Viking Line in the red

2021-05-14T19:33:55+00:00 May 14th, 2021|Finance|

For the first quarter of this year, ferry operator Viking Line reported sales of €24.6 mill, compared to €75 mill in 1Q20.

Income before taxes amounted to minus €8.9 mill, compared to minus €23.4 mill in 1Q20.

Income after taxes was minus €7.2 mill, compared to minus €18.7 mill in 1Q20.

The outlook for this financial year is unchanged, Viking said. Uncertainty about regulatory requirements, state aid, the impact of vaccination programmes and related restrictions for passenger traffic, and market demand will affect the operations, results and financial position.

As a result, no earnings forecast was provided for 2021.

The COVID-19 pandemic continues to dominate the company’s operations and results, where the focus has been on the company’s public service obligations and the monitoring of costs.

Salary and other employment benefit expenses together with other operating expenses were reduced by more than 50% compared to the same period last year. Since the end of 1Q20, the company’s possibilities for running regular operations have been severely limited by the still ongoing pandemic.

Passenger-related revenue decreased 77.1% to €14.5 mill, compared to €63.2 mill, while cargo revenue amounted to €9.6 mill, compared to €11.3 mill. However, operating costs decreased 54.6% to €32.4 mill.

Results for the first quarter were driven by low market demand in the passenger segment, with revenue from Viking Line’s public service obligations and cargo constituting the most important sources of income.

A large percentage of the staff in Finland were furloughed. In Sweden and Estonia, short-term furloughs were used. In addition to the furloughs, redundancies in the shoreside organisation and on ‘Viking Cinderella’ contributed to the decrease in expenses.

During the period, the Group received aid for its public service obligations from Traficom, as well as aid for re-employment from the Development and Management Centre of Finland’s Centres for Economic Development, Transport and the Environment (known as ELY centres) and of Finland’s Local Employment and Economic Development Offices. The aid is recognised as State aid under other operating revenue.

The total number of passengers on Viking Line’s vessels during the report period was 170,362 (842,229 in 1Q20). The Group had a total market share in its service area of about 28.1%.

Viking Line’s cargo volume was 31,755 units (31,538 in 1Q20) and its share of the cargo market was about 17%. The market share for passenger cars was around 29.6%.

As of 31st March, 2021, the Group’s non-current interest-bearing liabilities totalled €39.9 mill, compared to €92.6 mill in 1Q20. In addition, the Group’s cash and cash equivalents amounted to €24.9 mill.