Attica reduces its annual loss
Strong operating results have not been enough to pull one of Greece's big ferry owners out of the red. But the Attica Group is hoping the reduction in losses is a sign that several years of losses are coming to an end.
Attica, which includes the fleets of Superfast Ferries and Blue Star Ferries, saw an increase in 2013 revenues and reported earnings of two million Euro (US$2.75 million) before interest, taxes, investing and financial results, reporting a positive EBIT for the first time since 2009.
The owner of 13 Ro-Pax vessels sailing on Greece-Italy routes in the Adriatic Sea and in the Greek domestic market, posted a net loss of 10.1 million Euro (US$13.9 million), down from 54 million Euro (US$74.2 million) in 2012 when the result was burdened with 20.4 million Euro (US$28 million) in impairments on ship values and extraordinary capital losses of 6.4 million Euro (US$8.8 million).
The ferry operator said the results were helped by a reduction in fuel oil prices, which, together with more efficient deployment of the fleet, reduced its fuel and lubricants costs by almost ten per cent. The sale of the 'Superfast VI' in March 2013 and the launch of the Piraeus-Chios-Mytilene route with the new building Ro-Pax vessel 'Blue Star Patmos' in July 2012 were of interest, comparing 2013 revenues and results with previous year figures.
In its end of year report the company said the improved figures were achieved within a "continuing adverse financial environment" that had hurt passenger shipping.
Attica claims it boosted its share of the market last year by two per cent to 35.2 per cent for passengers, although its market share in truck traffic slipped a percentage point to 35.7 per cent. On domestic routes it increased its passenger volumes by over five per cent and freight units by over four.
The ongoing economic recession of the Greek economy, the continuing intense competition within the ferry sector, the development of tourism (especially domestic tourism during the summer months) and fuel prices are the most important factors that will affect 2014 performance.
The company has been in lengthy talks with bankers to try to agree a mutually agreed restructuring plan. Attica is assessing plans to increase turnover, looking at new routes and at "alternative fleet deployment combinations".
French ferries in the news
Well it's certainly all happening in France at the moment, and as one might expect from the land of strikes and blockades, the French aren't giving up without a fight.
Eurotunnel and its affiliate, MyFerryLink, is bristling at the news that the United Kingdom government's Competition Commission has provisionally ruled that it has the power to ban the Channel Tunnel operator from running ferries between Dover and Calais.
The French shuttle giant has described the decision as "incomprehensible", while MyFerryLink fears a "vendetta" and describes the Competition Commission's latest ruling as "baffling".
Eurotunnel bought three ships from SeaFrance after it went bust. They were used for Eurotunnel's MyFerryLink, which began operating on the Dover-Calais route in August 2012. The company challenged the commission's June 2013 ruling that its market share would lead to price rises.
As a result, the Competition Appeal Tribunal said the commission should reconsider. The Competition Commission had been asked to decide if the purchase of the ships by Eurotunnel amounted to a merger under UK rules.
"The decision of the Competition Commission is completely contradictory to that expressed previously by the French competition authorities," said Eurotunnel.
In response, the commission said, "there was a considerable level of continuity between the former SeaFrance services on the Dover-Calais route. The combination of assets… enabled them to establish ferry operations more quickly, more cheaply and with less risk." It also said the ships had been "specifically configured" for the route and were operated by former SeaFrance staff.
But a Eurotunnel spokesman hit back, saying SeaFrance had been liquidated before Eurotunnel had acquired the ferries: "Groupe Eurotunnel cannot understand how it is possible to acquire a company six months after it has ceased to exist and nine months after the closure of all operations," a spokesman said.
"Groupe Eurotunnel emphasises that over the past two years the market has in no way been negatively affected by MyFerryLink," they added.
The Competition Commission is due to make a final ruling in May after inviting comments on whether there had been any "changes in circumstances" since the first decision was made.
Meanwhile, in the south of France, SNCM continues its beleaguered course with news that the Supervisory Board has in fact authorised the Management Board to sign a letter of intent (LOI) to order two LNG ferries, with an option for two more, from STX Saint-Nazaire.
The LOI is subject to financing, a point which will be addressed in a supervisory board meeting by mid-April. What is not yet known is how the ferry operator plans to finance the purchases, with each ship estimated to cost between 150 million and 170 million Euro (US$205-US$233 million).
Last year, the European Commission ordered France to recover 440 million Euro (US$604.6 million) in state aid from the long struggling ferry operator, which has threatened the survival of a business the government is eager to rescue. France has appealed the order.
The French government would certainly be feeling pressure from the CGT union, STX (whose parent company is cash-strapped), and from SNCM itself – 25 per cent of which is owned by the state.
As previously reported, SNCM is partly owned by French water and waste group Veolia Environnement, which has made it clear it will not put new money into SNCM and will not be held liable for repaying the subsidies. Veolia has said it is ready to divest its 66 per cent stake in SNCM for a symbolic price and abandon its claims on SNCM in order to facilitate its recovery.
C'est la vie!
Justin Merrigan
Image Source: C messier/Wikimedia Commons
