Tallink achieves Q3 growth despite rise in bunker costs

Ferry operator expecting improved operating results in 2017 thanks to LNG-fuelled ferry.

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Updated on 22 Nov 2017 11:51 GMT

Cruise vessel operator Tallink reports that it managed to achieve growth in its third-quarter (Q3) results despite a year-on-year (YoY) rise in bunker costs.

In its key figures for Q3, released on Tuesday, Tallink posted a net profit of EUR 47.8 million, compared to last year's net profit of EUR 42.8 million - a rise of 11.7 percent.

Revenue for the period increased by 3.3 percent to EUR 282.7 million. Gross profit rose 6.7 percent YoY to EUR 81.9 million, whilst EBITDA was up 12.3 percent YoY to EUR 75.4 million.

Tallink explained that Q3 growth was driven by a higher number of passengers and transported cargo units, attributable to the higher capacity, and more optimal operating costs resulting from three vessels on the Tallinn-Helsinki route. However, the result was also impacted by a YoY rise in fuel costs, Tallink noted.

The ferry operator also said it expects to see a YoY increase in its operating results for 2017 thanks to the introduction of its new LNG-fuelled vessel.

"The Group's management expects the operating results for 2017 to be better than that for the previous financial year thanks to the addition of a new fast LNG ferry, Megastar, in January and the rerouting of ships carried out in December 2016," Tallink said in its Q3 report.

At the start of the year, the Megastar started operating the Tallink Shuttle service on the Tallinn-Helsinki route next to fast ferry Star, replacing the Superstar, which was returned to its owners.

Christened on July 1, 2016, the Megastar is 212 metres long with modern dual-fuel engines capable of running on both LNG and distillate fuel.

Despite posting a 6 percent YoY drop in revenue to EUR 96.9 million in Q3, the Estonia-Finland segment result was up 2.5 percent YoY at EUR 28.8 million.