CEO's review


THE FINANCIAL YEAR 2017 WAS A FASCINATING YEAR FOR FINNLINES. While we celebrated our 70-year anniversary, we delivered again, for the third year in a row, a record-breaking result, EUR 82.7 million, which was over 20 per cent better than the previous year’s result for the period. 

THE FINNISH ECONOMY STARTED TO GROW ALREADY AT THE END OF 2016 AND THE GROWTH ACCELERATED DURING 2017. The sea freight volumes in Finland grew over 12 per cent during the year, yet, this can be considered an unprecedented result in the Finnlines Group.

We are expanding the Finnlines fleet. In 2013, MS Europalink was sold by Finnlines to the parent company because of insufficient volumes in the Baltic at that time. In January 2018, the vessel re-joined Finnlines on the Germany–Sweden route. Slotting the vessel back into the Finnlines rotation will also trigger reshuffling elsewhere in our routes. MS Nordlink, from the Germany–Sweden route will be redeployed on the route between Finland and Sweden, that is, on the Naantali–Långnäs–Kapellskär route. MS Nordlink changed to sail under the Finnish flag and the vessel was renamed MS Finnswan. MS Finnswan will be one of the first ships of this length and with this level of cargo capacity to serve our customers between Finland and Sweden.

DURING THE PAST YEARS, FINNLINES HAS MADE SEVERAL IMPORTANT STRATEGIC DECISIONS and focused on improving its operational and financial performance. During the past decade, we have spent over EUR 1 billion on major fleet renewal, green ship technology, propulsion systems, port technology, IT technology and ERP systems, and we are continuing to invest more through our EUR 70 million Energy Efficiency and Emission Reduction Programme. Under this investment programme, launched in 2017, we will lengthen four of our Breeze series ro-ro vessels, which were built in 2012 and 2013. These vessels will have a capacity increase of 30 per cent, meaning they will be able to carry up to 4,200 lane metres of rolling cargo. The capacity increase of around 1,000 lane metres will also considerably reduce the energy consumption per transported unit compared to the original vessel. As a result, we have been able to sharply reduce emissions per transported tonne. Two vessels have already been lengthened successfully and the remaining two will be completed by the end of April.

ONE TOPIC IN OUR STRATEGIC DISCUSSION IS DIGITALISATION. We continue to invest in digitalisation and it is already very present in our operations. We are increasing the efficiency and effectiveness of our processes and during 2017 we have implemented two major ERP systems; one in the port and the other one is related to vessel efficiency monitoring and measurement. We have also developed mobile services in our port operations to better serve our customers. By digitising and automating processes costs have been cut by more than 30 per cent, meaning savings of several million euros. In addition, information is more accurate, of higher quality, and transferred quicker to various recipients. We will further develop our services to create competitive advantages through digitalisation.

SHIPPING TRANSPORTS TODAY COVER AROUND 90 PER CENT OF GLOBAL COMMERCE, but account only for around 2.2 per cent of C02 emissions. This low percentage alone speaks for itself how environmentally friendly the shipping sector is globally.

IN THE INTERNATIONAL MARITIME ORGANIZATION (IMO), REGULATORS AND THE INDUSTRY ARE DISCUSSING ways to achieve big cuts to CO2 emissions over the coming decades – possibly as much as 40 per cent. This will be our contribution to the wellbeing of generations that follow us.  Moreover, the International Chamber of Shipping (ICS), the London-based leading international association of the shipping industry which represents over 80 per cent of the world fleet, believes it is time for IMO to step up to the plate and contribute more to the fight against global warming in order to match the ambitions laid down in the Paris Agreement and by the EU.

EVEN THOUGH THE WORLD’S SHIPPING SECTOR REPRESENTS ONLY AROUND 2.2 PER CENT OF THE TOTAL GLOBAL CO2 EMISSIONS, yet, the ICS’s goal is to reduce the shipping sector’s annual total CO2 emissions below 2008 levels. In fact, the ambitious goal is to reduce them, on a tonne/kilometre basis, by at least 50 per cent by 2050, compared to 2008.

WE NEED TO LOOK AHEAD TO THE NEXT DECADE AFTER 2020. We are in great shape and well prepared to be one step ahead of our competitors. We base our decisions on our own strategy and in the megatrends we see in the world: a modern fleet, lengthenings, green new buildings, batteries, environmental responsibility, maritime safety, fuel efficiency, digitalisation and automation, will determine which players survive, and which thrive, in the markets of tomorrow. Being a forerunner in our sector, we are well positioned to respond to the need for energy-efficient, environmentally safe and technologically advanced solutions. In the last three years for example Finnlines increased cargo units transported by 11 per cent, cars transported by 48 per cent and passenger transported by 10 per cent. The increased service was delivered without increasing fuel consumption but even diminishing it by 2 per cent, and reducing SOx emissions by ten times. 

IN RESPONSE TO GROWING VOLUMES AND MARKET DEMAND, FINNLINES CONTINUES TO INVEST HEAVILY IN ITS FLEET and has signed a letter of intent for three new 7,300 lane metre ro-ro vessels. Looking to 2018 and a decade beyond, there have always been three key elements strictly connected in the way we are running our shipping business, worldwide in the Grimaldi Group, and also in Finnlines, that is – to grow together with customers, to increase efficiency of capital employed on our fleet and to continue investing in sustainable development.

I WOULD LIKE TO TAKE THIS OPPORTUNITY TO THANK OUR CUSTOMERS AND OUR MANY STAKEHOLDERS FOR YOUR CONFIDENCE IN FINNLINES, and our personnel onboard, in ports and in offices for carrying out the work which has made us the market leader in our sector. Continued joint effort, working as a Finnlines team, made the 2017 financial year the best ever and was a truly remarkable achievement by us all.

Emanuele Grimaldi