-related revenue decreased by 4.9 per cent
to EUR 483.8 M (508.8), while cargo revenue increased by 8.5 per cent to EUR
39.6 M (36.5). Net sales revenue decreased by 4.9 per cent to EUR 379.3 M
(398.8). The Group's operating expenses decreased by 5.0 per cent to EUR 334.4
M (351.9).
The decrease in consolidated sales is primarily explained by the prevailing
pressure on prices in today's tough competitive situation, combined with
falling volume early in 2014 and an economic downturn in Finland that affects
the pattern of consumption. Overall, this has had a negative impact on net
sales revenue per passenger.
The Group's bunker (vessel fuel) expenses decreased during the period by EUR
5.1 M, equivalent to 8.1 per cent. The decrease is explained by lower average
bunker prices and the Group's continued efforts to optimize the bunker
consumption of its vessels.
The Board of Directors believes that the Group's action programme aimed at
improving operational efficiency and boosting sales is continuing to have a
positive impact on earnings.
FOURTH QUARTER
Consolidated sales of the Viking Line Group during the fourth quarter, October
1 - December 31, 2014, decreased by 2.6 per cent to EUR 126.3 M compared to the
corresponding quarter of 2013 (129.7). Operating income during the quarter
amounted to EUR 4.2 M (2.0). Income before taxes during the fourth quarter of
2014 totalled EUR 29.1 M (0.1).
Without items affecting comparability, consolidated net financial items during
the fourth quarter were EUR -2.8 M (-1.9) and consolidated income before taxes
amounted to EUR 1.4 M (0.1).
During the fourth quarter, cargo revenue increased by 7.1 per cent to EUR 10.1
M (9.4), while passenger-related revenue decreased by 3.4 per cent to EUR 115.3
M (119.3).
EARNINGS WITHOUT ITEMS AFFECTING COMPARABILITY
During the financial year 2014, the Group received shares in the Åland-based
insurance company Alandia Försäkring Ab and divested some of these, which
resulted in a nonrecurring item affecting comparability of EUR 27.7 M. During
the financial year 2013, the sale of the Isabella constituted an item affecting
comparability of EUR 22.8 M. Without these items, the Group's operating income
totalled EUR 13.7 M during the financial year 2014 (11.9 during the financial
year 2013). Without these items, consolidated net financial items were EUR -9.1
M (-7.1) and consolidated income before taxes amounted to EUR 4.6 M (4.9).
SERVICES AND MARKET TRENDS
During 2014, the Viking Line Group provided passenger and cargo carrier
services using seven vessels on the northern Baltic Sea. The Group's vessels
served the same routes as during 2013. During the period June 12 - September 2,
2014 the Gabriella and the Mariella served the Helsinki (Finland)-Tallinn
(Estonia) route, while continuing to sail on their regular Helsinki-Mariehamn
(Åland Islands, Finland)-Stockholm (Sweden) route.
In January 2014 the Viking XPRS changed from a Swedish to an Estonian flag and
the Rosella from a Swedish to a Finnish flag.
The number of passengers on Viking Line's vessels during the financial year
increased by 76,496 to 6,610,146 (6,533,650). During the report period, Viking
Line reduced its market share on the Turku (Finland)-Mariehamn/Långnäs (Åland
Islands, Finland)-Stockholm route by 1.0 percentage points to 56.3 per cent. On
the Helsinki-Mariehamn-Stockholm route, market share increased by 0.6
percentage points to 46.7 per cent. In cruise services between Stockholm and
Mariehamn, market share increased by 1.4 percentage points to 54.2 per cent. On
the Helsinki-Tallinn route, market share increased by approximately 1.2
percentage points to 24.8 per cent. On the short route across the Sea of Åland
between Mariehamn and Kapellskär (Sweden), market share increased by 1.6
percentage points to 43.6 per cent. This gave the Group a total market share in
its service area of approximately 35.0 per cent (34.6).
Viking Line's cargo volume was 129,255 cargo units (119,704). Viking Line
achieved a cargo market share of approximately 21.9 per cent (20.9).
INVESTMENTS AND FINANCING
The Group's investments amounted to EUR 7.2 M (172.3, of which 164.0 was for
investments in the Viking Grace).
On December 31, 2014 the Group's non-current interest-bearing liabilities
amounted to EUR 197.5 M (221.2). The equity/assets ratio was 40.0 per cent,
compared to 35.6 per cent a year earlier.
At the end of December 2014, the Group's cash and cash equivalents amounted to
EUR 101.1 M (96.1). Net cash flow from operating activities amounted to EUR
30.7 M (38.4).
DE-MUTUALISATION AND MERGER WITHIN THE ALANDIA INSURANCE GROUP
The Åland-based shipowners' mutual insurance company Redarnas Ömsesidiga
Försäkringsbolag was re-organized into a limited liability insurance company
and merged with its wholly owned insurance subsidiary Försäkringsaktiebolaget
Alandia to form Alandia Försäkring Ab as of December 31, 2014. The merged
company changed its name to Försäkringsaktiebolaget Alandia as of January 1,
2015. The shares in the company were allocated in proportion to the premiums
paid during the years 2011-2013 among those companies that, on the merger date,
had an uninterrupted co-owner relationship with Redarnas Ömsesidiga
Försäkringsbolag that had lasted at least one year.
Upon allocation, the Group received shares in Alandia Försäkring Ab and sold
some of them as of December 31, 2014. After that, Viking Line's shareholding
amounted to 19.9 per cent of the total.
RISK FACTORS
The market for cruises and ferry services in the Baltic Sea is stable but
subject to tough competition. Political decisions may change Viking Line's
operating conditions, with potentially adverse consequences to its business
operations. Åland's special tax status, which makes duty- and tax-free sales
possible on services to and from Åland, is nevertheless permanent. The European
Commission's guidelines for the promotion of seafaring, which makes the net
salary system for shipboard employees possible, are in effect until further
notice. There is no indication that the guidelines will be changed.
The Group's business operations are dependent on functioning logistics and
computer systems. Disruptions in traffic or data communications may have an
adverse impact on the Group's earnings. Viking Line endeavours to minimize the
risk of lengthy unplanned service interruptions by means of continuous vessel
maintenance, a well-developed safety and security system, training and regular
drills. Risks in information management are minimized by developing appropriate
security systems and alternative working methods as well as efforts to ensure
the reliability of computer systems.
The Group's vessels are recognized in the balance sheet at a carrying amount of
EUR 340.1 M (365.2). The vessels have hull and machinery and increased value
insurance totalling EUR 598.0 M (598.0). In addition, all vessels have strike
insurance and protection and indemnity (P&I) insurance.
Fluctuations in bunker (vessel fuel) prices have a direct impact on the Group's
earnings. The European Union's new sulphur directive entered into force on
January 1, 2015 and will lead to higher expenses for the Group. The directive
affects all of the Group's vessels except the Viking Grace, which operates on
liquefied natural gas (LNG).
The Group is also exposed to various financial risks, among them fluctuations
in currency exchange rates. Revenue is generated in euros and Swedish kronor.
Most operational influx of cash and cash equivalents consists of euros. Prices
of goods for sale and bunker are affected by foreign currencies, especially the
US dollar. The Group endeavours to maintain good liquidity in order to be
prepared to deal with adverse changes in operational cash flow.
The Group is exposed to price risk related to shares that are classified as
“Investments available for sale”. The value of the Group's shareholding in the
insurance company Försäkringsaktiebolaget Alandia is established on the basis
of the present value of future cash flows. The cash flow projection is based on
a number of estimates and judgements that have a substantial impact on present
value.
ORGANIZATION AND PERSONNEL
The average number of Group employees was 2,797 (3,104), of whom 2,068 (1,947)
worked for the parent company. Land-based personnel totalled 655 (697) and
shipboard personnel totalled 2,142 (2,407).
In addition to the Group's own employees, the Viking XPRS was staffed by an
average of 235 people employed by a staffing company.
OUTLOOK FOR 2015
During 2015 the Gabriella and the Mariella will again provide expanded summer
service to Tallinn according to a concept similar to the preceding year. These
vessels will thus - in addition to serving their regular Helsinki-Stockholm
routes - also temporarily serve the Helsinki-Tallinn route. Competition in
Viking Line's service area implies continued pressure on both prices and
volume. The economic downturn in Finland is another uncertainty factor, but
recent bunker price developments are currently having a favourable effect on
earnings. The overall assessment of the Board of Directors is that in 2015,
operating income will improve compared to operating income in 2014, but future
bunker price developments represent a significant uncertainty factor.
THE BOARD'S PROPOSAL ON DISTRIBUTION OF EARNINGS
According to the balance sheet of Viking Line Abp on December 31, 2014
unrestricted equity totalled EUR 88,737,247.40.
The Board of Directors proposes to the annual shareholders' meeting that:
A dividend of EUR 0.70 per share shall be paid, totalling EUR
7,560,000.00
Remaining unrestricted equity
EUR 81,177,247.40
No material changes in the Company's financial position have occurred after the
end of the financial year. In the assessment of the Board of Directors, the
dividend is justifiable in light of the demands with respect to the size of the
equity capital which are imposed by the nature, scope, financing and risks
associated with the business.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Oct 1, Oct 1, Jan 1, Jan 1,
2014- 2013- 2014- 2013-
EUR M Dec 31, Dec 31, Dec 31, Dec 31,
2014 2013 2014 2013
--------------------------------------------------------------------------------
SALES 126.3 129.7 527.4 549.4
Other operating revenue 0.2 0.3 0.7 23.5
Expenses
Goods and services 36.2 35.7 148.1 150.6
Salary and other employment benefit 28.9 31.5 120.8 130.1
expenses
Depreciation and impairment losses 7.2 8.3 31.8 35.7
Other operating expenses 50.0 52.5 213.6 221.9
-------------------------------------------
122.3 128.1 514.3 538.2
OPERATING INCOME 4.2 2.0 13.7 34.7
Financial income 28.1 0.3 29.0 1.2
Financial expenses -3.2 -2.2 -10.4 -8.3
INCOME BEFORE TAXES 29.1 0.1 32.3 27.7
Income taxes -1.1 6.7 -1.8 -0.2
INCOME FOR THE PERIOD 28.1 6.7 30.6 27.5
Other comprehensive income
Items that may be transferred to the income
statement
Translation differences -0.4 0.0 -0.9 -0.4
Investments available for sale 0.0 0.0 0.0 0.0
-------------------------------------------
-0.4 0.0 -0.9 -0.4
COMPREHENSIVE INCOME FOR THE PERIOD 27.7 6.7 29.7 27.1
Income attributable to:
Parent company shareholders 28.1 6.7 30.6 27.5
Comprehensive income attributable
to:
Parent company shareholders 27.7 6.7 29.7 27.1
Earnings per share before and after 2.60 0.62 2.83 2.54
dilution, EUR
CONSOLIDATED BALANCE SHEET
EUR M Dec 31, Dec 31,
2014 2013
ASSETS
Non-current assets
Intangible assets 0.6 0.8
Land 1.1 1.1
Buildings and structures 10.8 11.7
Renovation costs for rented 0.6 0.7
properties
Vessels 340.1 365.2
Machinery and equipment 6.7 8.0
Investments available for sale 26.1 0.0
Receivables 0.3 0.5
Total non-current assets 386.3 388.1
Current assets
Inventories 16.1 15.0
Income tax assets 0.3 0.2
Trade and other receivables 29.3 31.0
Cash and cash equivalents 101.1 96.1
Total current assets 146.8 142.2
TOTAL ASSETS 533.1 530.3
EQUITY AND LIABILITIES
Equity
Share capital 1.8 1.8
Reserves 0.0 0.0
Translation differences -0.8 -0.3
Retained earnings 212.3 187.5
---------------------
Equity attributable to parent company 213.3 189.0
shareholders
Total equity 213.3 189.0
Non-current liabilities
Deferred tax liabilities 31.4 29.7
Non-current interest-bearing 197.5 221.2
liabilities
Total non-current liabilities 228.9 250.8
Current liabilities
Current interest-bearing liabilities 23.5 15.1
Income tax liabilities 0.0 -
Trade and other payables 67.4 75.4
Total current liabilities 91.0 90.4
Total liabilities 319.8 341.3
TOTAL EQUITY AND LIABILITIES 533.1 530.3
CONSOLIDATED CASH FLOW STATEMENT
Jan 1, Jan 1,
2014- 2013-
EUR M Dec 31, Dec 31,
2014 2013
--------------------------------------------------------------------------------
OPERATING ACTIVITIES
Income for the period 30.6 27.5
Adjustments
Depreciation and impairment losses 31.8 35.7
Capital gains from non-current -0.2 -22.8
assets
Other items not included in cash 2.1 -0.4
flow
Interest expenses and other financial expenses 6.8 7.1
Financial income, Alandia Försäkring -27.9 -
Ab
Interest income and other financial -0.2 -0.1
income
Dividend income 0.0 0.0
Income taxes 1.8 0.2
Change in working capital
Change in trade and other 1.7 -1.9
receivables
Change in inventories -1.1 0.3
Change in trade and other payables -7.7 -4.1
Interest paid -6.1 -3.7
Financial expenses paid -0.8 -0.8
Interest received 0.1 0.1
Financial income received 0.1 0.1
Taxes paid -0.2 1.4
NET CASH FLOW FROM OPERATING 30.7 38.4
ACTIVITIES
INVESTING ACTIVITIES
Investments in vessels -6.2 -168.6
Investments in other intangible and tangible -1.1 -3.7
assets
Divestments of vessels - 29.9
Divestments of other intangible and tangible 0.3 0.2
assets
Divestments of investments available 1.6 -
for sale
Payments received for non-current 0.2 0.2
receivables
Dividends received 0.0 0.0
NET CASH FLOW FROM INVESTING -5.1 -142.0
ACTIVITIES
FINANCING ACTIVITIES
Increase in non-current liabilities - 179.1
Amortization of non-current -15.2 -24.6
liabilities
Dividends paid -5.4 -
NET CASH FLOW FROM FINANCING -20.6 154.4
ACTIVITIES
CHANGE IN CASH AND CASH EQUIVALENTS 5.0 50.8
Cash and cash equivalents at beginning of 96.1 45.3
period
CASH AND CASH EQUIVALENTS AT END OF 101.1 96.1
PERIOD
STATEMENT OF CHANGES IN CONSOLIDATED EQUITY
Equity attributable to parent
company shareholders
Share Translati Retaine Total
on d
EUR M capita Reserve differenc earning equity
l s es s
--------------------------------------------------------------------------------
Equity, Jan 1, 2013 1.8 0.0 0.1 160.0 162.0
--------------------------------------------------------------------------------
Income for the period 27.5 27.5
Translation differences 0.0 -0.4 0.0 -0.4
Remeasurement of investments 0.0 0.0
available for sale
Total comprehensive income for the - 0.0 -0.4 27.5 27.1
period
Dividend to shareholders -
Equity, Dec 31, 2013 1.8 0.0 -0.3 187.5 189.0
--------------------------------------------------------------------------------
Income for the period 30.6 30.6
Translation differences 0.0 -0.5 -0.4 -0.9
Remeasurement of investments 0.0 0.0
available for sale
Total comprehensive income for the - 0.0 -0.5 30.2 29.7
period
Dividend to shareholders -5.4 -5.4
Equity, Dec 31, 2014 1.8 0.0 -0.8 212.3 213.3
--------------------------------------------------------------------------------
QUARTERLY CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
2014 2014 2014 2014
EUR M Q4 Q3 Q2 Q1
-----------------------------------------------------------------------------
SALES 126.3 160.1 137.5 103.4
Other operating revenue 0.2 0.1 0.3 0.1
Expenses
Goods and services 36.2 44.3 39.1 28.4
Salary and other employment benefit expenses 28.9 30.1 30.3 31.6
Depreciation and impairment losses 7.2 8.0 8.0 8.5
Other operating expenses 50.0 55.8 55.8 52.1
---------------------------
122.3 138.1 133.3 120.6
OPERATING INCOME 4.2 22.0 4.5 -17.1
Financial income 28.1 0.7 0.1 0.1
Financial expenses -3.2 -2.0 -3.1 -2.2
INCOME BEFORE TAXES 29.1 20.7 1.6 -19.1
Income taxes -1.1 -4.0 -0.2 3.5
INCOME FOR THE PERIOD 28.1 16.7 1.4 -15.6
Other comprehensive income
Items that may be transferred to the income statement
Translation differences -0.4 0.0 -0.4 -0.1
Investments available for sale 0.0 - - -
---------------------------
-0.4 0.0 -0.4 -0.1
COMPREHENSIVE INCOME FOR THE PERIOD 27.7 16.7 1.0 -15.8
Income attributable to:
Parent company shareholders 28.1 16.7 1.4 -15.6
Comprehensive income attributable to:
Parent company shareholders 27.7 16.7 1.0 -15.8
Earnings per share before and after dilution, EUR 2.60 1.55 0.13 -1.45
SEGMENT INFORMATION, VIKING LINE GROUP
Jan 1, 2014- Jan 1, 2013-
OPERATING SEGMENTS, EUR M Dec 31, 2014 Dec 31, 2013
---------------------------------------------------------------
Sales
---------------------------------------------------------------
Vessels 521.7 544.7
Unallocated 5.8 4.9
Total, operating segments 527.6 549.6
---------------------------------------------------------------
Eliminations -0.2 -0.2
Total sales of the Group 527.4 549.4
---------------------------------------------------------------
Operating income
---------------------------------------------------------------
Vessels 58.3 81.2
Unallocated -44.6 -46.4
Total operating income of the Group 13.7 34.7
---------------------------------------------------------------
PLEDGED ASSETS AND CONTINGENT LIABILITIES
EUR M Dec 31, Dec 31,
2014 2013
--------------------------------------------------------------------------------
Contingent liabilities 221.1 236.9
Assets pledged for own debt 315.7 315.7
FINANCIAL RATIOS AND STATISTICS
Jan 1, Jan 1,
2014- 2013-
Dec 31, Dec 31,
2014 2013
--------------------------------------------------------------------------------
Equity per share, EUR 19.75 17.50
Dividend per share, EUR 0.70 0.50
Number of shares on balance sheet date 10,800,000 10,800,000
Return on equity (ROE) 15.2 % 15.6 %
Return on investment (ROI) 9.1 % 10.4 %
Equity/assets ratio 40.0 % 35.6 %
Investments, EUR M 7.2 172.3
- as % of sales 1.4 % 31.4 %
Passengers 6,610,146 6,533,650
Cargo units 129,255 119,704
Average number of employees, full time equivalent 2,797 3,104
Earnings per share = (Income before taxes - income taxes +/- minority interest)
/ Average number of shares
Equity per share = Equity attributable to parent company shareholders / Number
of shares on balance sheet date
Return on equity (ROE), % = (Income before taxes - income taxes) / Equity
including minority
interest (average for the year)
Return on investment (ROI), % = (Income before taxes + interest and other
financial expenses)
/ (Total assets - interest-free liabilities [average for
the year])
Equity/assets ratio, % = (Equity including minority interest) / (Total assets -
advances received)
When rounding off items to the nearest EUR 1,000,000,
rounding-off differences of EUR +/- 0.1 M have
occurred.
The above figures from the financial statements have
been audited.
SHAREHOLDERS' MEETING
The annual shareholders' meeting of Viking Line Abp will be held at 12 noon on
Wednesday, April 22, 2015 at the Alandica Kultur och Kongress auditorium,
Strandgatan 33, Mariehamn, Åland, Finland.
An electronic version of the Annual Report for the financial year 2014 will be
published during the week of March 9, 2015 on the Company's website,
www.vikingline.com. The printed Annual Report will be published in Swedish and
Finnish during the week of March 23, 2015.
FINANCIAL INFORMATION FOR 2015
During the financial year 2015, Viking Line Abp's interim reports will be
published for the periods January 1 to March 31, 2015; January 1 to June 30,
2015 and January 1 to September 30, 2015. These interim reports will be
published on May 13, August 20 and November 18, 2015, respectively. The press
release on the results for the fiscal year 2015 will be published on February
18, 2016. The Annual Report for the financial year 2015 will be published
during the week of March 28, 2016.
Mariehamn, Åland, February 18, 2015
VIKING LINE ABP
The Board of Directors
Jan Hanses
President and CEO
CEO Jan Hanses, phone: +358-18-27000, e-mail; jan.hanses@vikingline.com
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