Transcript Global PowerPoint Template (Title Master

Investor presentation
October 2006 Riga
Financial Year 2005/2006
KEY EVENTS
2

Successful IPO and listing on the Tallinn Stock Exchange in December 2005;

Ordering of a new cruise ferry, a sister vessel of M/S Galaxy;

The delivery of M/S Galaxy;

Starting operations between Riga and Stockholm;

The acquisition of Superfast vessels and the launch of Finland - Germany service;

The sale of M/S Autoexpress;

M/S Fantaasia chartered to Mediterranean from;

Acquisition of Silja ferry business;

Rights Issue to the shareholders.
Financial year 2005/2006
9 months Key Figures
(in € million)
Net sales
Net profit for the period
Net profit margin (%)
EBITDA
EBITDA margin (%)
Depreciation
Capital Expenditure
Number of passengers (millions)
Cargo units (thousands)
Average number of employees (thousands)
Total assets
Total liabilities
Interest-bearing liabilities
Total equity
Equity/assets ratio (%)
Weighted average number of shares outstanding
Shareholder’s equity per share
3
01.09.2005- ‘
31.05.2006
194.9
8.4
4.3
31.1
15.9
14.7
480.4
01.09.200431.05.2005
181.5
11.9
6.5
32.7
18.0
12.9
20.0
Change %
2.2
116.8
2.8
2.2
96.5
2.7
-3.0
21.0
2.5
31.05.2006
970.3
660.9
615.2
309.4
31.9
126,987,179
2.44
31.08.2005
442.7
273.0
245.2
169.7
38.3
110,000,000
1.54
Change %
119.2
142.1
150.9
82.3
-16.7
15.4
57.9
7.4
-29.1
-4.9
13.9
2,300.0
Tallink’s vessels
High-quality, flexible fleet
High-speed
Ferries
Cruise
Ferries
Romantika
Victoria I
Galaxy
AutoExpress 2
Meloodia I
Regina Baltica
Vana Tallinn
Fantaasia
Fast Ro-pax
AutoExpress 3
Ro-ro Cargo
Ferries
Regal Star
AutoExpress 4
Kapella
Superfast VII , Superfast VIII , Superfast IX
As a result of its ongoing investment and fleet renewal program, Tallink
deploys some of the most advanced cruise ferries in the region.
4
Silja’s vessels
High-quality, flexible fleet
Silja Serenade
Silja Symphony
Cruise
Ferries
Sky Wind
Ro-pax
Ferries
Silja Europa
Silja Festival
As a result of its ongoing investment and fleet renewal program, Tallink
deploys some of the most advanced cruise ferries in the region.
5
Sea Wind
Share price
December 2005 – September 2006
€
Since listed on the Tallinn
Tallink
600
Stock
Exchange, a large
Baltix
proportion of turnover is

6.0
derived directly from trading
550
Tallink’s
shares
5.5
— 34.9% of Tallinn Stock
500 Exchange share
turnover (09.12.05 –
18.09.06)
5.0
4.5
450
4.0
— 20.0% of Total Baltic
Market share turnover
400 (09.12.05 – 18.09.06)
3.5
350
3.0
300
December
January
March
Source: Tallinn Stock Exchange
6
February May
April
July
June
August
September
Tallink in brief

Tallink is the biggest ferry operator in Northern Baltic Sea offering mini-cruise, passenger
transportation and ro-ro cargo transportation services.

21 vessels linking 10 ports on seven routes between:
— Finland and Estonia;
— Finland and Sweden;
— Sweden and Estonia;
— Sweden and Latvia;
— Finland and Germany.

350 room hotel operation in the center of Tallinn

Annual revenue base over 620 million euro *

Over 6,000 employees

More than 6.5 million passengers annually *
* Combined with the 12 months pro forma figures of the acquired Silja Line ferry business
7
Tallink: The strongest in the Baltic Sea
“The biggest Northern Baltic
shipping group providing
high-quality mini-cruise and
passenger transport
services, as well as a
leading provider of ro-ro
cargo services on selected
routes”
8

Outstanding macro fundamentals

Strong market position

High-quality, flexible fleet

Broad product offering

Strong brands

Competitive cost base

Experienced management team
Tallink business model
Product Offering
Mini-cruise, Hotel and Travel Packages
Success Story and Growth Drivers

Broad transportation, leisure and retail product:
complete mini-cruise and overnight hotel & spa
packages, city-break day trips, high-speed ferry
and cargo

Highly popular mini-cruise product across
Scandinavia and the Baltics with extensive onboard
retail and entertainment facilities

Our destinations are attractive and lucrative for
tourism and shopping destination

Significant demand from business customers,
tourism and cargo traffic boosted by EU accession
High-speed, Passenger and Cargo Traffic
9
Tallink passenger growth
Strong passenger growth over the past decade
Total Tallink Passenger Volumes
3 500
Passengers (in '000)
3 000
2 500
Over the past decade, Tallink
has outperformed a fastgrowing home market and is
set to capitalise further on
Tallinn’s growing
attractiveness as a tourist
destination.
2 000
1 500
1 000
500
10
/0
5
04
/0
4
03
/0
3
02
/0
2
01
/0
1
00
/0
0
99
/9
9
98
/9
8
97
/9
7
96
95
/9
6
0
The Baltic ferry sector in a global context
(in million)
(in million)
Tallink: Positioned at the heart of an exciting growth market
Passenger Traffic – Global
600
Passenger Traffic – Baltic and Scandinavia
15,0
16
536
20%
14
500
16%
12
400
291
300
12%
8,5
187
166
133
4%
2,6
0%
4
(in million)
24
0
America
Baltic
4,1
6
100
Asia
8%
6,2
8
200
(in million)
9,4
10
Med
1,3
2
0,7
-4%
0,6
0
-8%
DK-SE*
FI-SE DK-D
FI-E
North
Pacific
Sea
Trailer Traffic – Global
0,9
DK-N D-SE N-SE
PL-SE
SE-E
D-N
Trailer Traffic – Baltic and Scandinavia
12
1,0
10
10
20%
0,8
16%
0,8
8
7
7
0,6
4
0,3
2
1.0
0,2
0,2
0,2
0,1
0,04
0,1
0.4
0,0
0
Med
North Sea Baltic
11
0,4
0,4
Asia
AmericaPacific
D-SE
DK-SE*
DK-D
FI-SE
*Note: Red Sea region excluded due to negligible volumes; North Sea includes Inland Lakes Europe; Domestic Baltic and Scandinavian markets excluded
DK – Denmark; SE – Sweden; FI – Finland; D – Germany; E – Estonia; N – Norway; PL – Poland; DK-SE includes data from Oresund bridge crossing
Source: ShipPax, 2004 & 1996 data;
PL-SE
FI-E
DK-N SE-E
D-N
CAGR 1996-2004
6
4
12%
0,6
8%
4%
0%
0,03
-4%
N-SE
Tallink routes

Tallink operates between:
— Helsinki and Tallinn;
— Stockholm and Tallinn;
— Paldiski and Kapellskär;
— Stockholm and Riga;
— Hanko and Rostock;
— Helsinki and Stockholm;
— Turku and Stockholm/Kapellskär.

12
Northern Baltic Sea region –
17 million passenger market
Finland – Estonia
Helsinki – Tallinn
Customers and Products

Market Share
Nordic Jet
Line
Helsinki – Tallinn
Linda
3%
7%
— Revenues mainly from onboard and ticket sales
Eckerö Line
— Approximately 80% of the passengers are Finnish
14%
— 3.5 hour trip with day ferry
43%
— 1 hour 40 minute trip with high-speed ferry
— 22 hour over-night cruise with “Galaxy”

Viking Line
Investments
15%
— In 2002 and 2006 two brand new vessels
18%
— In 2007 brand new Ro-pax ferry will be introduced
Key Words
Galaxy
Auto Express 2
13
Meloodia
Regal Star
Auto Express 3
Auto Express 4

Developing passenger market

Increased cargo demand
Finland – Sweden
Helsinki – Stockholm; Turku – Stockholm/Kapellskär
Customers and Products

Market Share
Helsinki – Stockholm
Helsinki-Stockholm
— Revenues mainly from onboard and ticket sales
Viking Line
— Approximately 65% passengers are Finnish
44%
— Over-night cruise
56%
Turku-Stockholm
Silja Serenade

Viking Line
Silja Symphony
43%
Turku – Stockholm/Kapellskär
57%
— Revenues mainly from cargo and ticket sales
— Majority of passengers are Finnish
— Over-night and day trips
Silja Europa
14
Silja Festival
Key Words

Sea Wind / Sky Wind
Tax-free status (via Aland
islands)

Strong brand – Silja

Loyal passenger base

Increased cargo demand

Overnight cruise

City-break

Hotel package sales
Sweden – Estonia
Stockholm – Tallinn; Kapellskär – Paldiski
Customers and Products

Stockholm – Tallinn route
Market Share

— Revenues mainly from onboard and ticket sales
— Approximately 70% of passengers are Swedish
Tallink is the only provider of daily
passenger and ro-ro cargo services on the
routes between Sweden and Estonia
— Over-night cruise
Key Words

Tax-free status (via Aland islands)

High development potential
Paldiski – Kapellskär route

Overnight cruises
— Revenues mainly from cargo and ticket sales

City-breaks
— Approximately 70% of passengers are Estonian

Hotel package sales
Romantika

Victoria
— 11,5 hour trip
Vana Tallinn
15
Kapella
Sweden – Latvia
Stockholm – Riga
Customers and Products

Stockholm – Riga route
Market Share

— Revenues mainly from onboard and ticket sales
— Approximately 70% of passengers are Swedish
Tallink is the only provider of regular
passenger and ro-ro cargo services on the
route between Sweden and Latvia
— Over-night cruise
Key Words
Regina Baltica
16

High growth potential

Overnight cruise

City-break

Hotel package sales
Finland – Germany
Hanko – Rostock
Customers and Products

Freight Market Share in 2005
Power-line
Hanko – Rostock route
4%
— Revenues mainly from cargo sales
Transfennica
— 24 hour trip
Superfast VII
21%
Superfast VIII
29%
Superfast IX
Finnlines
46%

17
High quality fast ice-classed vessels
Key Words

The fastest link between Finland and
Germany

High cargo space utilization

Potential in passenger transportation
Proven strategy
Market leadership and investment for profitable growth

Continue to invest in our fleet
— Central to maintaining market leadership and growing our business
— Enhanced efficiency and profitability
— Increased per-passenger spend from a wider demographic customer base
— Further strengthening of the Tallink & Silja brands

Build upon strong positions on existing routes
— Strengthen overall market share and volumes
— Further increase strong brand recognition
— Broader customer base
— Enhanced mini-cruise experience and promotion of our different travel destinations

Pursue new growth opportunities in the North Europe region
— Potential route expansion
— Travel-related products, services and packages

18
Maintain profitability through efficient and flexible management while seeking revenue growth
High quality fleet
Sophisticated and modern vessels
Ferries Built for the Region
New Cruise Ferry II
Europa
High-speed ro-pax II
Superfast VII and VIII
Gabriella
Symphony
Cinderella
90
Galaxy
Superfast IX
Serenade
89
High-speed ro-pax I
Victoria I
Paradise*
Romantika
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
08
Year
Cruise Ferries
High-speed Ro-pax Ferries

Fleet renewal

Helsinki–Tallinn in less than 2 hours

Higher quality of onboard facilities

Increased passenger, cargo and retail capacity

Increased passenger, cargo and retail capacity

Expanded onboard consumption and retail facilities

Increased profitability through lower cost per
passenger

Reduce seasonality through ice-class specification
*Note: Pure cruise vessel with no separate cargo or passenger car deck
19
Cargo un
Passen
Strong operational and financial track record
Significant growth momentum across all key indicators
Passenger Growth Since 02/03
Revenue Growth Since 02/03
3 500
Cargo Growth Since 02/03
200
300
260
3 000
3 274
250
150
218
2 828
2 500
131
2 598
(in € million)
200
2 000
1 500
192
103
95
100
150
100
1 000
50
50
500
0
0
02/03
03/04
04/05
0
02/03
03/04
04/05
*Note: Excludes revenue from cargo operations
EEK/€ pegged since 1999 (EEK15.6466 = €1)
Profitable growth is key to Tallink’s success – this has been demonstrated over the
past three years and will remain central to its investment case going forward.
20
02/03
03/04
04/0
Group financial data
(in € million)
2002/2003
2003/2004
2004/2005
191
218
260
51
46
58
26.8%
21.1%
22.2%
Net Profit
24
20
30
Operating Cash Flow
54
51
57
Capital expenditure
(40)
(153)
(23)
Total assets
291
442
443
Total liabilities
197
302
273
94
139
170
ROE (1)
30%
17%
20%
Equity assets ratio (2)
32%
31%
38%
Sales
EBITDA
Margin (%)
Shareholders equity
*Note:
(1) ROE represents net profit / average equity for the period
(2) Equity Asset ratio = shareholders equity / total assets
EEK/€ pegged since 1999 (EEK15.6466 = €1)
21
Investor presentation
October 2006 Riga