Containerships Interim Report Q1- 2016
Market and company events
The business environment has remained challenging. Especially the inbound volumes to Russia are still under pressure. The Company has continued to replace the weak domestic market in Russia with growing volumes to and from Finland and the Baltics. The westbound volumes have exceeded the eastbound volumes.
The Company has listed its bond and became a plc in the beginning of April.
This is the Company’s first quarterly report according to IFRS. The operational result in Q1 does not have any major one offs. The quarterly report is not audited, only to annual report is going to be audited.
Containerships Group’s net sales in the first quarter of 2016 amounted to EUR 49.1 million (€ 49.5 m).Sales volume (carried TEUs) development was positive and increased by 11.9%. However, the price level due to the sales mix and market situation was clearly below last year, which resulted in sales remaining at the same level as last year. Q1 2015 included the SECA surcharge, which disappeared later in the year due to a drop in oil prices and competition. This explains the price decrease in the first quarter compared to the previous year.
EBITDA was at the same level as last year and EBIT was slightly better than Q1/2015. Both were also above the budgeted Q1/2016. The performance improvement (better utilization and less empty positioning) and decreased bunkering costs lowered the costs during Q1, which was partly eaten up by higher chartering costs. The total costs were at the same level as last year. The other operating income was up mainly due to some recovery of the oil hedging bookings from the year end. The net result of financial income and expense was clearly negative, worsening the result with almost €3.3 million. This was partly due to higher interest costs related to the bond financing and the effect of the currency exchange rate. Last year, the Company enjoyed the currency gain and currency hedging gain, which are missing from this year. The key currency USD has remained at the same level, no significant losses and gains were made during Q1. The Company is hedging its open position with the USD at the current level. Net financial costs were €3.3 million higher than last year, from which the effect of the currency exchange rate was €2.3 million. Net debt is at the same level as it was at the end of 2015.
Market conditions continue to be challenging. Despite that, the Company is maintaining its financial targets for 2016 unchanged. Estimated sales growth for 2016 is between 5-10% and the EBITDA target is at least EUR 13 million (a growth of about 50%). This is based on focusing on segments and regions where we can expect growth as well as improved efficiency of the operations. Possible European recovery, economic growth including Russia relationships and oil price development will have an effect on Containerships’ performance.
The first four LNG vessels are targeted to be delivered during 2018, as informed. However, the delivery of the first vessel will be delayed until early 2018 due to a change in the shipyard. Re-negotiations of the two company-own-financed vessels and two other vessels are ongoin
The Company is going to publish the following stock releases about the 2016 result Q2/2016 on August 16, 2016, Q3/2016 on November 15, 2016 and Q4/2016 and 2016 result on February 28, 2017
For more information, please contact:
Kari-Pekka Laaksonen, CEO
tel. + 358 20 744 1364
Nasdaq Helsinki Ltd