AS Tallinna Sadam financial results for 2019 Q4 and 12 months

In 2019, the annual revenue was EUR 130.5 million and adjusted EBITDA amounted to EUR 74.3 million, both decreasing by 0.1% staying to the level of previous year. However, the profit for the year was an all-time record of EUR 44.4 million, exceeding the previous year's profit by EUR 20.0 million due to lower dividend income tax expenses, as in 2018 the Group paid an extraordinarily large amount of dividends of EUR 105 million. According to Valdo Kalm, Chairman of the Management Board, the...

In 2019, the annual revenue was EUR 130.5 million and adjusted EBITDA amounted to EUR 74.3 million, both decreasing by 0.1% staying to the level of previous year. However, the profit for the year was an all-time record of EUR 44.4 million, exceeding the previous year's profit by EUR 20.0 million due to lower dividend income tax expenses, as in 2018 the Group paid an extraordinarily large amount of dividends of EUR 105 million.

According to Valdo Kalm, Chairman of the Management Board, the year 2019 was another eventful year for Tallinna Sadam and the divergent changes also influenced the financial results of the Group, which ultimately reached a high level of successful year 2018 and, thanks to a strong Q4, also achieved an all-time record in annual profit. “Passenger record, the rapid development of the Muuga-Vuosaari line, the increase in dry bulk volumes supported by a good grain season, the longer summer work period of the icebreaker Botnica in northern Canada and the revenue from the trips of the additional ferry on the Saaremaa route in summer contributed significantly to the annual results. On the other hand, the results were pressured by fluctuations and general drop in liquid cargo volumes and regular docking of several passenger vessels at the beginning of the year,” Kalm explained.

According to Valdo Kalm, Chairman of the Management Board, the increase in the Group's revenue in Q4 as well as during the year was mainly influenced by the work of multifunctional icebreaker Botnica as an escort and ice management vessel in the northern part of Canada from June to November; and the growth of liquid cargo volumes and revenues. “The revenue from the trips of the additional ferry on the Saaremaa route in summer also contributed significantly to the annual results,” Kalm explained.

Tallinna Sadam will present the financial results of the Group at a webinar on 28 February at 11:00 EET, to attend, please register here. The webinar will be held in English.

Key figures (in million EUR):

	Q4	Q4	+/-	2019	2018	+/-
	2019	2018
Revenue	30.0	29.6	1.5%	130.5	130.6	-0.1%
Adjusted EBITDA	14.8	14.7	1.1%	74.3	74.4	-0.1%
Adjusted EBITDA margin	49.5%	49.7%	-0.2	56.9%	56.9%	0.0
Operating profit	9.1	9.0	0.8%	51.7	52.1	-0.8%
Income tax	0.0	0.1	-100.0%	-5.8	-26.2	-78.0%
Profit for the period	8.5	8.6	-1.7%	44.4	24.4	81.8%
Investments	10.7	6.1	74.2%	29.5	14.3	106.9%

	31.12.2019	31.12.2018	+/-
Total assets	625.5	623.6	0.3%
Interest bearing debt	207.8	213.6	-2.7%
Other liabilities	40.7	42.4	-4.0%
Equity	377.0	367.7	2.5%
Number of shares	263.0	263.0	0.0%

Revenue
Revenue for Q4 of 2019 grew by EUR 0.4 million, i.e. 1.5%, year on year but annual revenue decreased by EUR 0.1 million, i.e. 0.1%, to EUR 130.5 million. In 2019, in terms of segments, the most significant annual revenue change was in the Cargo harbours segment where revenue declined by EUR 1.6 million, i.e. 3.8%, attributable to a decline in the volume of liquid bulk cargo, which on the other hand was offset by the increase in dry bulk volumes and the addition of a new vessel to the Muuga-Vuosaari line in the second half of the year.
The revenue of the Passenger harbours segment remained at the same level as in 2018 due to increase in line- and cruise passenger volumes and despite of the regular dry docking of several passenger ships at the beginning of the year.
The revenue of the Ferry segment grew, mainly due to changes in the contractual fee rates, which are linked to the Estonian consumer and fuel price indices and wage inflation.
The revenue of the segment Other increased, mostly due to longer charter period during the summer season and the indexation of the ice-breaking and charter fees to the inflation index, regarding both winter and summer period works.

EBITDA
Adjusted EBITDA for Q4 grew by EUR 0.2 million, i.e. 1.1% year on year. The annual adjusted EBITDA remained at the level of 2018, decreasing by EUR 0.1 million to EUR 74.3 million, i.e. by 0.1%. The adjusted EBITDA margin remained stable at 56.9%.

Profit
Due to lower income tax expense, profit for 2019 reached an all-time high of EUR 44.4 million, exceeding profit for 2018 by EUR 20.0 million. Net profit for Q4 amounted to EUR 8.5 million.
Profit before tax decreased by EUR 0.5 million, i.e. 0.9%, to EUR 50.2 million in 2019. Profit before tax for the fourth quarter decreased by EUR 0.1 million year on year. Income tax expense decreased by EUR 20.4 million because in 2018 the Group declared a record dividend of EUR 105 million compared with EUR 35.2 million in 2019.

Investments
In Q4, capital investments totalled EUR 10.7 million. In 2019, the Group's capital investments totalled EUR 29.5 million. This is more than twice the amount invested in 2018, when investments amounted to EUR 14.3 million. Investments of 2019 were mainly related to the Old City Harbour, where work continued on the reconstruction of passenger terminal D and the installation of on-shore power supply systems for passenger ships, and the Group co-financed the construction of the road Reidi tee. Dredging works were carried out in the approach canal and waters of the Paldiski South Harbour, quays and supplier routes were reconstructed at Muuga harbour, machinery and technical systems were renewed on board of the icebreaker Botnica, and scheduled dry docking work was done and service areas were rebuilt on the ferries.

Interim condensed consolidated statement of financial position:

In thousands of euros	31 December 2019	31 December 2018
ASSETS
Current assets
Cash and cash equivalents	35,183	42,563
Trade and other receivables	10,614	8,017
Inventories	408	305
Non-current assets held for sale	142	0
Total current assets	46,347	50,885
Non-current assets
Investments in associates	1,609	1,569
Other long-term receivables	294	196
Property, plant and equipment	575,267	568,965
Intangible assets	2,015	2,024
Total non-current assets	579,185	572,754
Total assets	625,532	623,639
LIABILITIES
Current liabilities
Loans and borrowings	16,266	15,766
Derivative financial instruments	243	425
Provisions	1,915	1,957
Government grants	193	174
Taxes payable	893	5,844
Trade and other payables	11,755	9,517
Total current liabilities	31,265	33,683
Non-current liabilities
Loans and borrowings	191,580	197,846
Government grants	24,754	23,418
Other payables	915	1,018
Total non-current liabilities	217,249	222,282
Total liabilities	248,514	255,965
EQUITY
Share capital at par value	263,000	263,000
Share premium	44,478	44,478
Statutory capital reserve	18,520	18,520
Hedge reserve	-243	-425
Retained earnings (prior periods)	6,859	17,678
Profit for the period	44,404	24,423
Total equity	377,018	367,674
Total liabilities and equity	625,532	623,639

Interim condensed consolidated statement of profit or loss:

In thousands of euros	Q4 2019	Q4 2018	2019	2018
Revenue	30,005	29,572	130,536	130,635
Other income	229	158	1,017	816
Operating expenses	-9,212	-9,347	-36,669	-37,360
Personnel expenses	-5,740	-5,508	-19,867	-19,420
Depreciation, amortisation and impairment	-6,125	-5,829	-23,037	-22,345
Other expenses	-77	-34	-301	-251
Operating profit	9,080	9,012	51,679	52,075
Finance income and costs
Finance income	13	20	42	33
Finance costs	-463	-464	-1,797	-2,003
Finance costs - net	-450	-444	-1,755	-1,970
Share of profit of an associate accounted for under the equity method	-173	-18	244	517
Profit before income tax	8,457	8,550	50,168	50,622
Income tax	0	51	-5,764	-26,199
Profit for the period	8,457	8,601	44,404	24,423
Attributable to owners of the Parent	8,457	8,601	44,404	24,423
Basic and diluted earnings per share (in euros)	0.03	0.03	0.17	0.11
Basic and diluted earnings per share - continuing operations (in euros)	0.03	0.03	0.17	0.11

Interim condensed consolidated statement of cash flows:

In thousands of euros	2019	2018
Cash receipts from sale of goods and services	138,690	138,746
Cash receipts related to other income	193	104
Other receipts	0	2,600
Payments to suppliers	-47,210	-46,260
Payments to and on behalf of employees	-16 892	-16,461
Payments for other expenses	-377	-366
Income tax paid on dividends	-10,985	-21,250
Cash from operating activities	63,419	57,113
Purchases of property, plant and equipment	-27,965	-11,941
Purchases of intangible assets	-550	-618
Proceeds from sale of property, plant and equipment	39	12
Dividends received	204	204
Interest received	28	18
Cash used in investing activities	-28,244	-12,325
Contributions to share capital	0	119,883
Redemption of debt securities	-9,000	-12,650
Loans received	10,000	0
Repayments of loans received	-6,766	-6,766
Change in overdraft (liability)	0	-2,565
Repayments of finance lease principal	0	-7
Dividends paid	-34,970	-105,000
Interest paid	-1,769	-2,023
Other payments related to financing activities	-50	-51
Cash from/used in financing activities	-42,555	-9,179
NET CASH FLOW	-7,380	35,609
Cash and cash equivalents at beginning of the period	42,563	6,954
Change in cash and cash equivalents	-7,380	35,609
Cash and cash equivalents at end of the period	35,183	42,563

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. Tallinna Sadam group's sales in 2019 totalled 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
[email protected]

Attachment

• Tallinna Sadam Q4 2019 ENG