Tallink back in the black

2021-11-12T18:46:23+00:00 November 12th, 2021|Finance|

For the third quarter of this year, Tallink Grupp’s unaudited net profit was €5.5 mill, compared with a net loss of €23.9 mill in 3Q20.

Third quarter EBITDA was €35.1 mill, compared with €5.7 mill in the corresponding quarter of 2020.

The Group’s 3Q21 unaudited revenue increased by 18.6%, compared to the same period in 2020, totalling €170.5 mill (€143.7 mill in 3Q20).

The largest contributors to the revenue increase were on board restaurant and shop sales, ticket revenue and charter revenue.

During the period, the company strengthened its liquidity by taking out the loan from the Nordic Investment Bank and carrying out an additional shares offering of the company’s stock in early September.

This has enabled Tallink to secure new capital, creating a strong liquidity buffer for the challenging low season ahead, the company said. The total liquidity buffer (cash, cash equivalents and unused credit facilities) as at 30th September, 2021 amounted to €252.5 mill (€115 mill at 30th September, 2020).

In the first nine months of this year, the Group’s unaudited revenue decreased by 14.7%, compared to the same period in 2020 amounting to €310.3 mill. Unaudited EBITDA for the first nine months was €33.2 mill (€6.9 mill in 2020) and the unaudited net loss was €53.2 mill, compared to a €81.5 mill loss in 2020.

CEO, Paavo Nõgene (pictured), said: “Despite high fuel prices and the continuing COVID impacts on our sector and company, I am pleased that we have been able to earn the first quarterly profit since the start of the continuing pandemic.

“This result has been achieved through a great team effort from everyone at Tallink across all our shores, as well as extremely tight cost control measures. It is the first ray of light we have seen after a period where we have made a net loss of more than €151 mill in roughly a year and a half.

“The quarter’s results were supported by the re-opening of some of our routes for the first time since the start of the pandemic in March, 2020 and short-term charter agreements for two of our vessels.

“For the first time since spring 2020, we only had one vessel suspended in port and all others operating, which has meant revenue, but most importantly work for our people whose numbers at the end of quarter three this year totalled just over 4,500.

“Although investments were not as significant in 3Q21 as they were this time last year, we made significant progress with the construction of our new vessel ‘MyStar’, celebrating the significant milestones of christening and launching of the vessel in August.

“I am sure all our customers are awaiting the new vessel as eagerly as all our employees and we are looking forward to establishing our green bridge between Tallinn and Helsinki with two LNG vessels, using the greenest available fuel option in the maritime sector right now, from spring 2022 onwards.

“So, although the Q3 results have given us a glimmer of hope, we have unfortunately just reached the low season and the high COVID rates in Estonia and Latvia, in addition to the challenging employment market and high fuel prices, are all indicating it will be yet another tough winter ahead.

“Taking out the loans and the company’s shareholders’ further investments into the business through the share emission have therefore all been vital for the long-term sustainability of the company and for the company being well prepared for the tough winter months and low season ahead.

“We remain hopeful that late spring and early summer 2022 will show improvement in the overall situation and we anticipate seeing a marked increase in the number of passengers then,“ he concluded.

Subsequently, Tallink subsidiary, AS Tallink Latvija, and Holland Norway Lines have signed a long-term bareboat charter agreement to operate the ropax ‘Romantika’.

The charterparty will become effective after it is approved by the ship’s mortgagees.

‘Romantika’ will be delivered to the charterer in March, 2022. and the agreement was signed for three years with extension options (3+1+1 years).

Holland Norway Lines plans to operate the vessel on international routes between Norway and the Netherlands.