Market announcement

Title

AS Tallinna Sadam financial results for 2024 9 months and Q3

Message

Tallinna  Sadam earned 91 million euros in  sales revenue in 9 months, 2.5% more
than  a  year  earlier,  EBITDA  of  41 million euros increased by 5.4%, and the
profit  was 14.1% higher - 15 million euros.  Sales revenue in the third quarter
was  31 million euros (-0.7%), EBITDA 13 million euros (-1.7%) and profit nearly
6 million  euros (-6.5%). In  9 months, we  invested a  total of over 33 million
euros, including 8 million euros in the third quarter.

"The   results  of  the  third  quarter  in  terms  of  cargo  volumes  exceeded
expectations," comments Valdo Kalm, the Chairman of the Management Board. "Cargo
volumes  increased in all types, the number of passengers has also increased. We
are  especially pleased with the increase in the number of ship visits, both for
cargo  and passenger  ships, which  account for  the majority  of port operating
revenues.  Turnover  increased  both  in  ports  and ferries. Unfortunately, the
otherwise  good results  were affected  by Botnica's  technical failure,  due to
which  the cooperation with  BP Exploration Operating  Company Ltd ended earlier
than  expected. However,  the execution  of the  new contract in Northern Canada
started  on  time.  In  September,  we  signed  an agreement for operating ferry
services between the mainland and the largest islands until 2033, which in long-
term  perspective ensures stability and sustainability in our field of shipping.
Also,  we are optimistic about the  development of renewable energy projects and
related negotiations in the ports of Muuga and Paldiski."

In  9 months,  the  number  of  passengers  increased by 3.2% (4.3% in the third
quarter)  and cargo volumes by  2.0% (7.2% in the third  quarter), the number of
ship  visits  increased  by  0.4% (5.9%  in  the  third  quarter).  In shipping,
passenger  ferries showed stable growth -  the number of passengers increased by
1.6% (1.4% in the third quarter) and the number of vehicles by 3.0% (3.0% in the
third  quarter).  Chartering  days  of  Botnica  decreased  by  58% in the third
quarter,  while in  9 months they  remained at  a similar  level to the previous
year.

Tallinna  Sadam management  will present  the financial  results of the Group at
webinars  on 11 November, including webinar in Estonian starting at 10.00 (EEST)
(link       to      EST      webinar      (https://teams.microsoft.com/l/meetup-
join/19%3ameeting_ZDJiMTQ3NmItMjJlYS00MzhkLWEzOWYtOTU1ZjNjMDM3YjUw%40thread.v2/0
?context=%7b%22Tid%22%3a%223c572f71-c808-4685-aa00-
2ca59a11c7e2%22%2c%22Oid%22%3a%2216aaa10d-0f16-4312-8940-581f83498a0b%22%7d))
and   webinar   in  English  starting  at  11.00 (EEST)  (link  to  ENG  webinar
(https://teams.microsoft.com/l/meetup-
join/19%3ameeting_MzkyMDMwY2YtY2I5Ni00MjM5LTg3NGYtYjgwNTMxMzc4ZThh%40thread.v2/0
?context=%7b%22Tid%22%3a%223c572f71-c808-4685-aa00-
2ca59a11c7e2%22%2c%22Oid%22%3a%2216aaa10d-0f16-4312-8940-581f83498a0b%22%7d)).

Materials related to the interim report can be found attached to this notice and
on our website: https://www.ts.ee/en/investor/interim-reports/
https://www.ts.ee/en/investor/presentations/.

Key figures (in million EUR):

                              Q3      Q3     +/-      9M      9M      +/-

                            2024    2023       %    2024    2023        %

  Revenue                   31.2    31.4   -0.7%    90.8    88.6     2.5%

  Adjusted EBITDA           13.3    13.5   -1.7%    40.9    38.8     5.4%

  Adjusted EBITDA margin   42.6%   43.0%    -0.4   45.0%   43.8%      1.2

  Operating profit           7.3     7.4   -2.4%    23.2    20.0    16.0%

  Income tax                 0.0     0.0     0.0     3.1     3.0     4.7%

  Profit for the period      5.6     6.0   -6.5%    14.9    13.0    14.1%

  Investments                8.4     4.8     0.8    33.5    10.9   206.9%


                          30.09.2024   31.12.2023     +/-

  Total assets                 613.0        606.2    1.1%

  Interest bearing debt        183.7        173.4    5.9%

  Other liabilities             56.0         55.1    1.6%

  Equity                       373.3        377.7   -1.2%

  Number of shares             263.0        263.0    0.0%

Major events in Q3:

  * Conclusion of the ferry service contract for the period 2026-2033
  * EU funding for the joint project of the ports of Tallinn and Helsinki TWIN-
    PORT VI
  * The offshore contract of the icebreaker Botnica with BP Exploration
    Operating Company Ltd ended earlier than planned
  * Aditional trips of passenger ferry Regula in the summer of 2024
  * Appeal to the judgment regarding the former managers of the Port of Tallinn
  * Termination of OÜ MPG AgroProduction restructuring proceedings and
    continuation of the bankruptcy process
  * Signing an unsecured loan agreement with Swedbank

Revenue
Revenue for nine months increased by EUR 2.2 million (+2.5%) year on year to EUR
90.8 million,  supported by higher charter fees from the icebreaker MSV Botnica,
higher  revenue from  ferry service  between Estonia's  mainland and two largest
islands, higher revenue from other services and higher lease income. In terms of
revenue  streams, the largest increase  in the first nine  months was in charter
fees, which grew by EUR?0.8 million (+8.9%) to EUR 9.5 million. Despite the fact
that  the icebreaker MSV Botnica had fewer charter days in the first nine months
of  this year, charter  fees increased due  to the projects'  higher charter fee
rate  per day. In the third quarter, charter fee revenue decreased year on year,
because  the  charter  period  was  shorter  due  to technical problems with the
vessel.  Ferry service5  revenue grew  by EUR  0.6 million (+2.2%)  to EUR 27.8
million,  mainly due to higher government support  as a result of the indexation
of  the fees. The number  of trips did not  change significantly compared to the
previous  year (+0.8%). Revenue from other  services grew by EUR?0.4 million due
to  the commissioning of the LNG quay in Pakrineeme Harbour this year and higher
revenue from the sale of advertising space in Old City Harbour and the provision
of  catering services on  the icebreaker MSV  Botnica. Lease income increased by
EUR  0.3 million  (+3.1%)  to  EUR  10.7 million.  Lease  income improved in all
segments, but particularly in the Cargo harbours and Passenger harbours segments
due  to the  indexation of  lease payments  and fees  for right  of superficies.
Passenger  fee revenue increased by EUR  0.3 million (+3.1%) to EUR 9.2 million,
in  line with the rise in passenger numbers (+3.2%). Electricity revenue grew by
EUR  0.2 million (+7.3%) to  EUR?3.4 million, supported  by higher sales volumes
and   prices  for  network  services.  In  addition,  both  on-shore  and  other
electricity  consumption increased.  Vessel dues  revenue decreased  by EUR 0.2
million  (-1.0%) to EUR  23.9 million due to  fewer calls by  large tankers. The
number  of  cruise  ship  calls  increased,  but  their lower GT (gross tonnage)
resulted  in lower revenue from tonnage charges. Cargo charges revenue decreased
by EUR 0.2 million (-3.5%) to EUR 4.5 million. Although cargo volumes increased,
cargo  charges revenue  decreased, partly  because cargo  charges from operators
whose  cargo charges depend on full-year  forecast cargo volumes are adjusted in
accordance  with IFRS 15. In  the first nine  months of 2023, the adjustments to
cargo charges were higher than in the same period this year.

EBITDA
Adjusted  EBITDA for nine months grew by EUR 2.1 million (+5.4%) year on year to
EUR  40.9 million.  Adjusted  EBITDA  grew  in  the  Cargo harbours segment, the
segment Other and the Passenger harbours segment. In the Ferry segment, adjusted
EBITDA  decreased. The adjusted EBITDA of the Cargo harbours segment improved as
operating  expenses (particularly repair costs) decreased and revenue increased.
The  improvement in the  adjusted EBITDA of  the segment Other  was supported by
revenue  growth, which exceeded the growth  in operating and personnel expenses.
Adjusted  EBITDA for the third quarter decreased by EUR 0.2 million (-1.7%) year
on  year, because the decrease in the segment Other exceeded the combined growth
in  other segments.  Adjusted EBITDA  margin for  nine months rose from 43.8% to
45.0% and  adjusted EBITDA  margin for  the third  quarter dropped from 43.0% to
42.6%.

Profit
Profit  before tax for nine months grew by EUR 2.0 million (+12.4%) year on year
to EUR 18.0 million. Profit grew less than operating profit because the increase
in  finance costs (net) (+EUR 1.3 million)  exceeded the increase in profit from
the  equity-accounted associate AS Green Marine (+EUR 0.1?million). The dividend
declared  in the second  quarter of 2024 in  an amount of  EUR 19.2 million gave
rise  to income tax expense of EUR 3.1 million, which was EUR 0.1 million larger
than the income tax expense on the dividend distributed last year. The amount of
the dividend did not change, but last year income tax expense was reduced by the
reversal  of deferred tax of  EUR 0.1 million. Profit for  the first nine months
increased by EUR?1.8 million (+14.1%) year on year. Third-quarter profit was EUR
5.6 million (-EUR 0.4 million, -6.5%).

Investments
In the first nine months of 2024, the Group invested EUR 33.5 million, EUR 22.6
million  more than in the same period  last year. The largest investments of the
period were made in the construction of a quay in Paldiski South Harbour for the
provision  of maintenance and construction services  to offshore wind farms, the
reconstruction  of a quay in Muuga Harbour, the reconstruction of a quay ramp in
Old  City Harbour, the development of information systems, technical design, the
regular dry-docking of a ferry and the purchase of equipment for ferries. In the
third  quarter,  investments  totalled  EUR  8.4 million (EUR 4.8 million in the
third quarter of 2023).

Interim condensed consolidated statement of financial position:

  In thousands of euros           30 September 2024   31 December 2023
-----------------------------------------------------------------------
  ASSETS



  Current assets

  Cash and cash equivalents                  22 079             29 733

  Trade and other receivables                11 501             12 118

  Contract assets                               417                  0

  Inventories                                   330                550

  Total current assets                       34 327             42 401


-----------------------------------------------------------------------
  Non-current assets

  Investments in associates                   2 667              2 177

  Other long-term receivables                     0                163

  Investment properties                      14 069             14 069

  Property, plant and equipment             559 727            545 271

  Intangible assets                           2 229              2 083

  Total non-current assets                  578 692            563 763
-----------------------------------------------------------------------
  Total assets                              613 019            606 164
-----------------------------------------------------------------------




  LIABILITIES



  Current liabilities

  Loans and borrowings                       12 561             15 831

  Provisions                                  1 153              1 311

  Government grants                           7 612              7 344

  Taxes payable                               1 413                876

  Trade and other payables                    9 303              9 429

  Contract liabilities                        1 737                 63

  Total current liabilities                  33 779             34 854
-----------------------------------------------------------------------


  Non-current liabilities

  Loans and borrowings                      171 183            157 566

  Government grants                          31 881             33 075

  Other payables                                107                255

  Contract liabilities                        2 740              2 755

  Total non-current liabilities             205 911            193 651
-----------------------------------------------------------------------
  Total liabilities                         239 690            228 505
-----------------------------------------------------------------------
  EQUITY

  Share capital at par value                263 000            263 000

  Share premium                              44 478             44 478

  Statutory capital reserve                  23 304             22 858

  Retained earnings                          42 547             47 323

  Total equity                              373 329            377 659
-----------------------------------------------------------------------
  Total liabilities and equity              613 019            606 164
-----------------------------------------------------------------------

Interim condensed consolidated statement of profit or loss:



 In thousands of euros                         Q3 2024  Q3 2023 9M 2024 9M 2023
-------------------------------------------------------------------------------


 Revenue                                        31 214   31 426  90 797  88 615

 Other income                                      398      371   1 164   1 231

 Operating expenses                            -11 651  -11 507 -30 951 -31 171

 Impairment of financial assets                   -214     -403    -680    -806

 Personnel expenses                             -6 302   -6 254 -18 661 -18 229

 Depreciation, amortisation and impairment      -6 087   -6 129 -18 207 -19 356

 Other expenses                                    -90      -55    -262    -280

 Operating profit                                7 268    7 449  23 200  20 004


-------------------------------------------------------------------------------
 Finance income and costs

 Finance income                                    203      330     703     916

 Finance costs                                  -2 158   -2 073  -6 400  -5 303

 Finance costs - net                            -1 955   -1 743  -5 697  -4 387
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
 Share of profit of an associate accounted
 for under the equity method                       265      258     491     396

 Profit before income tax                        5 578    5 964  17 994  16 013
-------------------------------------------------------------------------------


 Income tax                                          0        0  -3 125  -2 985

 Profit for the period                           5 578    5 964  14 869  13 028
-------------------------------------------------------------------------------
 Attributable to owners of the Parent            5 578    5 964  14 869  13 028
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
 Basic and diluted earnings per share (in
 euros)                                           0.02     0.02    0.06    0.05
-------------------------------------------------------------------------------

Interim condensed consolidated statement of cash flows:



  In thousands of euros                                  9M 2024   9M 2023
---------------------------------------------------------------------------


  Cash receipts from sale of goods and services           99 181    94 692

  Cash receipts related to other income                       42       247

  Payments to suppliers                                  -37 612   -38 900

  Payments to and on behalf of employees                 -17 787   -18 511

  Payments for other expenses                               -224      -253

  Income tax paid on dividends                            -3 325    -3 264

  Cash from operating activities                          40 275    34 011


---------------------------------------------------------------------------
  Purchases of property, plant and equipment             -33 118   -10 063

  Purchases of intangible assets                            -479      -627

  Proceeds from sale of property, plant and equipment         17        28

  Dividends received                                           0       357

  Interest received                                          679       875

  Cash used in investing activities                      -32 901    -9 430
---------------------------------------------------------------------------
  Proceeds from loans received                            20 000         0

  Repayments of loans received                            -9 583    -7 383

  Dividends paid                                         -19 000   -19 012

  Interest paid                                           -6 427    -4 654

  Other payments related to financing activities             -18        -7

  Cash from/used in financing activities                 -15 028   -31 056
---------------------------------------------------------------------------
  NET CASH FLOW                                           -7 654    -6 475
---------------------------------------------------------------------------
  Cash and cash equivalents at beginning of the period    29 733    44 387

  Change in cash and cash equivalents                     -7 654    -6 475

  Cash and cash equivalents at end of the period          22 079    37 912
---------------------------------------------------------------------------

Tallinna Sadam is one of the largest cargo- and passenger port complexes in the
Baltic Sea region. In addition to passenger and freight services, Tallinna Sadam
group also operates in shipping business via its subsidiaries - OÜ TS Laevad
provides ferry services between the Estonian mainland and the largest islands,
and OÜ TS Shipping charters its multifunctional vessel Botnica for icebreaking
and offshore services in Estonia and projects abroad. Tallinna Sadam group is
also a shareholder of an associate AS Green Marine, which provides waste
management services.

Additional information:

Andrus Ait
Chief Financial Officer
Tel. +372 526 0735
[email protected] (mailto:[email protected])