2016-11-16 08:00:01 CET
2016-11-16 08:00:01 CET
REGULATED INFORMATION
Viking Line - Interim report (Q1 and Q3)
Viking Line's Interim Report for the period January 1 - September 30, 2016
Mariehamn, 2016-11-16 08:00 CET (GLOBE NEWSWIRE) --
Viking Line Abp INTERIM REPORT 16.11.2016, 9.00
AM
VIKING LINE'S INTERIM REPORT FOR THE PERIOD JANUARY 1 - SEPTEMBER 30, 2016.
Consolidated sales of the Viking Line Group for the period January 1 –
September 30, 2016 were 397.3 million euros (EUR 403.1 M for January 1 –
September 30, 2015). Other operating revenue amounted to EUR 2.0 M (0.3).
Operating income totalled EUR 14.8 M (22.5). Net financial items totalled EUR
-3.2 M (-2.9). Consolidated income before taxes amounted to EUR 11.6 M (19.7).
Income after taxes totalled EUR 9.7 M (16.2).
Competition in Viking Line’s service area means there is greater pressure on
prices as well as volumes. The economic trend in Finland is still an
uncertainty factor. However, the bunker price has so far had a favourable
effect on earnings. The Board of Directors' assessment is that operating income
will be lower in 2016 than in 2015.
SALES AND EARNINGS
Consolidated sales of the Viking Line Group for the period January 1 –
September 30, 2016 were 397.3 million euros (EUR 403.1 M for January 1 –
September 30, 2015). Other operating revenue amounted to EUR 2.0 M (0.3).
Operating income totalled EUR 14.8 M (22.5). Net financial items totalled EUR
-3.2 M (-2.9). Consolidated income before taxes amounted to EUR 11.6 M (19.7).
Income after taxes totalled EUR 9.7 M (16.2).
Passenger-related revenue decreased by 0.7 per cent to EUR 362.3 M (364.9) as a
result of lower passenger volume, while cargo revenue decreased by 6.4 per cent
to EUR 32.9 M (35.1). Net sales revenue decreased by 1.9 per cent to EUR 281.5
M (286.9).
Consolidated operating income declined mainly due to lost revenue in connection
with planned and completed vessel dry-dockings for modernization and
maintenance of vessels as well as lower demand during the latter period of the
reporting period. Salary and other employment benefit expenses increased due to
the limiting of restitution in conjunction with a change in the Seamen’s
Pensions Act in Finland. However, the cost effect of this is expected to
decrease during the financial year. Consolidated operating expenses increased
by 1.4 per cent to EUR 247.8 M (244.3). The weaker Swedish krona had a negative
effect on consolidated income.
Consolidated bunker expenses decreased by 22.0 per cent to EUR 29.2 M (37.5) as
a result of lower average bunker prices combined with the Group’s continued
efforts to optimize the bunker consumption of its vessels.
During the third quarter, July 1 – September 30, 2016, consolidated sales
decreased by 2.9 per cent to EUR 159.3 M compared to the year-earlier quarter
(EUR 164.1 M for the period July 1 – September 30, 2015). Third quarter
operating income amounted to EUR 25.3 M (30.1).
SERVICES AND MARKET TRENDS
The Viking Line Group provides passenger and cargo carrier services using seven
vessels on the northern Baltic Sea. The Group’s vessels served the same routes
as in 2015. The extensive vessel modernizations that were carried out during
the spring caused longer service interruptions than normal, which adversely
affected the Group’s market share.
The number of passengers on Viking Line’s vessels during the report period
amounted to 5,015,177 (5,066,883). During the report period, Viking Line
decreased its market share on the Turku (Finland)–Mariehamn/Långnäs (Åland
Islands, Finland)–Stockholm (Sweden) route by 1.5 percentage points to 55.4 per
cent. On the Helsinki (Finland)–Mariehamn–Stockholm route, market share
decreased by 0.7 percentage points to 42.2 per cent. In cruise services between
Stockholm and Mariehamn, market share increased by 0.5 percentage points to
57.6 per cent. On the Helsinki–Tallinn (Estonia) route, market share decreased
by 0.8 percentage points to 23.3 per cent. On the short route over the Sea of
Åland, market share decreased by 0.3 percentage points to 42.0 per cent. The
Group thus had a total market share in its service area of 33.7 per cent
(34.8).
Viking Line’s cargo volume was 98,327 cargo units (99,371). Viking Line
achieved a cargo market share of 20.7 per cent (21.9). Meanwhile the number of
cars transported increased by 28,510 units (+5.5 per cent) to 545,708
(517,198).
INVESTMENTS AND FINANCING
The Group’s investments amounted to EUR 13.4 M (8.0).
In March 2016 Viking Line Abp sold Park Alandia Hotell, which resulted in a
slight increase in consolidated other operating revenue. The hotel served as a
support unit for vessel operations and did not have a material effect on the
Group’s sales, operating income or assets.
On September 30, 2016, the Group’s non-current interest-bearing liabilities
amounted to EUR 154.8 M (178.2). The equity/assets ratio was 44.1 per cent,
compared to 42.2 per cent a year earlier.
At the end of September 2016, the Group’s cash and cash equivalents amounted to
EUR 86.1 M (93.5). Net cash flow from operating activities amounted to EUR 17.5
M (29.7).
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 judgements
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 financial
year. This Interim Report is unaudited.
ORGANIZATION AND PERSONNEL
The average number of Group employees was 2,772 (2,765), of whom 2,078 (2,068)
worked for the parent company. Land-based personnel totalled 666 (676) and
shipboard personnel totalled 2,106 (2,089).
In addition to the Group’s own employees, the Viking XPRS was staffed by an
average of 250 (241) people employed by a staffing company.
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 in the immediate future are primarily related to bunker (vessel
fuel) prices. Fluctuations in bunker prices have a direct impact on the Group’s
earnings. In order to partly offset the risk of higher bunker prices, the Group
has entered into fixed-price agreements related to a portion of its estimated
bunker consumption during 2016.
ONGOING LEGAL ACTIONS
On February 27, 2015, the Helsinki District Court announced its ruling in a
case between Viking Line and the Finnish State regarding fairway charges levied
during the years 2001–2004. According to the judgement, the Finnish State was
required to pay approximately EUR 12.4 M in accordance with Viking Line's claim
as well as legal expenses plus interest. Following the appeal by the Finnish
State, on August 8, 2016, the Helsinki Court of Appeal reversed the Helsinki
District Court’s decision and rejected Viking Line’s claim due to the statute
of limitations. Viking Line has filed a leave to appeal with the Supreme Court
of Finland.
OUTLOOK FOR THE FULL FINANCIAL YEAR 2016
Competition in Viking Line’s service area means there is greater pressure on
prices as well as volumes. The economic trend in Finland is still an
uncertainty factor. However, the bunker price has so far had a favourable
effect on earnings. The Board of Directors' assessment is that operating income
will be lower in 2016 than in 2015.
CONSOLIDATED INCOME STATEMENT
--------------------------------------------------------------------------------
Jul 1, Jul 1, Jan 1, Jan 1, Jan 1,
2016– 2015– 2016– 2015– 2015–
EUR M Sep 30, Sep 30, Sep 30, Sep 30, Dec 31,
2016 2015 2016 2015 2015
--------------------------------------------------------------------------------
SALES 159.3 164.1 397.3 403.1 530.5
Other operating revenue 0.2 0.1 2.0 0.3 0.5
Expenses
Goods and services 45.6 46.0 115.7 116.2 153.2
Salary and other employment 31.0 29.6 92.5 88.5 118.1
benefit expenses
Depreciation and impairment 7.0 6.7 20.9 20.3 27.7
losses
Other operating expenses 50.6 51.7 155.3 155.8 205.5
--------------------------------------------------
134.2 134.0 384.4 380.8 504.6
OPERATING INCOME 25.3 30.1 14.8 22.5 26.4
Financial income 0.5 0.5 3.8 3.8 5.0
Financial expenses -2.5 -3.2 -7.0 -6.7 -8.2
INCOME BEFORE TAXES 23.2 27.4 11.6 19.7 23.2
Income taxes -4.7 -5.4 -1.9 -3.4 -4.4
INCOME FOR THE PERIOD 18.6 22.0 9.7 16.2 18.7
Income attributable to:
Parent company shareholders 18.6 22.0 9.7 16.2 18.7
Earnings per share before and 1.72 2.03 0.90 1.50 1.73
after dilution, EUR
CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
--------------------------------------------------------------------------------
Jul 1, Jul 1, Jan 1, Jan 1, Jan 1,
2016– 2015– 2016– 2015– 2015–
EUR M Sep 30, Sep 30, Sep 30, Sep 30, Dec 31,
2016 2015 2016 2015 2015
--------------------------------------------------------------------------------
INCOME FOR THE PERIOD 18.6 22.0 9.7 16.2 18.7
Other comprehensive income
Items that may be transferred
to the income statement
Translation differences -0.4 -0.3 -0.9 0.0 0.5
Investments available for - 0.6 - -0.2 0.7
sale
--------------------------------------------------
-0.4 0.3 -0.9 -0.2 1.2
COMPREHENSIVE INCOME FOR THE 18.2 22.3 8.8 16.0 19.9
PERIOD
Comprehensive income
attributable to:
Parent company shareholders 18.2 22.3 8.8 16.0 19.9
CONSOLIDATED BALANCE SHEET
-------------------------------------------------------------
EUR M Sep Sep 30, Dec 31,
30,2016 2015 2015
-------------------------------------------------------------
ASSETS
Non-current assets
Intangible assets 1.7 0.7 0.8
Land 0.6 1.1 1.1
Buildings and structures 9.4 10.3 10.0
Renovation costs for rented 2.1 0.8 1.2
properties
Vessels 313.3 328.6 324.5
Machinery and equipment 5.4 6.1 5.5
Investments available for 26.8 25.9 26.8
sale
Receivables 0.2 0.3 0.2
Total non-current assets 359.4 373.7 370.0
Current assets
Inventories 17.8 17.5 17.2
Income tax assets 0.4 0.1 0.5
Trade and other receivables 44.3 41.0 29.4
Cash and cash equivalents 86.1 93.5 110.7
Total current assets 148.6 152.0 157.8
TOTAL ASSETS 508.0 525.7 527.8
EQUITY AND LIABILITIES
Equity
Share capital 1.8 1.8 1.8
Reserves 0.7 -0.2 0.7
Translation differences -1.3 -0.9 -0.4
Retained earnings 223.1 221.0 223.6
-------------------------------
Equity attributable to parent 224.2 221.8 225.7
company shareholders
Total equity 224.2 221.8 225.7
Non-current liabilities
Deferred tax liabilities 34.5 31.4 34.5
Non-current interest-bearing 154.8 178.2 174.0
liabilities
Total non-current liabilities 189.3 209.6 208.4
Current liabilities
Current interest-bearing 19.3 19.3 23.5
liabilities
Income tax liabilities 1.9 3.1 1.3
Trade and other payables 73.3 71.9 68.9
Total current liabilities 94.5 94.3 93.7
Total liabilities 283.8 303.9 302.1
TOTAL EQUITY AND LIABILITIES 508.0 525.7 527.8
CONSOLIDATED CASH FLOW STATEMENT
-------------------------------------------------------------
Jan 1, Jan 1, Jan 1,
2016– 2015– 2015–
EUR M Sep 30, Sep 30, Dec 31,
2016 2015 2015
-------------------------------------------------------------
OPERATING ACTIVITIES
Income for the period 9.7 16.2 18.7
Adjustments
Depreciation and impairment 20.9 20.3 27.7
losses
Capital gains from -1.5 0.0 0.0
non-current assets
Other items not included in 1.1 0.0 -0.5
cash flow
Interest expenses and other 3.9 4.4 5.9
financial expenses
Interest income and other -0.1 -0.1 -0.1
financial income
Dividend income -2.4 -1.6 -1.6
Income taxes 1.9 3.4 4.4
Change in working capital
Change in trade and other -14.9 -11.7 -0.1
receivables
Change in inventories -0.6 -1.4 -1.1
Change in trade and other 5.7 5.9 1.7
payables
Interest paid -4.7 -5.3 -5.4
Financial expenses paid -0.5 -0.5 -0.7
Interest received 0.0 0.0 0.1
Financial income received 0.1 0.0 0.0
Taxes paid -1.1 -0.1 -0.3
NET CASH FLOW FROM
OPERATING ACTIVITIES 17.5 29.7 48.7
INVESTING ACTIVITIES
Investments in vessels -9.9 -6.7 -7.6
Investments in other -3.6 -1.3 -2.4
intangible and tangible
assets
Divestments of other 2.6 0.1 0.1
intangible and tangible
assets
Payments received for - - 0.2
non-current receivables
Dividends received 2.4 1.6 1.6
NET CASH FLOW FROM INVESTING -8.5 -6.3 -8.1
ACTIVITIES
FINANCING ACTIVITIES
Increase in non-current 0.2 - -
liabilities
Amortization of non-current -23.5 -23.5 -23.5
liabilities
Dividends paid -10.3 -7.6 -7.6
NET CASH FLOW FROM FINANCING -33.6 -31.1 -31.1
ACTIVITIES
CHANGE IN CASH AND CASH -24.5 -7.6 9.5
EQUIVALENTS
Cash and cash equivalents at 110.7 101.1 101.1
beginning of period
CASH AND CASH EQUIVALENTS AT 86.1 93.5 110.7
END OF 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, 2016 1.8 0.7 -0.4 223.6 225.7
--------------------------------------------------------------------------------
Income for the period 9.7 9.7
Translation differences 0.0 -0.9 0.0 -0.9
--------------------------------------------------------------------------------
Comprehensive income for the period - 0.0 -0.9 9.7 8.8
Dividend to shareholders -10.3 -10.3
--------------------------------------------------------------------------------
Equity, Sep 30, 2016 1.8 0.7 -1.3 223.1 224.2
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Equity, Jan 1, 2015 1.8 0.0 -0.8 212.3 213.3
--------------------------------------------------------------------------------
Income for the period 16.2 16.2
Translation differences 0.0 -0.1 0.1 0.0
Remeasurement of investments -0.2 -0.2
available for sale
--------------------------------------------------------------------------------
Comprehensive income for the period - -0.2 -0.1 16.3 16.0
Dividend to shareholders -7.6 -7.6
--------------------------------------------------------------------------------
Equity, Sep 30, 2015 1.8 -0.2 -0.9 221.0 221.8
--------------------------------------------------------------------------------
QUARTERLY CONSOLIDATED INCOME STATEMENT
--------------------------------------------------------------------------------
2016 2016 2016 2015
EUR M Q3 Q2 Q1 Q4
--------------------------------------------------------------------------------
SALES 159.3 131.1 106.9 127.4
Other operating revenue 0.2 0.2 1.5 0.2
Expenses
Goods and services 45.6 38.4 31.7 37.0
Salary and other employment benefit expenses 31.0 31.0 30.5 29.6
Depreciation and impairment losses 7.0 7.2 6.7 7.3
Other operating expenses 50.6 53.6 51.1 49.7
---------------------------
134.2 130.2 120.0 123.7
OPERATING INCOME 25.3 1.1 -11.6 3.9
Financial income 0.5 2.8 0.5 1.2
Financial expenses -2.5 -2.4 -2.0 -1.6
INCOME BEFORE TAXES 23.2 1.4 -13.1 3.5
Income taxes -4.7 0.2 2.6 -1.0
INCOME FOR THE PERIOD 18.6 1.6 -10.5 2.5
Income attributable to:
Parent company shareholders 18.6 1.6 -10.5 2.5
Earnings per share before and after dilution, EUR 1.72 0.15 -0.97 0.23
QUARTERLY CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
--------------------------------------------------------------------------------
2016 2016 2016 2015
EUR M Q3 Q2 Q1 Q4
--------------------------------------------------------------------------------
INCOME FOR THE PERIOD 18.6 1.6 -10.5 2.5
Other comprehensive income
Items that may be transferred to the income
statement
Translation differences -0.4 -0.4 -0.1 0.5
Investments available for sale - - - 0.8
---------------------------
-0.4 -0.4 -0.1 1.4
COMPREHENSIVE INCOME FOR THE PERIOD 18.2 1.2 -10.6 3.9
Comprehensive income attributable to:
Parent company shareholders 18.2 1.2 -10.6 3.9
SEGMENT INFORMATION, VIKING LINE GROUP
-----------------------------------------------------------------------------
Jan 1, 2016– Jan 1, 2015– Jan 1, 2015–
OPERATING SEGMENTS, EUR M Sep 30, 2016 Sep 30, 2015 Dec 31, 2015
-----------------------------------------------------------------------------
Sales
-----------------------------------------------------------------------------
Vessels 395.1 399.2 525.1
Unallocated 2.3 4.1 5.6
-----------------------------------------------------------------------------
Total, operating segments 397.4 403.3 530.7
-----------------------------------------------------------------------------
Eliminations -0.2 -0.2 -0.2
-----------------------------------------------------------------------------
Total sales of the Group 397.3 403.1 530.5
-----------------------------------------------------------------------------
Operating income
-----------------------------------------------------------------------------
Vessels 49.4 55.5 71.2
Unallocated -34.6 -32.9 -44.7
-----------------------------------------------------------------------------
Total operating income of the Group 14.8 22.5 26.4
-----------------------------------------------------------------------------
PLEDGED ASSETS AND CONTINGENT LIABILITIES
--------------------------------------------------------------------------------
EUR M Sep 30, Sep 30, Dec 31,
2016 2015 2015
--------------------------------------------------------------------------------
Contingent liabilities 174.1 197.5 197.5
Assets pledged for own debt 313.6 313.6 313.6
FINANCIAL RATIOS AND STATISTICS
--------------------------------------------------------------------------------
Jan 1, Jan 1, Jan 1,
2016– 2015– 2015–
Sep 30, Sep 30, Dec 31,
2016 2015 2015
--------------------------------------------------------------------------------
Equity per share, EUR 20.76 20.54 20.89
Equity/assets ratio 44.1 % 42.2 % 42.8 %
Investments, EUR M 13.4 8.0 10.0
– as % of sales 3.4 % 2.0 % 1.9 %
Passengers 5,015,177 5,066,883 6,568,684
Cargo units 98,327 99,371 133,163
Average number of employees, full-time 2,772 2,765 2,735
equivalent
Earnings per share = (Income before taxes – income taxes +/– non-controlling
interests) / 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 non-controlling interests / (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 2016 will be published on February
16, 2017.
Mariehamn, Åland, November 15, 2016
VIKING LINE ABP
The Board of Directors
Jan Hanses
President and CEO
CEO Jan Hanses, jan.hanses@vikingline.com, +358-18-27000
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