Interim Report January-March 2012
Finnlines Plc Stock Exchange Release 10 May 2012
INTERIM REPORT JANUARY - MARCH 2012 (unaudited)
JANUARY – MARCH 2012 IN BRIEF
|MEUR||1-3 2012||1-3 2011||1-12 2011|
|Result before interest and taxes (EBIT)||-0.2||-0.1||21.0|
|% of revenue||-0.2||-0.1||3.5|
|Result before taxes (EBT)||-7.1||-6.1||-5.4|
|Result for the reporting period||-5.8||-4.6||-2.5|
|Equity ratio, %||28.4||27.9||29.1|
|Shareholders’ equity/share, EUR||9.02||9.03||9.12|
Calculation of key ratios is presented under ’Calculation of ratios’.
Finnlines is one of the largest North-European liner shipping companies, providing sea transport services mainly in the Baltic and the North Sea. In addition to freight, the Company’s ro-pax vessels carry passengers between six countries and eleven ports. The Company also provides port services in Helsinki, Turku and Kotka. The company has subsidiaries or sales offices in Germany, Belgium, the UK, Sweden, Denmark, Luxembourg and Poland and a representative office in Russia. Finnlines is a Finnish listed company and part of the Italian Grimaldi Group.
GENERAL MARKET DEVELOPMENT
The market volumes in January-March 2012 were on a slightly better level than in 2011. Based on the statistics by the Finnish Transport Agency, the Finnish seaborne imports carried in container, lorry and trailer units increased by 2% and exports by 8% compared to the previous year (measured in tons). According to the statistics published by Shippax, trailer and lorry volumes transported by sea between Southern Sweden and Germany decreased by 2% compared to 2011. During the same period private and commercial passenger traffic between Finland and Sweden decreased by 4%. Between Finland and Germany the corresponding decrease was 2% (Finnish Transport Agency).
During the first quarter the third and the fourth out of six ro-ro newbuildings (MS Finnsky and MS Finnsun) entered the traffic flying the Finnish flag. Finnlines operated on average 23 vessels in its own traffic compared to 24 vessels in the same period in 2011.
The cost of bunker remained high throughout the reporting period.
The cargo volumes transported during January-March totalled approximately 156,000 (155,000 in 2011) units, 16,000 (17,000) cars (not including passengers’ cars ) and 520,000 (499,000) tons of freight not possible to measure in units. In addition, some 118,000 (121,000) private and commercial passengers were transported.
The Finnlines Group recorded revenue totalling EUR 145.0 (139.0) million, an increase of 4.3%. Shipping and Sea Transport Services generated revenue amounting to EUR 135.4 (126.5) million and Port Operations EUR 15.8 (18.7) million. The internal revenue between the segments was EUR 6.2 (6.1) million.
Result before interest, taxes, depreciation and amortisation (EBITDA) was EUR 16.0 (15.1) million.
Result before interest and taxes (EBIT) was EUR -0.2 (-0.1) million. The result includes a non-recurring compensation of EUR 3.4 million from the Jinling shipyard relating to the first two newbuildings covering loss for reduced income. Financial income was EUR 0.1 (0.2) million and financial expenses totalled EUR -7.0 (-6.2) million. Result before taxes (EBT) was EUR -7.1 (-6.1) million and earnings per share (EPS) were EUR -0.12 (-0.10).
STATEMENT OF FINANCIAL POSITION, FINANCING AND CASH-FLOW
Interest-bearing net debt increased by EUR 12.7 million compared to the same period in 2011 and amounted to EUR 900.8 (888.0) million. The equity ratio calculated from the balance sheet was 28.4 (27.9)% and gearing was 212.9 (209.7)%. Vessel lease commitments decreased by EUR 24.7 million from the end of March 2011 due to the redelivery of chartered tonnage.
At the end of the period, cash and deposits together with unused committed working capital credits and the undrawn part of committed credits for newbuildings amounted to EUR 69.0 million. The company has a commercial paper programme amounting to EUR 100 million of which the company has issued EUR 7.9 million at the end of March.
Gross capital expenditure in the reporting period totalled EUR 23.9 (24.6) million and consisted mainly of payments for newbuildings (19.4 million). Total depreciation amounted to EUR 16.2 (15.2) million. Four of the six newbuildings ordered from the Jinling shipyard in China have been delivered, MS Finnbreeze and MS Finnsea in March 2011 and MS Finnsky and MS Finnsun in the beginning of 2012. The last two of the newbuildings are scheduled to be delivered during the last quarter of 2012.
The Group employed an average of 1,991 (2,039) persons during the period, consisting of 984 (1,102) persons on shore and 1,007 (937) persons at sea. The average number of sea personnel increased due to two newbuildings taken into use during the reporting period. The number of shore personnel decreased mainly due to employee reductions carried out in the Port Operations. The employee co-operation negotiations with personnel in Kotka were completed in January 2012 resulting in termination of 23 employments in total.
DECISIONS TAKEN BY THE ANNUAL GENERAL MEETING
The Annual General Meeting of Finnlines Plc held on 17 April 2012 approved the Financial Statements and discharged the members of the Board of Directors and the President and CEO from liability for the financial year 2011.
The Annual General Meeting approved the Board of Directors’ proposal not to pay any dividend.
The Annual General Meeting decided that the Board of Directors shall have seven members. The current Board Members were re-elected to the Board: Mr Emanuele Grimaldi, Mr Gianluca Grimaldi, Mr Diego Pacella, Mr Olav Rakkenes and Mr Jon-Aksel Torgersen. In addition, Mr. Christer Backman and Ms. Tiina Bäckman were elected as new Members. The Board of Directors elected Mr Emanuele Grimaldi as Chairman and Mr Diego Pacella as Vice-Chairman.
The Authorised Public Audit Firm Deloitte & Touche Oy was appointed as the Company’s auditors for 2012.
The Annual General Meeting authorised the Board of Directors to resolve on the issuance of new shares in one or several tranches so that the total number of shares issued based on the authorization is 20 000 000 at maximum. The authorization is valid until the next Annual General Meeting. The authorization replaces the Annual General Meeting’s authorization to decide on a share issue of 19 April 2011.
The 2011 Financial statements, published in March 2012, contains a thorough description of Finnlines’ risks and risk management, and there are no essential changes to that report.
ESSENTIAL CHANGES IN LEGAL PROCEEDINGS
The 2011 Financial statements contains a thorough description of legal proceedings and the following is a description of the changes compared to what was reported in the financial statements:
In January 2012, Mutual Pension Insurance Company Ilmarinen filed an application for a leave to appeal and a petition of appeal with the Supreme Court regarding the judgement of the Helsinki Court of Appeal of 29 November 2011 in which the Court of Appeal overruled the judgement rendered by the Helsinki District Court on 3 March 2010 and dismissed all claims presented against Finnlines Plc by Ilmarinen.
EVENTS AFTER THE REPORTING PERIOD
There are no essential events after the reporting period.
OUTLOOK FOR THE REMAINING PART OF 2012
The Board expects 2012 still to be a volatile and challenging year. The Company is well prepared to face the market challenges.
The second interim report of 2012 for the period of 1 January – 30 June will be published on Thursday, 26 July 2012.
The Board of Directors
Uwe Bakosch, President/CEO