The impact of the COVID-19 pandemic continued in the third quarter
The impact of the COVID-19 pandemic continued in the third quarter, which resulted in a decrease in revenue, adjusted EBITDA and profit of Port of Tallinn group (AS Tallinna Sadam), the company says in a press release. In Q3 2020, the revenue amounted to EUR 31.8 million decreasing by 18.9% compared to the same period previous year. The adjusted EBITDA was EUR 19.9 million decreasing by 16.2% and profit of Q3 amounted to EUR 13.6 million decreasing by 23.1%. At the same time, the adjusted EBITDA margin increased by 2.1 percentage points and the volume of investments by almost 50% to EUR 11.5 million.
The results of Q3 were mostly affected by the restrictions on passenger movement due to the COVID-19 pandemic, which were significantly milder in the summer period than in Q2. According to Valdo Kalm, Chairman of the Management Board, a diverse business model significantly mitigates the impact of the pandemic on the Group’s financial results. Kalm noted that the cargo harbours segment continued to grow strongly, but due to competition, revenue per tonne decreased somewhat, especially for liquid bulk. Ferries and the icebreaker Botnica, or the shipping business, keeps a stable course.
“Passenger business is currently in decline, but we will continue to invest heavily in the Old City Harbour passenger port, because we believe that in the long run the impact of the pandemic will be temporary and passenger traffic will recover in the coming years,” said Kalm.
The impact of the cost-cutting measures implemented in Q2 took effect predominantly from Q3. “Continuously strong positive EBITDA and secure cash flow will enable us to ensure the company’s liquidity and profitability and meet the dividend policy, i.e. to pay at least 70% of the previous year’s profit as dividends in 2021,” Kalm confirmed.