AS Tallinna Sadam financial results for 2020 Q2 and 6 months
The impact of the COVID-19 pandemic was greatest in the second quarter of 2020, which resulted in a decrease in revenue, adjusted EBITDA and profit of AS Tallinna Sadam (hereafter: “the Group”). In Q2 2020, the revenue amounted to EUR 22.4 million decreasing by 31.8% compared to the same period previous year. The adjusted EBITDA was EUR 10.2 million decreasing by 45.7%. The loss in Q2 amounted to EUR 831 thousand.
The results of Q2 were mostly affected by the restrictions on passenger movement due to the corona pandemic. The restrictions mainly affected the Passenger harbours segment, as the number of passengers as well as passenger vessel calls decreased significantly due to cross-border traffic restrictions. Also, there were no cruise ship calls in the second quarter. According to Valdo Kalm, Chairman of the Management Board, COVID-19 had no effect on the revenue of Cargo harbours, as the volume of liquid bulk increased in the first half of the year, compensating for the decrease in dry bulk and container cargo. “Because of lower operating volumes and revenue, primarily related to passengers, we also reduced operating expenses, but due to a large share of fixed costs, the cut in operating expenses was not comparable in size to the decline in revenue, therefore the profitability decreased. However, due to the diversification of business areas, we were able to mitigate the impact of the crisis on the Group's financial results, and the negative impact of the second quarter was offset by the strong result of the first quarter, which resulted in a profit of more than EUR 9 million for the first half of the year,” stated Kalm. Kalm considers it substantial that even in a difficult economic environment, the company was able to adhere to the dividend policy and pay dividends of EUR 30.2 million and continue with ongoing investments.
Tallinna Sadam will present the financial results of the Group at a webinar on 14 August at 11:00, to attend, please register . The webinar will be held in English.
Key figures (in million EUR):
| Q2 | Q2 | +/- | 6M | 6M | +/- | |
| 2020 | 2019 | 2020 | 2019 | |||
| Revenue | 22.4 | 32.8 | -31.8% | 50.3 | 61.4 | -18.0% |
| Adjusted EBITDA | 10.2 | 18.8 | -45.7% | 26.4 | 35.7 | -26.1% |
| Adjusted EBITDA margin | 45.6% | 57,4% | -11.8 | 52.5% | 58.2% | -5.7 |
| Operating profit | 4.6 | 13.3 | -65.4% | 15.1 | 24.7 | -38.9% |
| Income tax | -4.9 | -5.8 | -14.8% | -4.9 | -5.8 | -14.8% |
| Profit for the period | -0.8 | 7.2 | -111.6% | 9.2 | 18.2 | -49.7% |
| Investments | 8.6 | 7.1 | 21.1% | 17.4 | 11.1 | 57.0% |
| 30.06.2020 | 31.12.2019 | +/- | |
| Total assets | 640,7 | 625,5 | 2,4% |
| Interest bearing debt | 160,1 | 172,7 | -7,3% |
| Other liabilities | 356,0 | 377,0 | -5,6% |
| Equity | 263,0 | 263,0 | 0,0% |
| Number of shares | 640,7 | 625,5 | 2,4% |
Revenue
Revenue for the first six months of 2020 decreased by EUR 11.1 million, i.e. 18%. The decrease occurred almost entirely in Q2 mainly influenced by the decline in revenues from ferries and cruise ships due to restrictions on cross-border passenger movements imposed in connection with the COVID-19 pandemic. Revenues increased only from the icebreaker Botnica's charter fee through the indexation of contractual fees and a slightly earlier start of the summer work. In both Q2 and the first half of the year, revenue increased in the segment Other, but decreased in the segments of Passenger harbours, Cargo harbours and Ferry.
The revenue of the Cargo harbours segment was not significantly affected by the restrictions related to the COVID-19 pandemic. Revenue declined because the ferries operating on the Muuga-Vuosaari route were temporarily rerouted to the Old City Harbour (Passenger harbours segment). In the first half of the year, revenue decreased by 6% due to the combined effect of various items of revenue, mostly because the volume of electricity sold (as an agent) and cargo charge revenue decreased. Cargo charge revenue declined due to the combined effect of an increase in the volume of liquid bulk cargo whose cargo charges are lower and a decrease in the volumes of other cargo types.
The revenue of the Ferry segment decreased slightly because the Estonian state did not order an additional vessel for extra trips during the summer season. Instead, the additional trips are made by an existing replacement ferry Regula. The decline was partly offset by a rise in fee rates, which are linked to the Estonian consumer and fuel price indices and wage inflation.
The revenue of the segment Other increased through the indexation of the contractual fees of the icebreaker Botnica to the Estonian and Canadian consumer price indices and a slightly earlier start of the work in Canadian waters during the summer season.
EBITDA
Adjusted EBITDA for Q2 decreased by EUR 8.6 million year-on-year mostly due to the Passenger harbours segment (EUR 7.9 million) but also in the Cargo harbours segment (EUR 0.6 million). Adjusted EBITDA margin decreased from 58.2% to 52.5% in 6 months influenced by the result of Q2, when the margin decreased from 57.4% to 45.6%. In 6 months, adjusted EBITDA was 26.4 million euros, decreasing by EUR 9.3 million compared to the same period last year.
Profit
In the second quarter of 2020, the Group declared a dividend of EUR 30.2 million and related income tax expense amounted to EUR 4.91 million, EUR 0.85 million less than in the previous year. The result for Q2 (a loss of EUR 0.8 million) fell short of the profit for the comparative period by EUR 8.0 million. Profit for the first six months was EUR 9.2 million, which was EUR 9 million less year-on-year.
Investments
In the first six months of 2020, the Group invested EUR 17.4 million, significantly more than in the same period last year (EUR 11.1 million). Investments were mostly related to phase 2 of the reconstruction of passenger terminal D at the Old City Harbour, the start of the construction of a cruise terminal and dredging works at the Paldiski South Harbour. Investments of the second quarter totaled EUR 8.6 million.
Interim condensed consolidated statement of financial position:
| In thousands of euros | 30.06.2020 | 31.12.2019 |
| ASSETS | ||
| Current assets | ||
| Cash and cash equivalents | 44,331 | 35,183 |
| Trade and other receivables | 11,243 | 10,614 |
| Contract assets | 353 | 0 |
| Inventories | 297 | 408 |
| Non-current assets held for sale | 98 | 142 |
| Total current assets | 56,322 | 46,347 |
| Non-current assets | ||
| Investments in associates | 1,349 | 1,609 |
| Other long-term receivables | 259 | 294 |
| Property, plant and equipment | 580,707 | 575,267 |
| Intangible assets | 2,025 | 2,015 |
| Total non-current assets | 584,340 | 579,185 |
| Total assets | 640,662 | 625,532 |
| LIABILITIES | ||
| Current liabilities | ||
| Loans and borrowings | 16,266 | 16,266 |
| Derivative financial instruments | 173 | 243 |
| Payables to owners | 30,245 | 0 |
| Provisions | 1,035 | 1,915 |
| Government grants | 1,794 | 193 |
| Taxes payable | 715 | 893 |
| Trade and other payables | 16,612 | 11,722 |
| Contract liabilities | 3,482 | 33 |
| Total current liabilities | 70,322 | 31,265 |
| Non-current liabilities | ||
| Loans and borrowings | 188,197 | 191,580 |
| Government grants | 25,219 | 24,754 |
| Other payables | 16 | 2 |
| Contract liabilities | 914 | 913 |
| Total non-current liabilities | 214,346 | 217,249 |
| Total liabilities | 284,668 | 248,514 |
| EQUITY | ||
| Share capital at par value | 263,000 | 263,000 |
| Share premium | 44,478 | 44,478 |
| Statutory capital reserve | 20,262 | 18,520 |
| Hedge reserve | -173 | -243 |
| Retained earnings (prior periods) | 19,276 | 6,859 |
| Profit for the period | 9,151 | 44,404 |
| Total equity | 355,994 | 377,018 |
| Total liabilities and equity | 640,662 | 625,532 |
Interim condensed consolidated statement of profit or loss:
| In thousands of euros | Q2 2020 | Q2 2019 | 6M 2020 | 6M 2019 |
| Revenue | 22,399 | 32,822 | 50,289 | 61,350 |
| Other income | 219 | 305 | 1,980 | 580 |
| Operating expenses | -7,210 | -9,319 | -15,537 | -16,717 |
| Personnel expenses | -4,807 | -4,817 | -9,484 | -9,108 |
| Depreciation, amortisation and impairment | -5,924 | -5,643 | -11,912 | -11,193 |
| Other expenses | -79 | -75 | -213 | -181 |
| Operating profit | 4,598 | 13,273 | 15,113 | 24,731 |
| Finance income and costs | ||||
| Finance income | 13 | 14 | 24 | 27 |
| Finance costs | -427 | -443 | -814 | -881 |
| Finance costs - net | -414 | -429 | -790 | -854 |
| Share of profit of an associate accounted for under the equity method | -102 | 81 | -259 | 86 |
| Profit before income tax | 4,082 | 12,925 | 14,064 | 23,963 |
| Income tax | -4,913 | -5,764 | -4,913 | -5,764 |
| Profit/loss for the period | -831 | 7,161 | 9,151 | 18,199 |
| Attributable to owners of the Parent | -831 | 7,161 | 9,151 | 18,199 |
| Basic and diluted earnings per share (in euros) | 0.00 | 0.03 | 0.03 | 0.07 |
| Basic and diluted earnings per share - continuing operations (in euros) | 0.00 | 0.03 | 0.03 | 0.07 |
Interim condensed consolidated statement of cash flows:
| In thousands of euros | 6M 2020 | 6M 2019 |
| Cash receipts from sale of goods and services | 55,328 | 65,769 |
| Cash receipts related to other income | 21 | 151 |
| Payments to suppliers | -20,587 | -20,480 |
| Payments to and on behalf of employees | -7,956 | -8,791 |
| Payments for other expenses | -196 | -216 |
| Income tax paid on dividends | 0 | -4,949 |
| Cash from operating activities | 26,610 | 31,484 |
| Purchases of property, plant and equipment | -16,162 | -9,975 |
| Purchases of intangible assets | -272 | -233 |
| Proceeds from sale of property, plant and equipment | 1,101 | 24 |
| Government grants received | 2,061 | 0 |
| Interest received | 15 | 25 |
| Cash used in investing activities | -13,257 | -10,159 |
| Repayments of loans received | -3,373 | -3,383 |
| Dividends paid | 0 | -34,970 |
| Interest paid | -816 | -887 |
| Other payments related to financing activities | -6 | -10 |
| Cash from/used in financing activities | -4,205 | -39,250 |
| NET CASH FLOW | 9,148 | -17,925 |
| Cash and cash equivalents at beginning of the period | 35,183 | 42,563 |
| Change in cash and cash equivalents | 9,148 | -17,925 |
| Cash and cash equivalents at end of the period | 44,331 | 24,638 |
Tallinna Sadam is one of the largest cargo- and passenger port complexes in the Baltic Sea region, which in 2019 serviced 10.64 million passengers and 19.9 million tons of cargo. In addition to passenger and freight services, Tallinna Sadam group also operates in shipping business via its subsidiaries – OÜ TS Laevad provides ferry services between the Estonian mainland and the largest islands, and OÜ TS Shipping charters its multifunctional vessel Botnica for icebreaking and construction services in Estonia and offshore projects abroad. Tallinna Sadam group is also a shareholder of an associate AS Green Marine, which provides waste management services. According to audited financial results, Tallinna Sadam group’s sales in 2019 totaled EUR 130.5 million, adjusted EBITDA EUR 74.3 million and net profit EUR 44.4 million.
Additional information:
Marju Zirel
Head of Investor Relations
AS Tallinna Sadam
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