Tallinna Sadam earned 31 million euros in revenue and 6 million euros in profit in the third quarter. The nine-month revenue was 89 million euros and the profit reached 13 million euros. In the third quarter, the volume of investments increased to nearly 5 million euros, since the beginning of the year we invested a total of 11 million euros.
In the third quarter, both revenue (-14%), adjusted EBITDA (-25%) and profit (-49%) decreased year-on-year. Operating expenses in the third quarter decreased mainly due to the drop in energy prices. In the 9 months total, the revenue decreased by 5%, and due to the pressure of cost growth, adjusted EBITDA (-17%) and profit (-46%) fell.
Nine months in total, the number of passengers increased by 15%, but there were fewer passenger ship calls. Compared to the previous year, fewer cruise ships visited our harbours, although the occupancy of the ships was significantly higher. The decrease in cargo volumes continued due to sanctions and the general decrease in freight volumes, which led to a decrease in revenue and adjusted EBITDA. In shipping, both ferries and the icebreaker Botnica showed growth, but regular dock work and costs related to the new charter contracts affected Botnica's profitability. As a result of wage pressure and the rise in Euribor interest rates, personnel costs and financial costs increased the most on the cost side.
Valdo Kalm, chairman of the management board of Tallinna Sadam, states that times are difficult, and we have moved from one crisis to another, but the company continues to make a decent profit. The various business areas balance each other, making the group as a whole resistant to the risks of the external environment, which is why we are ready to pay dividends next year as well and simultaneously continue with investments. "At the moment, there is a strong focus on cost savings and on the development and launch of new growth projects, such as the construction of the Paldiski offshore wind farm quay and the cost-benefit analysis of the maintenance fleet and the start of operation of the Pakrineeme harbor LNG quay," said Kalm.
The management board of Tallinna Sadama will present the group's financial results in webinars on 10 November, including a webinar in Estonian at 10:00 a.m. (EET) (link to EST webinar) and a webinar in English at 11:00 a.m. (EET) (link to ENG webinar).
Key figures (million EUR):
| Q3 | Q3 | +/- | 9M | 9M | +/- | |
| 2023 | 2022 | % | 2023 | 2022 | % | |
| Revenue | 31.4 | 36.3 | -13.5 | 88.6 | 93.5 | -5.2 |
| Adjusted EBITDA | 13.5 | 18.0 | -24.9 | 38.8 | 46.9 | -17.2 |
| Adjusted EBITDA margin | 43.0% | 49.6% | -6.6 | 43.8% | 50.2% | -6.4 |
| Operating profit | 7.4 | 11.8 | - 37.1 | 20.0 | 28.2 | -29.0 |
| Income tax | 0 | 0 | - | -3.0 | -4.1 | -27.4 |
| Profit for the period | 6.0 | 11.7 | -49.1 | 13.0 | 24.0 | -45.6 |
| Investments | 4.8 | 3.5 | 37.4 | 10.9 | 12.4 | -12.3 |
| 30.09.2023 | 31.12.2022 | +/- | |
| Total assets | 612.7 | 621.2 | -1.6% |
| Interest bearing debt | 180.0 | 187.4 | -3.9% |
| Other liabilities | 57.9 | 52.9 | 9.6% |
| Equity | 374.8 | 381.0 | -1.6% |
| Number of shares | 263.0 | 263.0 | 0.0% |
Major events in Q3:
- Additional trips by the ferry Regula in September 2023
- Changes on the management board of AS Tallinna Sadam's subsidiary OÜ TS Shipping
- The administrator of the state shares in AS Tallinna Sadam from July 2023 is the Ministry of Climate
- Icebreaker Botnica 2023 summer charters - Equinor, British Petroleum and Baffinland
- The cruise terminal of Tallinn Old City Harbour obtains the international Green Key certificate.
- 30th anniversary of Paldiski South Harbour and laying the cornerstone for a new quay
- Crevex2023 evacuation exercise at Muuga.
Revenue
Revenue for nine months decreased by EUR 4.8 million (-5.2%) year on year to EUR 88.6 million. The decline is attributable to lower revenue from vessel dues, electricity sales, cargo charges and other services, which was not offset by higher revenue from ferry service between Estonia's mainland and two largest islands, passenger fees, the charter fees of the icebreaker Botnica in the segment Other and operating leases.
In terms of revenue streams, the biggest change in nine months was in vessel dues revenue, which declined by EUR 5.5 million (-18.6%) to EUR 24.1 million. This was mainly attributable to fewer calls by cargo ships and ro-pax vessels due to the decrease in cargo volumes as well as a drop in the number of cruise ship calls (-44.9%). In terms of segments, the decrease in nine-month revenue posted by the Cargo harbours and the Passenger harbours segments exceeded the revenue growth delivered by the Ferry segment and the segment Other (the icebreaker Botnica).
The nine-month revenue of the Passenger harbours segment decreased by EUR 1.0 million (-3.2%) year on year, mainly due to fewer cruise ship calls, which lowered the segment's vessel dues revenue (-EUR 2.1 million). In the third quarter, revenue decreased by 17.2% year on year to EUR 10.7 million (-EUR 2.2 million), mainly due to fewer cruise ship calls, which lowered vessel dues revenue.
The nine-month revenue of the Cargo harbours segment decreased year on year (-EUR 6.1 million, -21.2%). Vessel dues revenue dropped significantly (-EUR 3.5 million) because the number of vessel calls decreased due to the decline in cargo volumes. Cargo charge revenue decreased (-EUR 0.6 million) because volumes contracted for all cargo types with the exception of non-marine. Revenue from the sale of electricity decreased (-EUR 1.9 million) because consumption declined due to lower cargo volumes and electricity prices were lower than a year earlier. Lease income and revenue from the sale of other services also declined. The third-quarter revenue of the Cargo harbours segment decreased by EUR 2.2 million (-23.4%) year on year, mainly due to lower vessel dues and electricity sales revenue.
The nine-month revenue of the Ferry segment grew by EUR 1.7 million (+6.5%), driven by growth in ferry service revenue. Ferry service revenue grew through a rise in contractual fees due to an increase in the Estonian fuel cost, employment cost and consumer price indices. In the third quarter, the revenue of the Ferry segment grew by EUR 0.2 million (+1.6%) year on year.
The nine-month revenue of the segment Other grew by EUR 0.5 million (+6.0%). Revenue grew due to the additional summer charter of the icebreaker Botnica and higher charter fee revenue for the icebreaking season, both in the first half of the year. Revenue for the third quarter fell because the utilisation rate of Botnica was lower. Last year, the charter to Baffinland started earlier and the vessel had no idle days in the third quarter. In the third quarter of this year, the vessel was chartered to BP Exploration Operating Company and the charter to Baffinland in Canada started in early September, i.e. later than last year. Revenue for the third quarter dropped by EUR 0.6 million (-17.0%).
EBITDA
Adjusted EBITDA for nine months dropped by EUR 8.1 million (-17.2%) year on year to EUR 38.8 million. Adjusted EBITDA decreased the most in the Cargo harbours segment (-EUR 4.7 million), where revenue decreased and expenses increased. In the segment Other, the decline in adjusted EBITDA (-EUR 3.4 million) resulted from higher expenses and lower profit on the investment in the equity-accounted associate. The adjusted EBITDA of the Passenger harbours segment decreased (-EUR 0.9 million) due to lower revenue, which was slightly offset by lower expenses. Adjusted EBITDA grew only in the Ferry segment (+EUR 0.9 million), driven by revenue growth. Adjusted EBITDA for the third quarter decreased by EUR 4.5 million (-24.9%) year on year. Adjusted EBITDA decreased in all segments except the Ferry segment. Adjusted EBITDA margin for nine months dropped from 50.2% to 43.8% and adjusted EBITDA margin for the third quarter decreased from 49.6% to 43.0%.
Profit
Profit before tax for nine months fell by EUR 12.1 million (-43.0%) year on year to EUR 16.0 million. Profit decreased more than operating profit because the profit from the equity-accounted associate AS Green Marine decreased by EUR 0.4 million and finance costs (net) grew (+EUR 3.5 million). Profit for the first nine months decreased by EUR 10.9 million (-45.6%) year on year. Third-quarter profit was EUR 6.0 million (-EUR 5.7 million, -49.1%).
Investments
In the first nine months of 2023, the Group invested EUR 10.9 million, EUR 1.5 million less than a year earlier. The largest investments were made in the regular dry docking works and ice class upgrade of the icebreaker Botnica, building a new quay in Paldiski South Harbour, reconstructing a quay and a quay ramp and completing the reconstruction of the outdoor area around terminal D in Old City Harbour, increasing the capacity of Muuga Harbour to serve ro-ro cargo (second floor ramp), and software. Investments of the third quarter totalled EUR 4.8 million (EUR 3.5 million in the third quarter of 2022).
Interim condensed consolidated statement of financial position:
| in thousands of euros | 30.09.2023 | 31.12.2022 |
| ASSETS | ||
| Current assets | ||
| Cash and cash equivalents | 37,912 | 44,387 |
| Trade and other receivables | 14,074 | 7 477 |
| Contract assets | 582 | 0 |
| Inventories | 387 | 749 |
| Non-current assets held for sale | 0 | 100 |
| Total current assets | 52,955 | 52,713 |
| Non-current assets | ||
| Investments in associates | 2 137 | 2,099 |
| Other long-term receivables | 29 | 303 |
| Property, plant and equipment | 555,660 | 564 379 |
| Intangible assets | 1 968 | 1 735 |
| Total non-current assets | 559,794 | 568,516 |
| Total assets | 612,749 | 621 229 |
| LIABILITIES | ||
| Current liabilities | ||
| Loans and borrowings | 13,916 | 15,916 |
| Provisions | 978 | 2 013 |
| Government grants | 8 131 | 8,578 |
| Taxes payable | 1 726 | 1,060 |
| Trade and other payables | 9,598 | 9,770 |
| Contract liabilities | 1,650 | 62 |
| Total current liabilities | 35,999 | 37,399 |
| Non-current liabilities | ||
| Loans and borrowings | 166,099 | 171,482 |
| Government grants | 32,552 | 30 156 |
| Other payables | 529 | 449 |
| Contract liabilities | 2,765 | 767 |
| Total non-current liabilities | 201,945 | 202,854 |
| Total liabilities | 237,944 | 240 253 |
| EQUITY | ||
| Share capital at par value | 263,000 | 263,000 |
| Share premium | 44,478 | 44,478 |
| Statutory capital reserve | 22,858 | 22 115 |
| Retained earnings (prior periods) | 31 441 | 25,791 |
| Profit for the period | 13,028 | 25,592 |
| Total equity | 374,805 | 380,976 |
| Total liabilities and equity | 612,749 | 621 229 |
Interim condensed consolidated statement of profit or loss:
| in thousands of euros | Q3 2023 | Q3 2022 | 9M 2023 | 9M 2022 |
| Revenue | 31,426 | 36,325 | 88,615 | 93,460 |
| Other income | 371 | 412 | 1 231 | 1 140 |
| Operating expenses | -11,910 | -12,763 | -31,977 | -31,267 |
| Personnel expenses | -6,254 | -5,885 | -18,229 | -16,210 |
| Depreciation, amortisation and impairment | -6 129 | -6 191 | -19,356 | -18,703 |
| Other expenses | -55 | -55 | -280 | -249 |
| Operating profit | 7 449 | 11,843 | 20,004 | 28 171 |
| Finance income and costs | ||||
| Finance income | 330 | 32 | 916 | 97 |
| Finance costs | -2,073 | -404 | -5,303 | -1 011 |
| Finance costs - net | -1 743 | -372 | -4,387 | -914 |
| Share of profit of an associate accounted for under the equity method | 258 | 237 | 396 | 814 |
| Profit before income tax | 5,964 | 11,708 | 16,013 | 28,071 |
| Income tax | 0 | 0 | -2,985 | -4 111 |
| Profit for the period | 5,964 | 11,708 | 13,028 | 23,960 |
| Attributable to owners of the Parent | 5,964 | 11,708 | 13,028 | 23,960 |
| Basic and diluted earnings per share (in euros) | 0.02 | 0.04 | 0.05 | 0.09 |
| Basic and diluted earnings per share - continuing operations (in euros) | 0.02 | 0.04 | 0.05 | 0.09 |
Interim condensed consolidated statement of cash flows
| in thousands of euros | 9M 2023 | 9M 2022 |
| Cash receipts from sale of goods and services | 94,692 | 101,077 |
| Cash receipts related to other income | 247 | 135 |
| Payments to suppliers | -38,900 | -38,682 |
| Payments to and on behalf of employees | -18,511 | -14,673 |
| Payments for other expenses | -253 | -296 |
| Income tax paid on dividends | -3,264 | -4,335 |
| Cash from operating activities | 34,011 | 43,226 |
| Purchases of property, plant and equipment | -10,063 | -12,932 |
| Purchases of intangible assets | -627 | -346 |
| Proceeds from sale of property, plant and equipment | 28 | 91 |
| Proceeds from government grants related to assets | 0 | 4,924 |
| Dividends received | 357 | 255 |
| Interest received | 875 | 3 |
| Cash used in investing activities | -9,430 | -8,005 |
| Repayments of loans received | -7,383 | -7,383 |
| Dividends paid | -19,012 | -25,287 |
| Interest paid | -4,654 | -968 |
| Other payments related to financing activities | -7 | -7 |
| Cash from/used in financing activities | -31,056 | -33,645 |
| NET CASH FLOW | -6,475 | 1 576 |
| Cash and cash equivalents at beginning of the period | 44,387 | 34,840 |
| Change in cash and cash equivalents | -6,475 | 1 576 |
| Cash and cash equivalents at the end of the period | 37,912 | 36,416 |
Tallinna Sadam is one of the largest cargo- and passenger port complexes in the Baltic Sea region. 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 offshore services in Estonia and projects abroad. Tallinna Sadam group is also a shareholder of an associate AS Green Marine, which provides waste management services.
Additional information:
Marju Zirel
Head of Investor Relations
Tel. +372 53 42 6591
E-mail: m.zirel@ts.ee
