Viking line turns the corner

2021-11-12T19:07:12+00:00 November 12th, 2021|Finance|

Baltic ferry major Viking Line has reported a turnaround in its fortunes during the first nine months of this year.

For example, sales amounted to €169 mill, compared to €154.2 mill for same period of 2020.

Other operating revenue was €44.6 mill, compared to €16.7 mill and operating income totalled €30.5 mill, compared to a loss of €35.2 mill in the first nine months of last year. Income after taxes amounted to €22.7 mill, compared to a negative €30.8 mill.

The 2021 financial year outlook is unchanged, compared to the six month report as of June this year, which means positive operating income for the full year.

For 3Q21, sales totalled €97.5 mill, compared to €56.6 mill in 3Q20 and 3Q21 operating income was €26 mill, compared to a loss of €7.8 mill.

During the third quarter, increased demand for services was seen between Åland, Finland and Sweden. The company’s focus for traffic between Finland and Estonia was to give customers as good a service as possible, combined with cost control.

For the first nine months of this year, passenger-related revenue increased 11.7 % to €137.6 mill, while cargo revenue was slightly up at €29.9 mill.

Results for the third quarter were characterised by a steady increase in demand in the passenger segment and continued stable demand for cargo transportation, the company said.

Jan Hanses, President and CEO, said; “During the financial year, the Group received aid for public service obligations from Traficom for the Group’s vessels on the Turku–Långnäs–Stockholm, Mariehamn-Kapellskär and Helsinki–Tallinn routes. We also received aid from the Development and Management Centre of Finland’s Centres for Economic Development, Transport and the Environment (known as ELY centres) and from Finland’s Local Employment and Economic Development Offices as well as aid for costs from the State Treasury of Finland. The aid is recognised as public aid under other operating revenue.

“In May, Viking Line entered a bareboat hire/purchase agreement for ‘Mariella’. The total sale price was €19.6 mill. The vessel’s book value was €5.6 mill. The sale had a €13.1 mill effect on income, and liquidity was strengthened by €13.5 mill. The remainder of the purchase price is to be paid on a monthly basis over four years beginning 1st June, 2022. The present value is calculated by discounting future payments at a 3% interest rate.

“During the period, the City of Turku redeemed the terminal buildings and related fixtures and fittings owned by Viking Line. The redemption entailed a book profit under IFRS of €10.7 mill. At the same time, the company signed a lease for the terminal and related facilities which runs until 31st December, 2025, and the company will thus continue to use the current terminal and facilities in Turku.

“After that, the plan is to place the new terminal building in Turku in service, with the company using the terminal and other related buildings. The company has also entered a 10-year traffic agreement with the Port of Turku on market terms

“Viking Line Abp received a dividend from Alandia Försäkring prior to its reclassification as an associate company. The dividend is recognised under other operating revenue,” he explained.