Tallink’s shop and restaurant sales accelerate to €142.3 million in second quarter

ESTONIA. Baltic short cruise and ferry company Tallink Grupp – which celebrates its 30th anniversary this year – saw an improvement of +1% in its restaurant and shops sales (on-board and onshore) in the second quarter. However, first half sales were marginally down by -0.3%.

Second quarter sales reached €142.3 million while Tallink achieved €245.4 million in the first half for its biggest division which accounts for 55.6% of the company’s total revenue.

There was a marked improvement in retail and restaurant sales in the first quarter versus a negative trend in the first half (see above).
How Tallink’s business breaks down by business segment and routings (based on second quarter results)

Factors that impacted the first quarter included the planned dockings of seven ships that resulted in 50 fewer trips compared to the same period last year. Among other ships, the maintenance and repair of the cruise ferry Baltic Queen lasted for 42 days. High competition on the busy route between Estonia and Finland, also put pressure on ticket prices according to Tallink.

Retail and F&B shows resilience

Nevertheless, the retail and F&B business was resilient in comparison to traffic. In the second quarter (April to June) the group transported a total of 2.7 million passengers, a +0.8% increase on the same period last year. However, in the first half traffic fell by -1.2% to 4.5 million, compared to the far slighter easing in restaurant and shops sales (-0.3%).

Route traffic shows that the Finland-Sweden  service remained strong
Paavo Nõgene: “We have a number of plans in the pipeline and are focusing on a number of business areas to further improve results for the second half.”

This was helped by the fact that of the company’s four major routes, the most important for retail sales – Finland to Sweden – saw growth of +4.2% in the first half, while all other routes showed declines in their passenger numbers. The Finland to Sweden route, where Tallink’s larger Silja Line ships operate, is also the core one that offers duty free sales onboard.

Commenting on the results, CEO of Tallink Grupp Paavo Nõgene described the company’s first half numbers as an “overall steady outcome”. He added: “We can be happy with the high-level results and the developments of the second quarter, which have helped deliver a steady half-year result and have laid a strong foundation for 2019 overall. We have a number of plans in the pipeline and are focusing on a number of business areas to further improve the results for the second half of the year.”

Nõgene did not elaborate on what these specific plans or business areas were. However, the group made several investments in the second quarter, the most notable being a €12.4 million prepayment for a new shuttle vessel similar to Megastar for its busiest route from Finland to Estonia.

The full quarterly and first half group profit and loss statement(unaudited) can be seen below.

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