Tallink Grupp reports drops in revenue and transport volumes in 2024
In the financial year 2024 (January 1 to December 31), Estonian transport company Tallink Grupp and its subsidiaries carried 5,580,016 passengers, which is 2.2 per cent less than in the financial year 2023.
The number of cargo units transported decreased by 6.4 per cent compared to the previous year amounting to 303,234. The number of passenger vehicles was down by 7.5 per cent year-on-year and amounted to 777,592.
The group’s unaudited consolidated revenue amounted to €785.8 million (US$823 million) (€835.3 million in the financial year 2023), down by €49.5 million (US$51.8 million) 5.9 per cent year-on-year.
Unaudited EBITDA was €175.2 million (US$183.5 million) (€214.5 million in the financial year 2023) and the unaudited net profit for the period was €40.3 million (US$42.2 million) (€78.9 million in the financial year 2023).
The following operational factors impacted the group’s revenue and operating results in the financial year 2024:
Demand continued to be affected by low consumer and business confidence levels, the economic challenges in the group’s core markets and global geopolitical tensions.
As at the end of the financial year, the group operated 14 vessels including two shuttle vessels, two cargo vessels, five operating cruise ferries, three vessels that were chartered out (four at the beginning of the year) and two vessels that were in lay-up.
The group extended the charter agreement of the cruise ferry Galaxy I until October 2025 with the extension option of 6+6 months and signed an agreement for chartering of the cruise ferry Silja Europa until June 2025 with the extension option of 7+6+6 months at the end of the agreement term.
The group sold the cruise ferry Isabelle in January 2024.
The group’s net debt was €537.7 million (US$563.1 million) as at the end of the financial year (€555.7 million as at 30 September 2024) bringing the net debt to EBITDA ratio to 3.07 as at December 31, 2024.
In the financial year 2024, total loan repayment and related interest expense amounted to €116.1 million (US$121.6 million).
Payment of dividends in the amount of €44.6 million (US$46.71 million) and related income tax expense in the amount of €9.2 million (US$9.6 million).
As a result of the voluntary takeover bid, the shareholding of Infortar, the core shareholder of the group, increased from 46.8 per cent to 68.5 per cent as at August 9, 2024. Tallink Grupp continues as an independent listed company also after Infortar become the majority shareholder of the group.
The group continues to focus on cost efficiencies from the previously implemented measures and maintaining profitable operations on its core routes.
The group regularly monitors the developments on its core routes including the capacity of each route and continues to look for new chartering options for vessels not used on the main routes and to work on extending the existing chartering agreements.
Sales and earnings
Revenue from route operations (the group’s core business) decreased by €6.9 million (US$7.2 million) to €638.9 million (US$669.1 million) compared to the financial year 2023. The segment result from route operations (the group’s core business) amounted to €81.5 million (US$85.4 million), down by €25.7 million (US$26.9) compared to the financial year 2023.
In the financial year 2024, the group’s gross profit declined by €50.3 million (US$52.7 million) to €153.6 million (US$160.9 million) compared to €203.8 million (US$213.4 million) in the financial year 2023. EBITDA declined by €39.3 million (US$41.2 million) and amounted to €175.2 million (US$183.5 milllion).
The group’s unaudited net profit for the financial year 2024 was €40.3 million (US$42.2 million) or €0.054 per share compared to €78.9 million (US$82.6 million) or €0.106 per share in the financial year 2023.
Financial position
As at December 31, 2024, the group’s cash and cash equivalents amounted to €18.7 million (US$19.6 million) and the group had €75 million (US$79 million) in unused credit lines. The total liquidity buffer (cash, cash equivalents and unused credit facilities) amounted to €93.7 million (US$98.1 million).
The decline in cash and cash equivalents in the financial year 2024 was driven by the payment of dividends and related income tax as well as the repayment of loans and related interest expense. In the financial year 2023, the net repayment of loans amounted to €189.6 million (US$198.6 million).
Results of Q4 2024
In the fourth quarter of 2024 (October 1 to December 31), the group carried 1.3 million passengers, which is down by 2.2 per cent compared to the same period last year.
The group’s unaudited revenue for the period decreased by 5.3 per cent and amounted to €183.5 million (US$192.2 million). Unaudited EBITDA was €25.7 million (US$26.9 million) and unaudited net loss was €5.2 million (US$5.5 million).
The financial results of Q4 2024 were impacted by the following factors:
Low consumer and business confidence in the home markets and geopolitical tensions
Two vessels in lay-up including the cruise vessel Romantika, the charter agreement of which was prematurely terminated in September 2023 and Superfast IX (formerly Atlantic Vision) the charter agreement of which ended in May 2024. The group has not been able to find profitable operations for both vessels in lay-up.
Repayment of long-term loans and related interest expenses in the amount of €34.5 million (US$36.1 million).
In October 2024, the charter agreement of the cruise ferry Galaxy I was extended by 12 months until October 2025 with the option of extending the agreement at the end of the agreement period by another 6+6 months.
