LHV Institutional Baltic Insight, August 4th, 2020
* Novaturas AB (hereinafter referred to as ‘Novaturas’ or the ‘Company’), in line with the global tourism sector, was severely hit by the COVID-19 crisis. This knocked the Company’s PAX numbers and thus revenues for Q2 2020. The Company managed to generate meagre revenues of EUR 126k for the quarter, which were mainly generated from flight package tours.However, to respond to the coronavirus crisis, Novaturas managed to haul back its operating expenses in Q2 2020 to limit the impact of the COVID-19 crisis on its operating results. These cost-cutting measures limited the net loss for Q2 2020 at EUR 1.9m, which was c.a. EUR 0.6m better than the bottom end of our estimated forecast range. Please also refer to the table in the attachment.* Following the removal of all travel restrictions between Estonia-Finland from 15th June 2020, Tallink Grupp’s (‘TAL’ or the ‘Group’) traffic numbers between the two countries started to recover in the second half of June. However, the July PAX number for the main route came in somewhat softer than hoped for, indicating a growing probability of the prolonged recovery scenario. Further recovery was also registered in terms of Finland-Sweden PAX flows, but traffic on all other routes remained minimal as the coronavirus situation in Sweden is more complicated compared to Finland and the Baltic states, and travelling to/from Sweden is restricted.
* On the positive side, TAL recorded expanding cargo flows between Estonia-Finland and Finland-Sweden in July 2020 in comparison to the same month a year ago. On a y-o-y basis, in July 2020, TAL’s monthly PAX number fell 50.2% to 617,200, with total passenger cars dropping 23.9% to 118,200. TAL’s total cargo traffic declined just 2.9% y-o-y to 29,100 units. Please also refer to the table in the attachment.
Novaturas AB is a Lithuania-based company, which is engaged in the provision of travel services in the Baltic countries. The Company operates through three divisions: All Inclusive vacation packages around all time year; Sightseeing tour by coach and plane to approximately 30 destinations across the world, as well as ski trips. It also offers airline tickets and hotel accommodations. It sells tours through travel agencies and its Website.
Tallink Grupp AS is a ferry operator providing mini-cruise and passenger transport services in the Baltic Sea region. The Company also offers cargo services on the various routes between Finland-Sweden, Estonia-Finland, Estonia-Sweden, Finland-Germany, and Latvia-Sweden under the brand names of Tallink and Silja Line. In addition, the Group operates four hotels in Tallinn and one in Riga. As of March 28, 2013, the Company's major shareholder was Infortar AS with a stake of 35.81%.
LHV Bank is an independent pan-Baltic bank, based on Estonian capital. The company was founded in 1999 by two founders of Hansapank (today’s Swedbank in the Baltics) and has been offering a full range of investment services for 15 years. In May 2009, LHV received a credit institution licence allowing it to provide all banking services.
The head office is situated in Tallinn, Estonia. Cross-border services are offered in Vilnius, Lithuania and in Riga, Latvia. LHV provides brokerage (institutional and retail), asset management, banking and capital markets services. Compared to other banks, we are more innovative and have more solid experience in investment and entrepreneurship.
The Bank, together with the Group asset management company employs over 320 people. LHV Group shares are listed on Nasdaq Tallinn.
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