Correction: AS Tallinna Sadam financial results for 2023 Q2 and 6 months

In the correction announcement, the adjusted EBITDA and adjusted EBIDTA margin indicators for 6 months in the table "Key figures" have been amended.

In the second quarter, Tallinna Sadam earned 29 million euros in sales revenue and 1.4 million euros in profit. The revenue for six months was 57 million euros and the profit reached 7 million euros. In the second quarter, the volume of investments increased to 4.6 million euros, in the first half of the year we invested a total of 6.1 million euros.

In the second quarter, both sales revenue (-5%), adjusted EBITDA (-24%) and profit (-73%) decreased year-on-year. Semiannually, the revenue remained at the previous year's level, but the adjusted EBITDA (-12%) and profit (-42%) fell due to the pressure of cost growth.

The financial results of six months were significantly affected by both the increase in the number of passengers and the decrease in cargo volumes. While the passenger business continued to recover steadily on regular lines and there is still growth potential to reach the pre-COVID restrictions level, cargo volumes continue to decline due to sanctions and the general decrease in cargo volumes. In shipping, both ferries and the icebreaker Botnica showed growth, but regular dock work and costs related to the new charter contract affected Botnica's profitability. Rising service prices and wage pressure increased operating costs, financial costs also increased.

Tallinna Sadam management will present the financial results of the Group at a webinars on 10 August, including webinar in Estonian starting at 10.00 (EEST) (link to EST webinar) and webinar in English starting at 11.00 (EEST) (link to ENG webinar).

Key figures (in million EUR):

Major events in Q2:

• Additional trips by the ferry Regula in summer 2023
• Icebreaker Botnica additional summer charter contract with Equinor
• Agreement to build a new quay for construction of offshore windfarms in Paldiski South Harbour
• Johann Peetre was recalled from the supervisory board of AS Tallinna Sadam’s subsidiary OÜ TS Laevad
• Establishing Hydrogen Valley of Estonia

Revenue
Revenue for the first half of 2023 grew by EUR 54 thousand (+0.1%) year on year to EUR 57.2 million. Revenue remained at the same level as a year earlier due to growth in revenue from ferry service between Estonia’s mainland and two largest islands, passenger fee revenue in the Passenger harbours segment and charter fee revenue in the segment Other, which offset the decrease in revenue from vessel dues, cargo charges and electricity sales. In terms of revenue streams, the biggest change in the first half-year was in vessel dues revenue, which dropped by EUR 2.2 million (–12.2%) to EUR 16.0 million. This was mainly attributable to fewer calls by cargo ships and ro-pax vessels due to decreasing cargo volumes as well as a decline in the number of cruise ship calls (–35.3%). Cargo charge revenue decreased less than cargo throughput (–30.6%), because the decline was stronger for cargo with lower charge rates. In terms of segments, six-month revenue grew in the Passenger harbours segment, the Ferry segment and the segment Other (the icebreaker Botnica), which offset the revenue decrease in the Cargo harbours segment.

The six-month revenue of the Passenger harbours segment grew by 7.6% year on year, mainly through an increase passenger fee revenue (+EUR 1.0 million) due to rapid growth in passenger numbers and higher lease income (+EUR 0.2 million). In the second quarter, revenue decreased by 6.7% year on year to EUR 9.3 million (–EUR 0.7 million). This was mainly due to lower revenue from vessel dues in connection with fewer cruise ship calls.
The six-month revenue of the Cargo harbours segment decreased year on year (–20.1%). Vessel dues revenue dropped significantly (–EUR 2.2 million) as the number of vessel calls fell due to a drop in cargo volumes. Cargo charge revenue decreased (–EUR 0.5 million) because volumes contracted for all cargo types (particularly liquid bulk and general cargo). The second-quarter revenue of the Cargo harbours segment decreased by EUR 2.2 million (–22.3%) year on year, mainly due to lower vessel dues revenue, cargo charge revenue and electricity sales revenue.
The six-month revenue of the Ferry segment grew by EUR 1.5 million (+9.5%) due to growth in both ferry service revenue and lease income. Ferry service revenue increased through a rise in contractual fees due to an increase in the Estonian fuel cost, employment cost and consumer price indices. In the second quarter, the revenue of the Ferry segment grew by EUR 0.6 million year on year (+6.3%).
The six-month revenue of the segment Other grew by EUR 1.1 million (+24.7%). Revenue grew due to the summer charter of the icebreaker Botnica and higher charter fee revenue for the icebreaking season (under a new contract with the Transport Administration), even though the summer charter of Botnica was cut short due to technical changes made to the project (9 days instead of 40 days). Revenue for the second quarter grew by EUR 0.8 million (+80.5%) through the summer charter of Botnica and higher revenue in the icebreaking season that ended on 20 April.

EBITDA
Adjusted EBITDA for the first half-year dropped by EUR 3.6 million (–12.4%) year on year to EUR 25.3 million. Adjusted EBITDA growth the Passenger harbours segment and the Ferry segment could not offset the decrease in the Cargo harbours segment and the segment Other. The adjusted EBITDA of the segment Other decreased due to higher expenses incurred in the second quarter in connection with the regular dry dock maintenance and repairs of the icebreaker Botnica. Adjusted EBITDA margin for the first half-year decreased from 50.5% to 44.2% and adjusted EBITDA margin for the second quarter decreased from 50.7% to 40.7%.

Profit
Profit before tax for the first six months fell by EUR 6.3 million (–38.6%) year on year to EUR 10.1 million. Profit for the first half-year decreased by EUR 5.2 million (–38.6%) year on year. Second-quarter net profit was EUR 1.4 million (–EUR 3.7 million).

Investments
In the first six months of 2023, the Group invested EUR 6.1 million, EUR 2.8 million less than a year earlier. The largest investments were ma de scheduled dry docking works and investments for improving ice class on the icebreaker Botnica, in building a new quay in Paldiski South Harbour, reconstructing a quay and completing the reconstruction of the outdoor area around terminal D in Old City Harbour and, increasing the capacity of Muuga Harbour to serve ro-ro cargo (secondII floor ramp) and information technology. Investments of the second quarter totalled EUR 4.6 million (Q2 2022: EUR 4.3 million).

Interim condensed consolidated statement of financial position:

Interim condensed consolidated statement of profit or loss:

Interim condensed consolidated statement of cash flows:

Tallinna Sadam is one of the largest cargo- and passenger port complexes in the Baltic Sea region, which serves annually 10 million passengers and 20 million tons of cargo in average. 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.

Additional information:

Marju Zirel
Head of Investor Relations
Tel. +372 5342 6591

m.zirel@ts.ee

Attachments

• Tallinna Sadam interim report 6 months 2023 ENG
• Q2 2023 webinar presentation ENG
• Tallinna Sadam Financial Results Q2 2023 Data