Containerships plc’s interim report 1.1.-31.3.20

Containerships plc    Stock Exchange Release 16 May 2018 at 9.00 am EEST

Containerships plc’s interim report 1.1.-31.3.2018

Key figures: Growth continues

- Net sales EUR 62.6 (EUR 55.7) million - EBITDA EUR 4.0 (EUR 3.5) million - Net profit EUR 0.5 million (EUR 0.6) million - Outlook for 2018 remains unchanged: Net sales is estimated to grow approximately 10 % and EBITDA will improve from previous year.

Market conditions and significant events

CONTAINERSHIPS is a full-service logistics company providing safe and fast container transportation in the Baltic Sea, North Sea and the Mediterranean. Containerships offers both standard and customised containers and variable logistics solutions from door to door. During the reporting period, Baltic Sea and North Sea traffic accounted for around 89% of net sales and the Mediterranean for around 11% of net sales.

There were no significant changes in the operational environment during the first quarter of 2018. The Russian market has remained challenging due to economic sanctions and country’s overall economic situation. United Kingdom’s Brexit decision has not impacted the group’s business. No significant changes are estimated to occur in the operating environment in the near future.

The group continues to progress on its chosen investment track based on its environmentally friendly LNG strategy. Building of the LNG vessels has started numbering four in total, of which three will be delivered to the group during 2018 and the fourth in the beginning of 2019. The group has increased the number of LNG-fuelled trucks in Great Britain and is exploring the possibilities to increase the number of LNG-fuelled trucks also in the Netherlands and Finland.

In the Mediterranean region, the group’s own business activities in Algeria have continued in positive way. Business in Libya is being developed in partnership with local agents.

Result

The group’s net sales for the first quarter were EUR 62.6 (EUR 55.7) million, up 12.4% year on year. Business volume in Baltic Sea and in North Sea grew approximately 16 %.

Despite the challenging market conditions and competition in the Mediterranean, the group succeeded to grow business volume by 23 % and the price levels went up in the end of the quarter. Group developed its operations to better respond to customer needs in the Mediterranean. Thanks to the measures introduced, the group sees that the positive trend in sales will continue in the Mediterranean for the 2018. In Tunisia group will open new joint venture with local partner during Q2/2018.

Operating profitability improved in the first quarter: EBITDA showed an improvement of EUR 0.5 million and operating profit an improvement of EUR 0.9 million compared to the previous year’s first quarter. EBITDA for the first quarter was EUR 4.0 million, equating to 6.4% of net sales (EUR 3.5 million, 6.3%). Operating profit was EUR 2.3 million, equating to 3.6% of net sales (EUR 1.4 million, 2.5%). Profitability improved on the back of better utilisation rates, driven mostly by operational efficiency measures and the positioning of empty containers. On the other hand, the rise in the price of oil on the global market and higher fuel costs increased operating costs, which eroded profitability.

Net profit for the first quarter was EUR 0.5 (EUR 0.6) million. Financial costs increased mostly due to currency rate of exchange by EUR 0.6 million and therefore the net result at previous year’s first quarter level. Part of the interest costs on the bond have been capitalised in the cost of building the ships in accordance with general practice since the prepayments for the vessels were made in October 2016. The equity stated in the IFRS report does not include a capital loan of around EUR 6.1 million. Adjusted equity is EUR 26.3 million, whereas in the IFRS calculation it is EUR 20.2 million.

The group’s operational cash flow was better than a year earlier and was EUR 1.7 (EUR -3.4) million.

Most significant risks looking ahead

The most significant risks in Containerships’ business relate to fluctuations in the price of oil and to political uncertainty in the Russian and Turkish markets. Risks and risk management are detailed on the group’s website and in the financial statements. The group does not consider there to have been any material changes in risks during the reporting period.

Outlook

EBITDA for the first quarter was, as estimated, better than a year earlier and EBITDA for the full year is also expected to improve on the previous year.

Work will continue on improving operating efficiency. Efforts will be made to develop sales work by focusing on those segments and regions where growth can be captured and by further improving efficiency especially in those regions. The group does not expect any major changes in market conditions. The challenging situation in the Mediterranean is expected to continue.

Work on building the LNG vessels is underway and delivery of three will take place in 2018 and fourth in beginning 2019. In addition, the group will continue to focus on developing LNG-fuelled truck traffic.

Containerships plc will as earlier communicated publish its Q2/2018 interim report on 16 August 2018.

Containerships plc’s bond totalling EUR 60.0 million issued on 2 April and 28 October 2015 has been listed on Nasdaq Helsinki since 2 April 2015.

Further information:

CEO, Kari-Pekka Laaksonen, phone +358 50 550 2555, kari-pekka.laaksonen(at)containerships.fi

Distribution: NASDAQ OMX Helsinki www.containershipsgroup.com

Containerships plc has reported its results in accordance with IFRS accounting principles since the start of 2016. Interim reports are prepared in accordance with IFRS accounting principles, but exclude the notes to the financial statements as required under IAS 34 Interim Financial Reporting. When preparing the interim report, the company has complied with the same accounting principles as in the IFRS financial statements for 2016. The information presented in this interim report is unaudited.

Attachment

• Stock release Q1_2018 Containerships plc Appendix 1