Hurtigruten, the listed Norwegian company that operates the coastal express service and expedition cruises, says its second quarter profit fell, while loss for the first half narrowed, as the company continues efforts to restore sustained profitability.
In the second quarter, pre tax profit decreased by NOK9 million to NOK103 million year on. For the first half of 2013, the company booked a loss of NK30 million, which was NOK9 million less than in the corresponding period last year.
“The quarter was characterised by an expected decline in volume along the Norwegian coast, with cruise nights down by 14.3% from the same period of
last year. This downturn was largest in the Nordic region and Germany, two important markets for Hurtigruten. The competition along the Norwegian coast is strengthening,” Hurtigruten said, adding that more foreign cruise liners now sail on the Norwegian coast and many of them head up inside the Arctic Circle.
Net ticket revenue per cruise night rose by 2.6% as a result of more active price management and an increased commercial focus on the ships. That applies particularly to the sale of excursions, which grew by 19% per cruise night from the same quarter of 2012.
“While Hurtigruten Norwegian coast faced a challenging quarter in terms of sales, explorer products MS Fram and Spitsbergen made progress. Both achieved substantial improvements in operating profit before depreciation and impairment (EBITDA). With unique experiences of nature on land and at sea, they address a growing international market. Second quarter EBITDA rose by NOK7 million for MS Fram and NOK6 million for Spitsbergen from the same period of 2012.
Group costs totalled NOK775 million in the quarter, down by NOK46 million from the same period of last year. This decline primarily reflects a reduction in cruise nights along the Norwegian coast and NOK11 million in administrative savings as a result of efficiency improvement measures. Consolidated EBITDA came to NOK258 million in the second quarter, compared with NOK299 million the year before.
“A far-reaching efficiency improvement programme was launched in December 2012. This has implemented a structural turnaround, driven by qualified internal personnel with support from an external consultant. The programme has delivered on all points over half a year,” Hurtigruten stated.
