Containerships Oyj - Quarterly report

Containerships plc: Interim report January-September 2016

Containerships plc interim report January-September 2016

  * Turnover €147.3 M (148.6)
  * EBITDA €10.1 M which is 6.8% of net sales (€6.0 M and 4.1%)
  * Net profit €-2.2 M (-5.0)
  * The Company clarifies its estimated net sales: The net sales is expected to
    be less than the previous year. Based on an earlier estimate, the net sales
    were expected to grow 5-10%. The Company keeps its EBITDA estimate at its
    earlier level of €13 M, which will be a 50% growth on the previous year.

Market situation and most important events

CONTAINERSHIPS is a full-service, door-to-door provider of shortsea shipping and
logistics solutions. It ensures safe and rapid cargo transport between Finland,
Russia, the Baltic States, Continental Europe, the UK and Ireland as well as in
the Mediterranean region between Turkey and North Africa. Containerships offers
customers a choice of all standard and special containers, and complete coverage
through a fleet of sea vessels, and road, railway and river container
transportation modes. At the end of the period, 89% of the Company's turnover
came from operations in the region of the Baltic and North Sea and 11% from the
Mediterranean region.

There have not been any significant changes in the Company's business
environment. Russian trade has remained challenging due to sanctions and the
general economic situation. So far, Brexit has not had any effect on the
business. The business environment is not expected to have any significant
changes in the near future.

During the reporting period, the Company finalized its LNG-vessel investment
contracts and received the approval from the bond investors to the modified
vessel financing package. Modifications in the financing package related to the
change of shipyard, which was informed on September 2 and 22. The Company
continues its progress as planned on the LNG investment path. New LNG vessels
are under construction, and they will be delivered during 2018 as informed
earlier.

The Company started its own agency in Algeria in August and simultaneously
terminated its agency agreement with a third party. This is to strengthen the
Company's North African operations.

Results in brief

+-----------------+-------+-------+-------+--------+--------+--------+---------+
|Key Figures, IFRS|Q3/2016|Q2/2016|Q1/2016|1-9/2016|1-9/2015|Change %|1-12/2015|
+-----------------+-------+-------+-------+--------+--------+--------+---------+
|Net Sales, Meur  |   48,4|   49,8|   49,1|   147,3|   148,6|  -0,9 %|    199,6|
+-----------------+-------+-------+-------+--------+--------+--------+---------+
|EBITDA, Meur     |    3,4|    3,4|    3,3|    10,1|     6,0|  67,1 %|      8,3|
+-----------------+-------+-------+-------+--------+--------+--------+---------+
|% of Net Sales   |  7,0 %|  6,9 %|  6,7 %|   6,8 %|   4,1 %|        |    4,2 %|
+-----------------+-------+-------+-------+--------+--------+--------+---------+
|EBIT Meur        |    1,4|    1,4|    1,3|     4,0|    -0,5|        |     -0,4|
+-----------------+-------+-------+-------+--------+--------+--------+---------+
|% of Net Sales   |  2,8 %|  2,7 %|  2,7 %|   2,7 %|  -0,3 %|        |   -0,2 %|
+-----------------+-------+-------+-------+--------+--------+--------+---------+
|Net profit Meur  |   -0,6|   -0,6|   -1,1|    -2,2|    -5,0|  54,9 %|     -6,7|
+-----------------+-------+-------+-------+--------+--------+--------+---------+
|% of Net Sales   | -1,2 %| -1,2 %| -2,3 %|  -1,5 %|  -3,4 %|        |   -3,4 %|
+-----------------+-------+-------+-------+--------+--------+--------+---------+
|Equity Ratio %   |       |       |       |  11,9 %|  17,0 %|        |   13,9 %|
+-----------------+-------+-------+-------+--------+--------+--------+---------+
|Equity Ratio %,  |       |       |       |  20,8 %|  24,8 %|        |   22,3 %|
|adjusted         |       |       |       |        |        |        |         |
+-----------------+-------+-------+-------+--------+--------+--------+---------+
|Personnel in     |       |       |       |        |        |        |      496|
|Average          |       |       |       |        |        |        |         |
+-----------------+-------+-------+-------+--------+--------+--------+---------+
Formulas used to calculate the key figures: Equity ratio = Equity/ total assets
* 100, Adjusted Equity includes the convertible capital loans of about 10 MEUR

This is Containerships plc's third interim report according to IFRS accounting
principles.

The Company's net sales were €48.4 M during the third quarter and were slightly
behind the previous year's net sales (€50.4 M). The cumulative net sales from
January-September were €147.3 M (€148.6 M). The growth of sales in the Baltic
and North Sea slowed down during the third quarter and was 8% between January
and September. The sales volume and the price level in the Mediterranean region
reduced compared to the previous year due to the challenging market and
competition situation. Price erosion in the Baltic and North Sea region stopped
during the third quarter, and the main changes in the prices related to the
changes in trade imbalance in Finland and Russia.

EBITDA of the third quarter remained about at the same level as the previous two
quarters. The Company improved EBITDA by €2.5 M compared to the third quarter of
last year. EBITDA of Jan-Sep was €10.1 M which was 6.8% of net sales (€6.0 M and
4.1%). Cumulative EBITDA exceeded the budgeted level, though the Company did not
reach its sales growth target. Profitability increase came mainly from the
Company's operational improvement program (improved utilization rate and
positioning of the empty containers). Due to this, as well as the price of oil,
operational costs were lower than in the previous quarter. Charter costs of the
vessels increased a bit during the third quarter. Operational costs in the third
quarter of 2015 included one-time legal costs of €0.9 M.

Financial income and expenses have levelled off as the currency fluctuations
were lower during the reporting period. Net loss €560 000 remained on the same
level as on the previous quarter. Cumulative net loss of Jan-Sep was reduced to
€2.2 M (€5.0 M) due to the improved profitability. The own capital in the IFRS
report does not include the two convertible loans totaling about €10 M. The
adjusted own capital with these would be €24 M. A negative cash flow effect
during the reported period of €5.8 M was experienced due to the change in
working capital mainly in reduction of trade payables.

Future outlook

The Company's profitability estimate for 2016 remains unchanged. EBITDA target
is a minimum of €13 M (approximately 50% growth) though the net sales will be
slightly less than in 2015. The implemented efficiency improvements in the
operations are the main drivers for the improved results. These actions will
continue. Especially sales of services will be put into a focus in order to
further develop the business in the growth segments. The Company does not expect
any significant changes in the market situation or conditions. The business
situation in the Mediterranean area is expected to remain challenging.

Construction of LNG vessels (4 units) is underway and they will be delivered as
planned during 2018. The Company continues investing in LNG-fueled trucks. The
Company has acquired an LNG re-fueling station in its UK site. The Company has
also signed a grant agreement with the EU regarding the LNG project. This grant
agreement is a significant support to the Company's environmental strategy and
to the investments related to this field.

Containerships will publish its fourth quarter interim report and the whole year
result of 2016 as earlier stated on 15 March 2017. The reporting schedule of
2017 will be informed by 15 December 2016.

These interim financial statements have been prepared in accordance with the
IFRS accounting and measurement principles, but do not include the disclosure
information required by the IAS 34 Interim Financial Reporting Standard. The
Company did not report the full IFRS quarterly reports during 2015, the annual
report from 2015 was made according to IFRS standards.

Containerships plc issued a senior secured callable bond loan 2015/2019 in 2
April and 28 October in 2015 which has been listed on OMX Helsinki since 1 April
2016.



Further information:

CEO, Kari-Pekka Laaksonen, phone +358 50 550 2555, kari-
pekka.laaksonen(at)containerships.fi

CFO, Jari Lepistö, phone +358 50 60 212, jari.lepisto(at)containerships.fi


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Priedai:

Stock release - Interim report Q3_2016 Containerships plc.pdf