2013-11-14 08:00:00 CET
2013-11-14 08:00:04 CET
REGULATED INFORMATION
Viking Line - Interim report (Q1 and Q3)
VIKING LINES INTERIM REPORT FOR
Viking Line Abp INTERIM REPORT
14.11.2013, 9.00 A.M.
VIKING LINES INTERIM REPORT FOR THE PERIOD JANUARY - SEPTEMBER 2013
Consolidated sales of the Viking Line Group during the report period, January 1
- September 30, 2013, increased by 7.7 per cent to EUR 419.7 M compared to the
corresponding period of 2012 (EUR 389.5 M during January 1 - September 30,
2012). Other operating revenue amounted to EUR 23.2 M (0.3). Operating income
amounted to EUR 32.7 M (3.2). Net financial items totalled EUR -5.1 M (-0.7).
Consolidated income before taxes amounted to EUR 27.6 M (2.5). Income after
taxes totalled EUR 20.7 M (1.7).
Competition in Viking Line's service area remains tough and implies continued
pressure on prices. Market growth is very low, but service on the Viking Grace
is expected to continue its positive performance. The Group has an ongoing
action programme to improve the efficiency of its operations. The Board of
Directors believes that operating income excluding capital gains will improve
in 2013 compared to operating income in 2012. Income before taxes, excluding
the capital gain related to the sale of the Isabella, is expected to be at
about the same level as last year. In addition, the capital gain from the sale
of the Isabella will improve income before taxes by EUR 22.8 M.
SALES AND EARNINGS
Consolidated sales of the Viking Line Group during the report period, January 1
- September 30, 2013, increased by 7.7 per cent to EUR 419.7 M compared to the
corresponding period of 2012 (EUR 389.5 M during January 1 - September 30,
2012). Other operating revenue amounted to EUR 23.2 M (0.3). Operating income
amounted to EUR 32.7 M (3.2). Net financial items totalled EUR -5.1 M (-0.7).
Consolidated income before taxes amounted to EUR 27.6 M (2.5). Income after
taxes totalled EUR 20.7 M (1.7).
Viking Line's market share increased to 34.4 per cent (33.7). Passenger-related
revenue increased by 7.9 per cent to EUR 389.7 M (361.1), while cargo revenue
increased by 5.3 per cent to EUR 27.1 M (25.8). Net sales revenue increased by
9.6 per cent to EUR 304.8 M (278.1). The placement into service of the Viking
Grace on the Turku (Finland)-Mariehamn/ Långnäs (Åland Islands,
Finland)-Stockholm (Sweden) route was the main reason for the improved
passenger-related revenue. Market growth was weak, but the company's earnings
trend was somewhat better than last year. Earnings were pulled down by the
Viking Grace's start-up expenses as well as the Gabriella's unforeseen
dry-docking and 23-day service interruption during the late spring of 2013. The
Group's operating expenses increased by 7.3 per cent to EUR 295.3 M (275.2).
Consolidated income before taxes, excluding a capital gain from the sale of the
Isabella, totalled EUR 4.8 M (2.5).
Consolidated sales during the third quarter, July 1 - September 30, 2013,
increased by 5.1 per cent to EUR 164.4 M compared to the same quarter of 2012
(EUR 156.4 M during July 1 - September 30, 2012). Operating income in the third
quarter amounted to EUR 26.6 M (21.0) and income after taxes totalled EUR 18.9
M (15.8).
SERVICES AND MARKET TRENDS
The Viking Line Group provides passenger and cargo carrier services using seven
vessels on the northern Baltic Sea. In January 2013, the Isabella was replaced
by the Viking Grace on the Turku-Mariehamn/Långnäs-Stockholm route. The
Isabella was sold in April 2013.
The number of passengers on Viking Line's vessels during the report period
increased by 144,432 to 4,998,757 (4,854,325). Viking Line's cargo volume was
88,819 cargo units (88,488). Viking Line achieved a cargo market share of 20.7
per cent (20.0).
During the report period, Viking Line strengthened its market share on the
Turku-Mariehamn/Långnäs-Stockholm route by 8.3 percentage points to 58.3 per
cent. Market share increased on the Helsinki (Finland)-Mariehamn-Stockholm
route by 0.3 percentage points to 45.4 per cent. In cruise services between
Stockholm and Mariehamn, market share decreased by 0.6 per cent to 51.9 per
cent. On the Helsinki-Tallinn (Estonia) route, market share decreased by 1.1
percentage points to 23.0 per cent. On the short route over the Sea of Åland,
market share decreased by 3.1 percentage points to 41.6 per cent, primarily due
to a reduced number of departures. The Group thus had a total market share in
its service area of 34.4 per cent (33.7).
INVESTMENTS AND FINANCING
Of the Group's investments during the report period, its investment in the
Viking Grace totalled EUR 163.5 M, while its other investments amounted to EUR
6.0 M. The Group's total investments were thus EUR 169.5 M (39.9).
The Isabella was sold to Hansalink Limited on April 22, 2013. The sale of the
Isabella was a planned step in the financing of Viking Line's new cruise vessel
Viking Grace. The total sale price was about EUR 30 M and represented a capital
gain of EUR 22.8 M.
On September 30, 2013 the Group's non-current interest-bearing liabilities
amounted to EUR 225.5 M (77.4). The equity/assets ratio was 33.8 per cent,
compared to 45.7 per cent a year earlier.
At the end of September 2013, the Group's cash and cash equivalents amounted to
EUR 88.9 M (41.8). Net cash flow from operating activities amounted to EUR 19.9
M (15.4).
FINANCIAL REPORTING
This Interim Report was prepared in compliance with International Financial
Reporting Standards (IFRSs) and was drawn up as a summary of the financial
statements for the period in compliance with IAS 34. Estimates and judgments as
well as accounting principles and calculation methods are the same as in the
latest annual financial statements. Recognized income taxes are based on an
estimated average tax rate, which is expected to apply throughout the fiscal
year. This Interim Report is unaudited.
ORGANIZATION AND PERSONNEL
The average number of Group employees was 3,151 (3,048), of whom 1,986 (1,860)
worked for the parent company. Land-based personnel totalled 708 (725) and
shipboard personnel totalled 2,443 (2,323).
Andreas Remmer, LL.M, has been a new member of Group Management since September
2013 as Head of Finance and IT (Chief Financial Officer, CFO).
RISK FACTORS
Since the Year-End Report was published, no changes have occurred that affect
the Group's short-term assessment of the risks in its business operations.
Special risks during the immediate future are primarily related to bunker
(vessel fuel) prices.
OUTLOOK FOR THE FULL FINANCIAL YEAR 2013
Competition in Viking Line's service area remains tough and implies continued
pressure on prices. Market growth is very low, but service on the Viking Grace
is expected to continue its positive performance. The Group has an ongoing
action programme to improve the efficiency of its operations. The Board of
Directors believes that operating income excluding capital gains will improve
in 2013 compared to operating income in 2012. Income before taxes, excluding
the capital gain related to the sale of the Isabella, is expected to be at
about the same level as last year. In addition, the capital gain from the sale
of the Isabella will improve income before taxes by EUR 22.8 M.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Jul 1, Jul 1, Jan 1, Jan 1, Jan 1,
2013- 2012- 2013- 2012- 2012-
EUR M Sep 30, Sep 30, Sep 30, Sep 30, Dec 31,
2013 2012 2013 2012 2012
SALES 164.4 156.4 419.7 389.5 516.1
Other operating revenue 0.2 0.1 23.2 0.3 0.4
Expenses
Goods and services 43.4 44.2 114.9 111.5 149.6
Salary and other employment 31.9 30.8 98.5 93.3 125.2
benefit expenses
Depreciation and impairment 8.8 7.0 27.4 21.2 28.5
losses
Other operating expenses 53.8 53.4 169.4 160.6 210.7
------------------------------------------------
137.9 135.5 410.2 386.6 514.1
OPERATING INCOME 26.6 21.0 32.7 3.2 2.4
Financial income 0.3 0.8 0.9 1.3 1.6
Financial expenses -2.0 -0.7 -6.0 -2.0 -2.5
INCOME BEFORE TAXES 25.0 21.1 27.6 2.5 1.6
Income taxes -6.1 -5.2 -6.9 -0.8 -0.7
INCOME FOR THE PERIOD 18.9 15.8 20.7 1.7 0.9
Translation differences -0.1 0.2 -0.3 0.2 0.1
TOTAL COMPREHENSIVE INCOME FOR 18.8 16.0 20.4 1.9 1.0
THE PERIOD
Income attributable to:
Parent company shareholders 18.9 15.8 20.7 1.7 0.9
Total comprehensive income
attributable to:
Parent company shareholders 18.8 16.0 20.4 1.9 1.0
Earnings per share before and 1.75 1.47 1.92 0.16 0.09
after dilution, EUR
CONSOLIDATED BALANCE SHEET
EUR M Sep 30, Sep 30, Dec 31,
2013 2012 2012
ASSETS
Non-current assets
Intangible assets 0.9 1.0 0.9
Land 1.1 1.1 1.1
Buildings and structures 11.8 10.4 12.3
Renovation costs for rented 0.5 0.5 0.5
properties
Vessels 370.5 179.5 174.2
Machinery and equipment 8.3 6.8 8.1
Advance payments - 56.5 61.1
Investments available for sale 0.0 0.0 0.0
Receivables 0.7 0.8 0.7
Total non-current assets 393.6 256.6 258.9
Current assets
Inventories 15.3 15.4 15.2
Income tax assets 0.5 2.4 1.9
Trade and other receivables 40.7 40.2 29.1
Cash and cash equivalents 88.9 41.8 45.3
Total current assets 145.4 99.8 91.5
TOTAL ASSETS 539.0 356.4 350.4
EQUITY AND LIABILITIES
Equity
Share capital 1.8 1.8 1.8
Reserves 0.0 0.0 0.0
Translation differences -0.2 0.2 0.1
Retained earnings 180.8 160.8 160.0
------------------------------
Equity attributable to parent 182.4 162.8 162.0
company shareholders
Total equity 182.4 162.8 162.0
Non-current liabilities
Deferred tax liabilities 29.7 31.2 29.7
Non-current interest-bearing 225.5 77.4 73.1
liabilities
Total non-current liabilities 255.2 108.6 102.8
Current liabilities
Current interest-bearing 19.4 8.7 8.7
liabilities
Income tax liabilities 7.0 0.0 -
Trade and other payables 75.1 76.3 76.9
Total current liabilities 101.5 85.0 85.6
Total liabilities 356.6 193.6 188.4
TOTAL EQUITY AND LIABILITIES 539.0 356.4 350.4
CONSOLIDATED CASH FLOW STATEMENT
Jan 1, Jan 1, Jan 1,
2013- 2012- 2012-
EUR M Sep 30, Sep 30, Dec 31,
2013 2012 2012
OPERATING ACTIVITIES
Income for the period 20.7 1.7 0.9
Adjustments
Depreciation and impairment 27.4 21.2 28.5
losses
Other items not included in -23.1 0.2 0.1
cash flow
Interest expenses and other 5.3 1.3 1.6
financial expenses
Interest income and other -0.1 -0.3 -0.4
financial income
Dividend income 0.0 0.0 0.0
Income taxes 6.9 0.8 0.7
Change in working capital
Change in trade and other -11.6 -11.3 -0.2
receivables
Change in inventories -0.1 -1.8 -1.6
Change in trade and other -3.0 6.4 7.1
payables
Interest paid -3.5 -1.3 -1.6
Financial expenses paid -0.6 -0.1 -0.1
Interest received 0.0 0.4 0.5
Financial income received 0.0 0.0 0.1
Taxes paid 1.5 -1.8 -2.7
NET CASH FLOW FROM
OPERATING ACTIVITIES 19.9 15.4 32.8
INVESTING ACTIVITIES
Investments in vessels -166.7 -2.9 -4.0
Investments in other property, -2.8 -6.9 -11.0
plant and equipment
Advance payments - -30.1 -34.7
Divestments of vessels 29.9 - -
Divestments of other property, 0.2 0.1 0.1
plant and equipment
Change in non-current 0.0 0.0 0.2
receivables
Dividends received 0.0 0.0 0.0
NET CASH FLOW FROM INVESTING -139.3 -39.8 -49.5
ACTIVITIES
FINANCING ACTIVITIES
Increase in non-current 179.1 0.3 1.0
liabilities
Amortization of non-current -16.0 -4.4 -9.4
liabilities
Dividends paid - -5.4 -5.4
NET CASH FLOW FROM FINANCING 163.1 -9.5 -13.7
ACTIVITIES
CHANGE IN CASH AND CASH 43.6 -33.9 -30.4
EQUIVALENTS
Cash and cash equivalents at 45.3 55.7 55.7
beginning of period
Change in held-to-maturity - 20.0 20.0
investments
CASH AND CASH EQUIVALENTS AT 88.9 41.8 45.3
END OF PERIOD
STATEMENT OF CHANGES IN CONSOLIDATED EQUITY
Equity attributable to parent
company shareholders
Share Translatio Retaine Total
n d
EUR M capita Reserve difference earning equity
l s s s
Equity, Jan 1, 2012 1.8 0.0 0.1 164.4 166.3
Income for the period 1.7 1.7
Translation differences 0.0 0.1 0.1 0.2
Total comprehensive income for the - 0.0 0.1 1.8 1.9
period
Dividend to shareholders -5.4 -5.4
Equity, Sep 30, 2012 1.8 0.0 0.2 160.8 162.8
Equity, Jan 1, 2013 1.8 0.0 0.1 160.0 162.0
Income for the period 20.7 20.7
Translation differences 0.0 -0.3 0.0 -0.3
Total comprehensive income for the - 0.0 -0.3 20.7 20.4
period
Dividend to shareholders -
Equity, Sep 30, 2013 1.8 0.0 -0.2 180.8 182.4
QUARTERLY CONSOLIDATED INCOME STATEMENT
2013 2013 2013 2012
EUR M Q3 Q2 Q1 Q4
SALES 164.4 140.3 115.0 126.6
Other operating revenue 0.2 22.9 0.1 0.1
Expenses
Goods and services 43.4 39.6 31.9 38.2
Salary and other employment benefit expenses 31.9 33.7 32.9 31.9
Depreciation and impairment losses 8.8 9.3 9.3 7.3
Other operating expenses 53.8 55.6 59.9 50.0
---------------------------
137.9 138.3 133.9 127.4
OPERATING INCOME 26.6 25.0 -18.9 -0.7
Financial income 0.3 0.4 0.2 0.3
Financial expenses -2.0 -2.0 -2.0 -0.5
INCOME BEFORE TAXES 25.0 23.3 -20.7 -0.9
Income taxes -6.1 -5.8 5.0 0.1
INCOME FOR THE PERIOD 18.9 17.6 -15.7 -0.8
Translation differences -0.1 -0.2 0.0 -0.1
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD 18.8 17.4 -15.8 -0.8
Income attributable to:
Parent company shareholders 18.9 17.6 -15.7 -0.8
Total comprehensive income attributable to:
Parent company shareholders 18.8 17.4 -15.8 -0.8
Earnings per share before and after dilution, EUR 1.75 1.63 -1.45 -0.07
SEGMENT INFORMATION, VIKING LINE GROUP
Jan 1, 2013- Jan 1, 2012- Jan 1, 2012-
OPERATING SEGMENTS, EUR M Sep 30, 2013 Sep 30, 2012 Dec 31, 2012
Sales
Vessels 416.0 385.7 511.1
Unallocated 3.9 4.0 5.3
Total, operating segments 419.9 389.7 516.3
Eliminations -0.2 -0.2 -0.2
Total sales of the Group 419.7 389.5 516.1
Operating income
Vessels 66.3 38.4 52.5
Unallocated -33.6 -35.3 -50.0
Total operating income of the Group 32.7 3.2 2.4
PLEDGED ASSETS AND CONTINGENT LIABILITIES
EUR M Sep 30, Sep 30, Dec 31,
2013 2012 2012
Contingent liabilities 246.2 87.0 84.1
Assets pledged for own debt 316.2 134.9 112.2
Investment commitments not included in the - 198.9 191.9
accounts
- contractual amount - 254.2 253.0
FINANCIAL RATIOS AND STATISTICS
Jan 1, Jan 1, Jan 1,
2013- 2012- 2012-
Sep 30, Sep 30, Dec 31,
2013 2012 2012
Equity per share, EUR 16.88 15.07 15.00
Equity/assets ratio 33.8 % 45.7 % 46.2 %
Investments, EUR M 169.5 39.9 49.7
- as % of sales 40.4 % 10.2 % 9.6 %
Passengers 4,998,757 4,854,325 6,349,903
Cargo units 88,819 88,488 116,906
Average number of employees, full time 3,151 3,048 3,014
equivalent
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
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 may occur.
The Year-end Report for the financial year 2013 will be published on February
13, 2014.
Mariehamn, Åland, November 13, 2013
VIKING LINE ABP
The Board of Directors
Mikael Backman
CEO and President
CEO Mikael Backman, mikael.backman@vikingline.com, +358-(0)18-27000
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