Containerships plc Stock Exchange Release 14 November 2017 at 5.30 pm EEST
Containerships plc's interim report July-September 2017
- Net sales EUR 55.8 (EUR 48.4) million
- EBITDA EUR 3.7 (EUR 3.4) million
- Net profit EUR 0.0 million (-EUR 0.6) million
- Guidance for 2017 remains unchanged: In 2017 net sales are expected to grow 10% and profitability (EBITDA) to improve on the previous year.
Market conditions and significant events
CONTAINERSHIPS is a full-service logistics company providing safe and fast container transportation in the Baltic Sea, North Sea and the Mediterranean. Containerships offers both standard and customised containers and variable logistics solutions from door to door. During the reporting period, Baltic Sea and North Sea traffic accounted for around 88% of net sales and the Mediterranean for around 12% of net sales.
There were no significant changes in the operational environment during the reporting period. The Russian market has remained challenging due to economic sanctions and country's overall economic situation. United Kingdom's Brexit decision has not impacted the group's business. No significant changes are estimated to occur in the operating environment in the near future.
The group continues to progress on its chosen investment track based on its environmentally friendly LNG strategy. Building of the LNG vessels has started numbering four in total, which will be delivered to the group during 2018. The group has increased the number of LNG-fuelled trucks in Great Britain and is exploring the possibilities to increase the number of LNG-fuelled trucks also in the Netherlands and Finland.
In the Mediterranean region, the group's own agency activities in Algeria have contributed a positive operative result. Business in Tunisia and Libya is being developed in partnership with local agents.
| Key figures, IFRS | 7-9/2017 | 7-9/2016 | Change | 1-9/2017 | 1-9/2016 | Change | 1-12/2016 |
| Net Sales, €m | 55,8 | 48,4 | 15,2 % | 166,2 | 147,3 | 12,8 % | 197,9 |
| EBITDA, €m | 3,7 | 3,4 | 10,2 % | 10,8 | 10,1 | 7,5 % | 13,9 |
| as % of Net Sales | 6,7 % | 7,0 % | 6,5 % | 6,8 % | 7,0 % | ||
| EBIT, €m | 2,0 | 1,4 | 43,9 % | 5,1 | 4,0 | 27,2 % | 5,9 |
| as % of Net Sales | 3,5 % | 2,8 % | 3,1 % | 2,7 % | 3,0 % | ||
| Net Profit, €m | 0,0 | -0,6 | 0,1 | -2,2 | -1,4 | ||
| as % of Net Sales | 0,0 % | -1,2 % | 0,1 % | -1,5 % | -0,7 % | ||
| Equity ratio | 17,1 % | 11,9 % | 16,8 % | ||||
| Equity ratio, adjusted | 22,0 % | 20,8 % | 21,3 % | ||||
| Personnel, on average | 570 | 529 | 532 | ||||
| Containerships discloses EBITDA and adjusted equity ratio as alternative key figures because management considers them to better describe the group's EBIT and financial position and to improve comparability. The consolidated statement of comprehensive income shows the reconciliation of EBITDA on EBIT. Equity ratio adjusted (Equity/total assets x 100) includes a capital loan of €5 million. However, these alternative key figures do not replace key figures in accordance with IFRS. | |||||||
The group's net sales for the third quarter were EUR 55.8 (48.4) million, up 15.2% year on year. Falling freight prices in the Baltic Sea and North Sea levelled out and showed a slight rise towards the end of the quarter. Market conditions and competition in the Mediterranean were challenging during the quarter and both business volumes and the price level were in retreat. The group developed its operations to better respond to customer needs in the Mediterranean. This resulted in sales growth towards the end of the quarter. Thanks to the measures introduced, the group sees that the positive trend in sales will continue and profitability will improve in the Mediterranean for the rest of the year.
Operating profitability improved slightly in the third quarter: EBITDA showed an improvement of EUR 0.3 million and operating profit an improvement of EUR 0.6 million compared to the previous year. EBITDA for the third quarter was EUR 3.7 million, equating to 6.7% of net sales (EUR 3.4 million, 7.0%). Operating profit was EUR 2.0 million, equating to 3.5% of net sales (EUR 1.4 million, 2.8%). Profitability improved on the back of better utilisation rates, driven mostly by operational efficiency measures and the positioning of empty containers. On the other hand, the rise in the price of oil on the global market and 45 % higher fuel costs compared to previous year increased operating costs significantly, which in turn eroded profitability.
Net profit for the third quarter was EUR 0.0 (-EUR 0.6) million, up EUR 0.6 million. Part of the interest costs on the bond have been capitalised in the cost of building the ships in accordance with general practice since the prepayments for the vessels were made in October 2016. The equity stated in the IFRS report does not include a capital loan of around EUR 5 million. Adjusted equity is around EUR 26 million, whereas in the IFRS calculation it is around EUR 20 million.
The group's operational cash flow was challenging than a year earlier and was EUR 1.1 million negative.
Most significant risks looking ahead
The most significant risks in Containerships' business relate to fluctuations in the price of oil and to political uncertainty in the Russian and Turkish markets. Risks and risk management are detailed on the group's website and in the financial statements. The group does not consider there to have been any material changes in risks during the reporting period.
Outlook
Guidance for 2017 remains unchanged. In 2017, net sales are expected to grow 10%. EBITDA for the third quarter was, as planned, slightly better than a year earlier and EBITDA for the full year is expected to improve on the previous year.
Work will continue on improving operating efficiency. Efforts will be made to develop sales work by focusing on those segments and regions where growth can be captured and by further improving efficiency especially in those regions. The group does not expect any major changes in market conditions. The challenging situation in the Mediterranean is expected to continue.
Work on building the LNG vessels is underway and delivery will take place as planned in 2018. In addition, the group will continue to focus on developing LNG-fuelled truck traffic.
Containerships plc will publish its 2017 annual report on 12th of March 2018.
Containerships plc's bond totalling EUR 50.5 million issued on 2 April and 28 October 2015 has been listed on Nasdaq Helsinki since 1 April 2016.
Further information:
CEO, Kari-Pekka Laaksonen, phone +358 50 550 2555, kari-pekka.laaksonen(at)containerships.fi
Containerships plc has reported its results in accordance with IFRS accounting principles since the start of 2016. Interim reports are prepared in accordance with IFRS accounting principles, but exclude the notes to the financial statements as required under IAS 34 Interim Financial Reporting. When preparing the interim report, the company has complied with the same accounting principles as in the IFRS financial statements for 2016. The information presented in this interim report is unaudited.
Appendix 1: Containerships plc Statement of comprehensive income, Balance sheet, Statement changes of equity and Cash flow statement.
Attachments:http://www.globenewswire.com/NewsRoom/AttachmentNg/df24f4bd-8ced-4678-8ba4-ef550cce872c
