AS Tallink Grupp, the Estonian cruise ferry company, has warned that its full year results would be weaker than those in 2013 on competition and demand woes.
“Due to increased competition and continuously weak Nordic economic environment the Management expects the results to be weaker for the 2014 financial year compared to the last year,” the company said in a statement.
Tallink unveiled a second quarter net profit of €6.1 million, down from €9.3 million in the same period last year. Revenue fell to €246.4 million from €249.0 million. For the first half of 2014, the group’s net loss widened to €17.3 million from €8.3 million on revenues of €434.7 million, down from €439.6 million a year earlier.
In the full year 2013, the group made a net profit of €43.3 million on revenues of €941.8 million.
“In the second quarter the Estonia-Finland route showed a slight decline with passengers numbers decreasing by 2.7%, cargo units transported increased by 6.6%, the sales numbers remained on the last year’s level,” the company said.
Tallink’s operations were affected by the shuttle vessel Star being out of operation for 68 trips in April, undergoing car deck ramp repairs. The ship was only partially replaced during that time. In the same time the competitors on the route have increased the number of departures.
“In the second quarter the segment result for the Finland-Sweden segment was €4.9 million lower than last year. The decline came from the Turku-Stockholm route, where revenue decreased due to the vessels Galaxy and Baltic Princess being out of operations for scheduled maintenance works and passengers’ spending showing weaknesses in an overall weak macroeconomic development,” Tallink ststed.
Meanwhile the recently upgraded cruise ferry Silja Serenade on the Helsinki- Stockholm route has delivered positive developments. Higher customer satisfaction and on-board spending levels are confirming that the investment was successful and has a positive effect to the business in the longer run.
The group’s vessels carried nearly 2.4 million passengers,which is 0.5% more compared to the same period last year. The number of cargo units transported decreased by 1.0% and the number of passenger vehicles transported increased by 0.7% for the same period as last year.
