Financial Statements 2020 and Financial Review January–December 2020
Finnlines invests EUR 0.5 billion in green vessels and for long-term growth – safeguarding national emergency supply with emission-free technology
EMANUELE GRIMALDI, PRESIDENT AND CEO, IN CONJUNCTION WITH THE REVIEW
“Finnlines Group’s turnover was EUR 484.0 (574.8) million in the reporting period, a decrease of 16% compared to the same period in the previous year. The EUR 91.0 million turnover reduction against last year consisted of a sharp passenger revenue loss due to the corona pandemic of EUR 21.4 million, and a freight turnover loss of EUR 70 million. Quite importantly, EUR 47 million of the said freight turnover reduction stemmed from a reduction of bunker surcharges asked from clients during pandemic. The bunker surcharge reductions awarded from Finnlines to clients as from March 2020 were far beyond what was awarded from Finnlines to clients during the previous years, and also far beyond what was awarded from Finnlines competitors to clients in the same period. We are proud to state that this policy resulted in a net saving for clients in one of the toughest period for Finnish economy, and it has been made possible thanks to the logistic efficiencies made by our Group.
Result before interest, taxes, depreciation and amortisation (EBITDA) was EUR 140.8 (169.8) million, a decrease of 17%. At the end of the first quarter, Finnlines reacted promptly to the first signs of the widespread economic fallout of the ongoing crisis and initiated a cost saving plan to mitigate the Covid-19 impact. We were not, of course, immune, but our flexibility and agility, which are based on an in-depth industry knowledge, allowed us to successfully implement the cost saving plans. As a result, we maintained a feasible profitability throughout the latter part of the year and the result for the reporting period was EUR 69.7 (98.3) million, which we are very proud of. Finnlines alone transports more than a third of the one million rubber-tyred units, i.e. trucks and trailers, which move annually across Finland’s three main sea bridges, Finland–Sweden, Finland–Germany and Finland–Estonia. Finnlines is a critical player in transporting medicines, foodstuffs and other commodities to Finland. Furthermore, Finnlines is an important carrier of industrial products, spare parts, machinery and equipment. As an example, Finnlines’ Naantali–Långnäs–Kapellskär route is the most important western maritime route in safeguarding the security of supplies for Finland. Finnlines is the market leader in maritime transport between Finland and Sweden.
In 2020, we reached an important milestone in our EUR 0.5 billion green newbuilding programme. All three ultra green hybrid ro-ro vessels are now undergoing different construction stages and the investment programme continues as planned, on schedule and as budgeted. The vessels will be built with the latest technology available to ensure the lowest carbon dioxide and other emissions. In addition, lithium-ion battery systems will allow zero-emissions at port. Deliveries of all three recently named vessels in the series, Finneco I, Finneco II and Finneco III, are expected between November 2021 and April 2022. In addition to these three ro-ro vessels, we have also ordered two eco-efficient Superstar ro-pax vessels, which are scheduled to start operating in 2023. Superstar ro-pax vessels will bring new innovative solutions to our services and the environmental perspective is taken into account everywhere. The new ships will have a full intake up to 5,100 lane metres and 1,100 passengers.
Regardless of our pivotal supply role, green and sustainable leadership and despite Finnlines’ turnover and profitability have also declined due to economic slowdown, we were not made part of any of the EUR 70 million maritime public financial aid distributed to other shipping companies during the Covid-19 pandemic. On the contrary, we found ourselves to compete in a very tough period, with a lot of sustainable investments ongoing, against competitors operating on the same routes, with same type of services, but without enjoying at all their subsidies. This of course cause to Finnlines harm and difficulties. Furthermore, this has proved to be inequal, distortive of market rules and against the EU market laws. We therefore still dare to suggest a more equal, horizontal, green and proportional distribution of public aids.
Looking into 2021, regular high frequency traffic between Finland and the rest of Europe will continue to be the foundation of Finnlines’ operations as well as continued investments in sustainability. By constantly renewing and developing the fleet for our customers, using the latest technology and innovations, we can proudly say that we are Finland’s premier seafreight operator.”
For further information, please contact
Chief Financial Officer
phone +358 40 519 5041
Finnlines is a leading shipping operator of ro-ro and passenger services in the Baltic Sea, the North Sea and the Bay of Biscay. The Company is a part of the Grimaldi Group, one of the world’s largest operators of ro-ro vessels and the largest operator of the Motorways of the Sea in Europe for both passengers and freight. This affiliation enables Finnlines to offer liner services to and from any destination in the Mediterranean, West Africa as well as the Atlantic coast of both North and South America.