Half-yearly report
August 30 2011 - 2:00AM
UK Regulatory
TIDMICGC
HALF YEARLY FINANCIAL REPORT
FOR THE SIX MONTHS ENDED 30 JUNE 2011
+----------------------+-------------------------+----------+----------------+
| | Unaudited | | Audited |
+----------------------+-------------------------+----------+----------------+
| Financial Highlights | Six months to 30th June | Change % | Financial Year |
+----------------------+---------+---------------+----------+----------------+
| | 2011 | 2010 | | 2010 |
+----------------------+---------+---------------+----------+----------------+
| Revenue | EUR126.6m | EUR122.4m | +3.4% | EUR262.2m |
+----------------------+---------+---------------+----------+----------------+
| EBITDA | EUR16.1m | EUR20.0m | -19.5% | EUR53.6m |
+----------------------+---------+---------------+----------+----------------+
| Operating Profit | EUR6.5m | EUR8.8m | -26.1% | EUR31.5m* |
+----------------------+---------+---------------+----------+----------------+
| EPS Basic | 24.4c | 33.1c | -26.3% | 156.8c |
+----------------------+---------+---------------+----------+----------------+
| EPS Adjusted | 24.0c | 34.3c | -30.0% | 121.0c |
+----------------------+---------+---------------+----------+----------------+
| Net Debt | EUR14.4m | EUR26.9m | -46.5% | EUR6.3m |
+----------------------+---------+---------------+----------+----------------+
| Dividend | 33.0c | - | | 100.0c |
+----------------------+---------+---------------+----------+----------------+
Other Key Points
+--------------------------+---------------+---------------+--------+
| | 30th Jun 2011 | 30th Jun 2010 | % |
+--------------------------+---------------+---------------+--------+
| | 000 | 000 | |
+--------------------------+---------------+---------------+--------+
| Passengers | 670.5 | 695.7 | -3.6% |
+--------------------------+---------------+---------------+--------+
| Cars | 151.6 | 156.4 | -3.1% |
+--------------------------+---------------+---------------+--------+
| RoRo Freight | 97.0 | 86.6 | +12.0% |
+--------------------------+---------------+---------------+--------+
| Container Freight (teu.) | 205.3 | 210.6 | -2.5% |
+--------------------------+---------------+---------------+--------+
| Port Lifts | 94.2 | 82.3 | +14.5% |
+--------------------------+---------------+---------------+--------+
teu = twenty foot equivalent units
* excludes non trading credit
Comment
In a comment John B. McGuckian Chairman stated;
"I am pleased to report EBITDA of EUR16.1m in the first six months of the year.
These are resilient results in the context of a challenging economic environment
and high oil prices. The Group fuel bill was EUR24.4 million compared with EUR20.1
million in the first half of 2010. Last year we had the benefit of the ash cloud
which makes comparison with 2011 even more challenging. On the RoRo freight side
there has been good growth in our business, up 12% in volume terms and cash
generation remains strong with net debt of only EUR14.4 million having paid a
dividend of EUR25.1 million during June. We have also declared an interim dividend
of 33.0 cent per ICG unit. The economic outlook remains challenging with
austerity programmes affecting both consumer demand for travel and freight
markets but we are structured to compete and to continue to generate cash
notwithstanding this backdrop".
30th August 2011
Enquiries: Eamonn Rothwell Tel: +353-1-607 5628
Garry O'Dea Tel: +353-1-607 5628
Email: info@icg.ie
Website: www.icg.ie
INTERIM MANAGEMENT REPORT
FOR THE SIX MONTHS TO 30 JUNE 2011
RESULTS
The Board of Irish Continental Group plc (ICG) reports that, in the seasonally
less profitable first half of the year, the Group recorded revenue of EUR126.6
million compared with EUR122.4 million in the same period in 2010, an increase of
3.4%. Earnings before interest tax and depreciation (EBITDA) were EUR16.1 million
compared with EUR20.0 million in the same period in 2010. Operating profit was
EUR6.5 million compared with EUR8.8 million in 2010. Group fuel costs were EUR24.4
million compared with EUR20.1 million in the same period in 2010. There was a net
finance charge of EUR0.3 million which includes a net pension credit of EUR0.1
million and net bank interest payable of EUR0.4 million. Profit before tax was
EUR6.2 million compared with EUR8.3 million in the first half of 2010. The tax
charge amounted to EUR0.1 million (2010: EUR0.1 million). Basic EPS was 24.4c
compared with 33.1c in the first half of 2010. Adjusted EPS (i.e. before the net
pension interest credit) amounted to 24.0c (34.3c in 2010).
DIVIDEND
The Board has decided to resume payment of an interim dividend and declares a
dividend of 33.0 cent per ICG unit payable on 30 September to shareholders on
the register at 16 September 2011.
OPERATIONAL REVIEW
Ferries Division
The division comprises Irish Ferries, a leading provider of passenger and
freight ferry services between Ireland and both the UK and Continental Europe,
and the bareboat chartering of multipurpose ferries to third parties. Irish
Ferries operated 2,148 sailings in the period, down 1.8% on 2010.
Revenue in the division was EUR68.2 million (2010: EUR68.0 million) with higher
passenger car and freight revenue offset by lower foot passenger and charter
revenue. Profit from operations was EUR3.2 million (2010: EUR6.5 million), after a
EUR3.1 million increase in fuel costs.
Irish Ferries' passenger business is focused on passengers travelling with their
own cars. Total passengers carried were down 3.6% at 670,500 while total cars
carried in the first half of 2011 were 151,600, down 3.1% on the previous year,
but at higher yields. The overall sea passenger market was down 7.5% and the car
market was down 6.2%. (The comparative figures for 2010 include the period
during which European air space was closed due to volcanic ash, which had a
significant positive impact on passenger volumes in that period).
In RoRo freight Irish Ferries' volumes were up 12.0% to 97,000 units, when
compared with the first half of 2010. This increase is in excess of the market
due to reduced capacity on the Central Corridor of the Irish Sea. On the Island
of Ireland as a whole RoRo volumes were flat year-on-year (source: Irish
Maritime Development Office - IMDO) indicating that economic recovery is still
some way off.
The MV Kaitaki remained on charter to P&O during the period, trading in New
Zealand.
INTERIM MANAGEMENT REPORT
FOR THE SIX MONTHS TO 30 JUNE 2011
OPERATIONAL REVIEW - continued
Container and Terminal Division
The Container and Terminal Division includes the shipping lines Eucon and
Feederlink as well as the division's strategically located container terminals
in Dublin (DFT) and Belfast (BCT).
Turnover in the division was up 7.3% to EUR59.1 million (2010: EUR55.1 million),
while profit from operations was EUR3.3 million (2010: EUR2.3 million).
Total containers shipped were down 2.5% at 205,300 teu. There was an increase in
carryings to and from Ireland offset by a reduction in carryings on the North
Sea due to business foregone due to inadequate rates. There was strong growth in
the number of units lifted at the division's port facilities in Dublin and
Belfast which were up 14.5% at 94,200 lifts. The overall LoLo market on the
island of Ireland was down 1% in the first six months of the year (source:
IMDO).
FINANCE / DEBT
EBITDA for the period was EUR16.1 million compared with EUR20.0 million in the same
period in 2010. Operating cash flow was EUR14.2 million versus EUR16.8 million in
2010. Capital expenditure in the period was EUR3.7 million (2010: EUR4.6 million)
while pension payments in excess of current service costs amounted to EUR2.2
million. Free cash flow was EUR19.4 million compared with EUR18.8 million in the
previous half year. During the period we returned EUR29.1m to shareholders
comprising, a dividend of 100 cent per ICG Unit totalling EUR25.1 million (2010
EUR25.0 million) and EUR4.0 million through a share buyback.
Net debt at the end of the period amounted to EUR14.4 million. This compares with
EUR6.3 million at 31 December 2010 and reflects the payment of the dividend of
EUR25.1 million and the EUR4.0 million share buyback offset to a large degree by the
strong operating cash flow.
PRINCIPAL RISKS AND UNCERTAINTIES
The Group has a risk management structure in place which is designed to
identify, manage and mitigate the threats to the business. The key risks facing
the Group in the six months to 31 December 2011 include operational risks such
as risks to safety and business continuity, commercial and market risks due to
reduced demand for passenger and freight services combined with the risk of
increased supply of shipping capacity due to the mobility of assets, and
financial and commodity risks arising from the current financial and economic
environment.
* Safety and Business Continuity
The Group is dependent on the safe operation of its vessels. There is a risk
that any of the Group's vessels could be involved in an incident which could
cause loss of life and cargo and cause significant interruption to the Group's
business. In mitigation, the Group carries insurance in respect of passenger,
cargo and third party liabilities, but does not carry insurance for business
interruption due to the cost involved relative to the insurable benefits. The
operation of vessels of the type listed by the Group is subject to significant
regulatory oversight by flag state, port state and other regulatory authorities
whose requirements can change from time to time. The business of the Group is
also exposed to the risk of interruption from incidents such as mechanical
failure or other loss of critical port installations or vessels or from labour
disputes either within the Group or in key suppliers, for example ports or fuel
suppliers, or from a loss of significant IT systems.
INTERIM MANAGEMENT REPORT
FOR THE SIX MONTHS TO 30 JUNE 2011
PRINCIPAL RISKS AND UNCERTAINTIES - continued
* Commercial and Market Risk
The passenger market is subject to the current challenging economic conditions,
the propensity of consumers to spend and travel and to the competitive threat
from short-haul and regional airlines.
The freight market is subject to general economic conditions and in particular
the changes in the level of international trade in North West Europe. Given the
mobile nature of ships there is also the risk of additional capacity arising in
any of the Group's trading areas at relatively short notice. The Group has
commercial arrangements with freight customers and the Group is exposed to the
risk of loss of such customers.
* Financial and Commodity Risks
In the light of the challenges arising in financial markets there is a higher
degree of financial risk in the business. Specific risks include higher risk of
default by debtors, reduced availability of credit insurance and potentially
reduced availability, and higher cost, of financing. Other financial risks
include the risks to the Group's defined benefit pension schemes from changes in
interest and inflation rates, longevity, and changes in the market value of
investments. In addition to normal risks attributable to the Group's defined
benefit pension schemes, the Group is exposed to risk attributable to its
membership of the multi-employer scheme, the Merchant Navy Officer Pension Fund
(MNOPF). The rules of the scheme provide for joint and several liability for
employers for the obligations of the scheme which had a deficit of approximately
GBP361 million sterling at 31 March 2010. This means the Group is exposed, with
other performing employers, to a pro rata share of the obligations of any
employers who default on their obligations. The Group is also exposed to the
risk of a discontinuance basis debt arising (a "S 75 debt") if it ceases
participation in the MNOPF. This would be a larger sum than the ongoing deficit
share and represents a contingent liability. In terms of commodity price risk
the Group's vessels consume heavy fuel oil (HFO), marine diesel gas oil
(MDO/MGO) and lubricating oils, all of which continue to be subject to price
volatility. It is the Group's policy to purchase these commodities in the spot
markets and to remain unhedged.
RELATED PARTY TRANSACTIONS
There were no related party transactions in the half year that have materially
affected the financial position or performance of the Group in the period. In
addition, there were no changes in related party transactions from the last
annual report that could have a material effect on the financial position or
performance of the Group in the first six months.
GOING CONCERN
After making enquiries and taking into account the Group's committed banking
facilities which extend to August 2013, the Directors believe that the Group has
adequate resources to continue in operational existence for the foreseeable
future. In forming this view the Directors have considered the future cash
requirements of the Group's business in the context of the economic environment
over the next 12 months, the principal risks and uncertainties facing the Group,
the Group's budget plan and the medium term strategy of the Group, including
capital investment plans. The future cash requirements have been compared to
bank facilities which the Directors have negotiated. For this reason, they
continue to adopt the going concern basis in preparing this half yearly
financial report.
INTERIM MANAGEMENT REPORT
FOR THE SIX MONTHS TO 30 JUNE 2011
AUDITOR REVIEW
This half yearly financial report has not been audited or reviewed by the
auditors of the Group pursuant to the Auditing Practices Board guidance on
Review of Interim Financial Information.
CURRENT TRADING
The economic backdrop remains weak with subdued consumer demand in both Ireland
and the UK. The Irish Government's initiative to stimulate the hospitality
industry through lower V.A.T took effect from 1 July and is a welcome
development but has yet to show a demonstrable improvement in incoming tourists
by sea. In July and August car volumes were down 7%, total passenger numbers
were in line with 2010 and RoRo freight was up 3%. The RoRo freight market is
somewhat weaker than we had expected, although in the Container and Terminal
division our container volumes have increased by 9% in the last two months while
port lifts are up 12% continuing the strong trend from the first half. Oil
prices continue to remain at historically high levels.
As we stated in our interim management statement on 17 May 2011, the greatest
threat to our financial performance this year is the very significant increase
in our fuel cost, following on from the EUR10 million increase in our fuel bill in
2010. We were successful last year in passing on that increase in that financial
year. However given the scale of the back-to-back increase in 2011, it will be a
significant challenge to pass on all of this increase in the remainder of the
current financial year, if oil remains at current price levels. Notwithstanding
the current difficult economic backdrop we are confident of passing on fuel cost
increases through the cycle, as has been successfully proven by our business
model in the past.
FORWARD LOOKING STATEMENTS
This report contains certain forward-looking statements and these statements are
made by the Directors in good faith based on the information available to them
up to the time of their approval of this report and those statements should be
treated with caution due to the inherent uncertainties, including both economic
and business risk factors, underlying any such forward looking information.
This report has been prepared for the Group as a whole and therefore gives
greater emphasis to those matters which are significant to Irish Continental
Group plc and its subsidiaries when viewed as a whole.
Website
This half yearly financial report and Interim Management Report are available on
the Group's websitewww.icg.ie.
John B. McGuckian
Chairman
30th August 2011
INVESTOR PRESENTATION
The Company will make a presentation of the results to investors. The
presentation will be held at the offices of NCB Stockbrokers at 3 George's Dock,
IFSC, Dublin 1 at 8.00 a.m. on 30th August 2011. In addition, a dial-in facility
will be available. Attendance at the presentation and dial-in will be strictly
limited to investors who register in advance to attend. To register to attend
the presentation, either in person or via the dial-in facility, investors should
contact NCB Stockbrokers at +353 (0)1 611 5942. A copy of the presentation will
also be posted on the Company's web-site,www.icg.ie
RESPONSIBILITY STATEMENT
The Directors are responsible for preparing the Half Yearly Financial Report in
accordance with the Transparency (Directive 2004/109/EC) Regulations 2007, the
related Transparency Rules of the Irish Financial Services Regulatory Authority
and IAS 34, Interim Financial Reporting as adopted by the European Union.
The Directors confirm that, to the best of their knowledge:
* the Group Condensed Financial Statements for the half year ended 30 June
2011 have been prepared in accordance with the International Accounting
Standard applicable to interim financial reporting (IAS 34 Interim Financial
Reporting) adopted pursuant to the procedure provided for under Article 6 of
the Regulation (EC) No. 1606/2002 of the European Parliament and the Council
of 19 July 2002;
* the Interim Management Report includes a fair review of the important events
that have occurred during the first six months of the financial year, their
impact on the Group Condensed Financial Statements for the half year
ended 30 June 2011, and a description of the principal risks and
uncertainties for the remaining six months; and
* the Interim Management Report includes a fair review of related party
transactions that have occurred during the first six months of the current
financial year and that have materially affected the financial position or
the performance of the Group during that period, and any changes in the
related parties transactions described in the last Annual Report that could
have a material effect on the financial position or performance of the Group
in the first six months of the current financial year.
Eamonn Rothwell Chief Executive Officer
Garry O'Dea Finance Director
30th August 2011
CONDENSED CONSOLIDATED INCOME STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2011
Unaudited Unaudited Audited
30 Jun 30 Jun 31 Dec
2011 2010 2010
Notes EURm EURm EURm
Continuing operations
Revenue 126.6 122.4 262.2
Depreciation and amortisation (9.6) (11.2) (22.1)
Employee benefits expense (8.2) (11.2) (24.0)
Other operating expenses (102.3) (91.2) (184.6)
6.5 8.8 31.5
Non trading credit - - 9.4
Operating profit 6.5 8.8 40.9
Investment revenue 6.1 6.7 11.6
Finance costs (6.4) (7.2) (12.4)
Profit before taxation 6.2 8.3 40.1
Income tax expense (0.1) (0.1) (1.1)
Profit for the period: all
attributable to equity holders of the
parent 6.1 8.2 39.0
Earnings per ordinary share (cent)
All from continuing operations
-basic 5 24.4c 33.1c 156.8c
-diluted 5 24.3c 32.9c 155.7c
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2011
Unaudited Unaudited Audited
30 Jun 30 Jun 31 Dec
2011 2010 2010
Notes EURm EURm EURm
Profit for the period 6.1 8.2 39.0
Cash flow hedges:
Fair value (losses) / gains arising
during the
period (0.3) - 0.1
Transfer to Consolidated Income
Statement -
net settlement of cash flow hedge 0.1 - -
Foreign exchange (losses) / gains on
translation of foreign operations (3.1) 8.2 3.7
Actuarial (loss) / gain on retirement
benefit
obligations 10 (3.5) (21.9) 5.9
Deferred tax credit / (expense) 0.7 (0.4) (0.5)
Foreign exchange gain / (loss) on
defined
benefit schemes 0.4 - (0.3)
Currency translation differences
recycled to
Consolidated Income Statement on
disposal of
vessel - - (0.8)
Other comprehensive (expense) /
income for the period (5.7) (14.1) 8.1
Total comprehensive income /
(expense) for the period: all
attributable to
equity holders of the parent 0.4 (5.9) 47.1
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2011
Unaudited Unaudited Audited
30 Jun 30 Jun 31 Dec
2011 2010 2010
Notes EURm EURm EURm
Assets
Non-current assets
Property, plant and equipment 6 184.3 226.8 194.0
Intangible assets 7 0.9 1.0 0.9
Long term receivable 22.0 - 23.4
Retirement benefit surplus 10 3.4 1.4 4.0
210.6 229.2 222.3
Current assets
Inventories 3.2 2.7 1.9
Trade and other receivables 39.9 32.1 33.6
Derivative financial instruments - - 0.1
Cash and cash equivalents 13.1 17.5 17.2
56.2 52.3 52.8
Total assets 266.8 281.5 275.1
Equity and liabilities
Equity
Share capital 16.7 16.8 16.8
Share premium 52.7 51.8 51.8
Other reserves (24.3) (15.6) (21.3)
Retained earnings 105.3 71.8 130.7
Equity attributable to equity holders 150.4 124.8 178.0
Non-current liabilities
Borrowings 26.9 2.7 22.8
Trade and other payables 1.0 - 1.1
Deferred tax liabilities 3.5 4.1 4.2
Provisions 0.4 0.5 0.3
Deferred grant 0.9 1.0 1.0
Retirement benefit obligation 10 21.7 47.2 21.5
54.4 55.5 50.9
Current liabilities
Borrowings 0.6 41.7 0.7
Derivative financial instruments 0.1 - -
Trade and other payables 58.0 56.5 41.6
Current tax liabilities 2.8 2.4 3.5
Provisions 0.4 0.5 0.3
Deferred grant 0.1 0.1 0.1
62.0 101.2 46.2
Total liabilities 116.4 156.7 97.1
Total equity and liabilities 266.8 281.5 275.1
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2011
Share Share Other Retained
Capital Premium Reserves Earnings Total
EURm EURm EURm EURm EURm
Balance at 1 January 2011 16.8 51.8 (21.3) 130.7 178.0
Profit for the period - - - 6.1 6.1
Other comprehensive expense - - (3.3) (2.4) (5.7)
Total comprehensive (expense) / income
for the period - - (3.3) 3.7 0.4
Share issue 0.1 - - - 0.1
Exercise of share options -
shares issued at premium - 0.9 - - 0.9
Share buyback (0.2) - 0.2 (4.0) (4.0)
Employee share options expense - - 0.1 - 0.1
Dividend payment (note 4) - - - (25.1) (25.1)
(0.1) 0.9 (3.0) (25.4) (27.6)
Balance at 30 June 2011 16.7 52.7 (24.3) 105.3 150.4
Analysed as follows:
Share capital 16.7
Share premium 52.7
Other reserves (24.3)
Retained earnings 105.3
150.4
Other Reserves comprise the following:
Share
Capital Options Hedging Translation
Reserve Reserve Reserve Reserve Total
EURm EURm EURm EURm EURm
Balance at 1 January 2011 2.2 1.5 0.1 (25.1) (21.3)
Other comprehensive expense - - (0.2) (3.1) (3.3)
Total comprehensive
expense for the period - - (0.2) (3.1) (3.3)
Employee share options
expense - 0.1 - - 0.1
Share buyback 0.2 - - - 0.2
0.2 0.1 (0.2) (3.1) (3.0)
Balance at 30 June 2011 2.4 1.6 (0.1) (28.2) (24.3)
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2010
Share Share Other Retained
Capital Premium Reserves Earnings Total
EURm EURm EURm EURm EURm
Balance at 1 January 2010 16.6 48.7 (23.9) 110.9 152.3
Profit for the period - - - 8.2 8.2
Other comprehensive income / (expense) - - 8.2 (22.3) (14.1)
Total comprehensive income / (expense)
for the period - - 8.2 (14.1) (5.9)
Share issue 0.2 - - - 0.2
Exercise of share options -
Shares issued at premium - 3.1 - - 3.1
Employee share options expense - - 0.1 - 0.1
Dividend payment (note 4) - - - (25.0) (25.0)
0.2 3.1 8.3 (39.1) (27.5)
Balance at 30 June 2010 16.8 51.8 (15.6) 71.8 124.8
Analysed as follows:
Share capital 16.8
Share premium 51.8
Other reserves (15.6)
Retained earnings 71.8
124.8
Other Reserves comprise the following:
Share
Capital Options Translation
Reserve Reserve Reserve Total
EURm EURm EURm EURm
Balance at 1 January 2010 2.2 1.9 (28.0) (23.9)
Other comprehensive income - - 8.2 8.2
Total comprehensive
income for the period - - 8.2 8.2
Employee share options
expense - 0.1 - 0.1
- 0.1 8.2 8.3
Balance at 30 June 2010 2.2 2.0 (19.8) (15.6)
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2010
Share Share Other Retained
Capital Premium Reserves Earnings Total
EURm EURm EURm EURm EURm
Balance at 1 January 2010 16.6 48.7 (23.9) 110.9 152.3
Profit for the year - - - 39.0 39.0
Other comprehensive income - - 3.0 5.1 8.1
Total comprehensive
income for the year - - 3.0 44.1 47.1
Employee share options expense - - 0.3 - 0.3
Share Issue 0.2 - - - 0.2
Exercise of share options-
shares issued at premium - 3.1 - - 3.1
Dividends - - - (25.0) (25.0)
Transferred to retained earnings on
exercise of share options - - (0.7) 0.7 -
0.2 3.1 2.6 19.8 25.7
Balance at 31 December 2010 16.8 51.8 (21.3) 130.7 178.0
Analysed as follows:
Share capital 16.8
Share premium 51.8
Other reserves (21.3)
Retained earnings 130.7
178.0
Other Reserves comprise the following:
Share
Capital Options Hedging Translation
Reserve Reserve Reserve Reserve Total
EURm EURm EURm EURm EURm
Balance at 1 January 2010 2.2 1.9 - (28.0) (23.9)
Other comprehensive income - - 0.1 2.9 3.0
Total comprehensive
income for the year - - 0.1 2.9 3.0
Employee share options expense - 0.3 - - 0.3
Transferred to retained earnings on
exercise of share options - (0.7) - - (0.7)
- (0.4) 0.1 2.9 2.6
Balance at 31 December 2010 2.2 1.5 0.1 (25.1) (21.3)
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 JUNE 2011
Unaudited Unaudited Audited
30 Jun 30 Jun 31 Dec
2011 2010 2010
Notes EURm EURm EURm
Net cash from operating activities 11 23.1 23.3 42.8
Cash flow from investing activities
Interest received - 0.1 0.1
Proceeds on disposal of property, plant
and
equipment - - 0.5
Net proceeds received on disposal of - - 1.6
vessel
Purchases of property, plant and (3.6) (4.5) (6.9)
equipment
Purchase of intangible assets (0.1) (0.1) (0.3)
Net cash used in investing activities (3.7) (4.5) (5.0)
Cash flow from financing activities
Dividend paid to equity holders of the (25.1) (25.0) (25.0)
Company
Repayments of borrowings (10.3) - (17.4)
Repayments of obligations under finance (0.5) (0.5) (0.8)
leases
Proceeds on issue of ordinary share 1.0 3.3 3.3
capital
Repurchase of ordinary share capital (4.0) - -
New bank loans raised 15.0 - -
Increase in bank overdrafts - 1.7 -
New finance leases raised - 2.5 2.3
Net cash used in financing activities (23.9) (18.0) (37.6)
Net (decrease) / increase in cash and (4.5) 0.8 0.2
cash equivalents
Cash and cash equivalents at the
beginning
of the period 17.2 17.0 17.0
Effect of foreign exchange rate changes 0.4 (0.3) -
Cash and cash equivalents at the end of
the period
Cash and cash equivalents 13.1 17.5 17.2
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE HALF YEAR ENDED 30 JUNE 2011
1. General Information
These condensed financial statements do not comprise the statutory accounts
within the meaning of Section 19 of the Companies (Amendment) Act 1986. The
summary financial statements for the year ended 31 December 2010, as presented
in this Interim Report, represent an abbreviated version of the Group's full
financial statements for that year. Those financial statements contained an
unqualified audit report without reference to any matters of emphasis and have
been filed with the Companies Registration Office in Ireland.
The interim figures included in the condensed financial statements for the six
months ended 30 June 2011 and the comparative amounts for the six months ended
30 June 2010 are unaudited.
2. Accounting policies
The Group Condensed Financial Statements for the six months ended 30 June 2011
have been prepared in accordance with the Transparency (Directive 2004/109/EC)
Regulations 2007, the related Transparency Rules of the Irish Financial Services
Regulatory Authority and with IAS 34 'Interim Financial Reporting' as adopted by
the European Union.
The accounting policies and methods of computation applied in preparing these
condensed financial statements are consistent with those set out in the Group
Annual Report for the financial year ended 31 December 2010, which is available
atwww.icg.ie.
The Group did not adopt any new International Financial Reporting Standards
(IFRS) or Interpretations in the period that had a material impact on the Group
Condensed Financial Statements for the half year.
At 30 June 2011, the following Standards and Interpretations have become
effective since our last Annual Report:
IFRS 1 (Amendment) First-time Adoption of International Financial Reporting
Standards (effective for accounting periods beginning on or after 1
July 2010 and 1 January 2011);
IFRS 3 (Amendment) Business Combinations (effective for accounting periods
beginning on or after 1 July 2010);
IFRS 7 (Amendment) Financial Instruments: Disclosures (effective for
accounting periods beginning on or after 1 January 2011);
IAS 1 (Amendment) Presentation of Financial Statements (effective for
accounting periods beginning on or after 1 January 2011);
IAS 24 (Revised) Related Party Disclosures (effective for accounting periods
beginning on or after 1 January 2011);
IAS 27 (Amendment) Consolidated and Separate Financial Statements (effective
for accounting periods beginning on or after 1 July 2010);
IAS 32 (Amendment) Financial Instruments: Presentation (effective for
accounting periods beginning on or after 1 February 2010);
IAS 34 (Amendment) Interim Financial Reporting (effective for accounting
periods beginning on or after 1 January 2011);
IFRIC 13 (Amendment) Customer Loyalty Programmes (effective for accounting
periods beginning on or after 1 January 2011);
IFRIC 14 (Amendment) Prepayments of a Minimum Funding Requirement (effective for
accounting periods beginning on or after 1 January 2011); and
IFRIC 19 Extinguishing Financial Liabilities with Equity Instruments (effective
for accounting periods beginning on or after 1 July 2010).
There have been no material change in estimates in these interim accounts based
on the estimates that have previously been made in the prior year interim
accounts to 30 June 2010 and the prior year financial statements to 31 December
2010.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE HALF YEAR ENDED 30 JUNE 2011
3. Segmental information: Analysis by class of business
Under IFRS 8: Operating Segments, the Group has determined that the operating
segments are (i) Ferries and (ii) Container and Terminal.
Unaudited Audited
6 months ended 12 months
ended
30 Jun 2011 30 Jun 2010 31 Dec 2010
Revenue Profit Revenue Profit Revenue Profit
EURm EURm EURm EURm EURm EURm
Ferries 68.2 3.2 68.0 6.5 153.7 24.5
Container and Terminal 59.1 3.3 55.1 2.3 109.8 7.0
Internal Revenue (0.7) - (0.7) - (1.3) -
Non trading credit - - - - - 9.4
Operating Profit - 6.5 - 8.8 - 40.9
Net Interest - Ferries - (0.3) - (0.4) - (0.7)
Net interest - Container
and Terminal - - - (0.1) - (0.1)
External Revenue / Profit 126.6 6.2 122.4 8.3 262.2 40.1
Revenue in the Group's Ferries Division is weighted towards the second half of
the year due to patterns of passenger demand.
There has been no material change in the share of total assets / liabilities
between segments from the share disclosed in the prior year financial statements
to 31 December 2010.
4. Dividend
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
30 Jun 2011 30 Jun 2010 31 Dec 2010
EURm EURm EURm
Dividend paid of 100c per ICG Unit 25.1 25.0 25.0
In June 2011 and June 2010 the Company paid a dividend of 100 cent per ICG unit.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE HALF YEAR ENDED 30 JUNE 2011
5. Earnings per share - all from continuing operations
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
30 Jun 2011 30 Jun 2010 31 Dec 2010
Cent Cent Cent
Basic earnings per share 24.4 33.1 156.8
Diluted earnings per share 24.3 32.9 155.7
Adjusted basic earnings per share 24.0 34.3 121.0
Adjusted diluted earnings per
share 23.9 34.1 120.2
The calculation of the basic and diluted earnings per share attributable to the
ordinary equity holders of
the parent is based on the following data:
Earnings EURm EURm EURm
Earnings for the purpose of basic
and diluted
earnings per share -
Profit for the period attributable
to equity holders of
the parent 6.1 8.2 39.0
Earnings for the purpose of
adjusted earnings per
share - Profit for the period
attributable to equity
holders of the parent 6.1 8.2 39.0
Effect of non trading credit - - (9.4)
Effect of expected return on
defined benefit pension
scheme assets (6.1) (6.6) (11.5)
Effect of interest on defined
benefit pension
scheme liabilities 6.0 6.9 12.0
Earnings for the purpose of
adjusted earnings per
share 6.0 8.5 30.1
Number of shares '000 '000 '000
Weighted average number of
ordinary shares for
the purpose of basic earnings per
share 25,002 24,761 24,874
Effect of dilutive potential
ordinary shares: Share
options 125 176 170
Weighted average number of
ordinary shares for
the purpose of diluted adjusted
earnings per share 25,127 24,937 25,044
The denominator for the purposes of calculating both basic and diluted earnings
per share has been adjusted to reflect shares issued during the period and
excludes treasury shares. The earnings used in both the adjusted basic and
diluted earnings per share have been adjusted to take into account the net
figure for the expected return on defined benefit pension scheme assets and the
interest on defined pension scheme liabilities. Management consider the adjusted
earnings per share calculation to be a better indication of the continuing
underlying performance of the Group.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE HALF YEAR ENDED 30 JUNE 2011
6. Property, plant and equipment
Passenger Plant and Land and
ships equipment Vehicles buildings Total
EURm EURm EURm EURm EURm
Cost
At 1 January 2011 286.7 56.2 2.1 25.6 370.6
Additions 3.1 0.1 0.4 - 3.6
Disposals (3.4) (1.0) (0.6) - (5.0)
Exchange differences (7.4) (0.2) - - (7.6)
279.0 55.1 1.9 25.6 361.6
At 30 June 2011
Accumulated depreciation
At 1 January 2011 134.8 32.9 1.5 7.4 176.6
Charge for period 7.7 1.5 0.2 0.2 9.6
Disposals (3.4) (1.1) (0.5) - (5.0)
Exchange differences (3.9) - - - (3.9)
135.2 33.3 1.2 7.6 177.3
At 30 June 2011
Net book amounts
At 1 January 2011 151.9 23.3 0.6 18.2 194.0
At 30 June 2011 143.8 21.8 0.7 18.0 184.3
At 30 June 2010 182.9 25.0 0.5 18.4 226.8
At 30 June 2011 the Group has entered into commitments to the value of EUR0.2
million (2010: EUR0.5 million) for the purchase of fixed assets.
7. Intangible Assets
Software
EURm
Cost
At 1 January 2011 8.4
Additions 0.1
At 30 June 2011 8.5
Amortisation
At 1 January 2011 7.5
Charge for the period 0.1
At 30 June 2011 7.6
Carrying amount
At 1 January 2011 0.9
At 30 June 2011 0.9
At 30 June 2010 1.0
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE HALF YEAR ENDED 30 JUNE 2011
8. Net debt
Cash Overdrafts Loans Leases Total
EURm EURm EURm EURm EURm
At 1 January 2011
Current assets 17.2 - - - 17.2
Creditors due within one year - - - (0.7) (0.7)
Creditors due after one year - - (20.5) (2.3) (22.8)
17.2 - (20.5) (3.0) (6.3)
Cash flow (4.1) - - - (4.1)
Foreign exchange rate changes - - 0.2 - 0.2
Drawdown - - (15.0) - (15.0)
Repayment - - 10.3 0.5 10.8
(4.1) - (4.5) 0.5 (8.1)
At 30 June 2011
Current assets 13.1 - - - 13.1
Creditors due within one year - - - (0.6) (0.6)
Creditors due after one year - - (25.0) (1.9) (26.9)
13.1 - (25.0) (2.5) (14.4)
At 30 June 2010
Current assets 17.5 - - - 17.5
Creditors due within one year - (1.7) (39.2) (0.8) (41.7)
Creditors due after one year - - - (2.7) (2.7)
17.5 (1.7) (39.2) (3.5) (26.9)
The loan drawdown and repayments have been made under the Group's revolving loan
facilities.
9. Tax
Corporation tax for the interim period is estimated based on the best estimates
of the weighted average annual corporation tax rate expected to apply to each
taxable entity for the full financial year.
The Company and subsidiaries that are within the EU approved Tonnage Tax
jurisdictions have elected to be taxed under the tonnage tax method. Under the
tonnage tax method, taxable profit on eligible activities is calculated on a
specified notional profit per day related to the tonnage of the ships utilised.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE HALF YEAR ENDED 30 JUNE 2011
10. Retirement Benefit Schemes
Retirement benefit scheme valuations have been updated at the half year. Scheme
assets have been valued as per investment managers valuations at 30 June 2011.
In consultation with the actuary to the principal group defined benefit pension
schemes, the discount rate used in relation to the pension scheme liabilities
has been updated to 5.9% for Euro liabilities (31 December 2010 5.5%) and to
5.6% for Sterling liabilities (31 December 2010 5.5%).
The principal assumptions used for the purpose of the actuarial valuations were
as follows:
Unaudited Audited
6 months ended 12 months ended
30 Jun 2011 30 Jun 2010 31 Dec 2010
| | | | | | |
|Sterling| Euro|Sterling| Euro|Sterling| Euro|
| | | | | | |
| | | | | | |
| | | | | | |
Discount rate | 5.60%| 5.90%| 5.30%| 5.20%| 5.50%| 5.50%|
| | | | | | |
Inflation rate | 3.80%| 2.40%| 3.50%| 2.00%| 3.60%| 2.00%|
| | | | | | |
Rate of | 3.55%| 2.20% -| 3.25%| 1.80% -| | |
increase of | | 2.40%| | 2.00%| 3.35%| 1.80% -|
pensions in | | | | | | 2.00%|
payment | | | | | | |
| | | | | | |
Rate of general| 4.80%| | 4.50%| 3.00% -| 4.60%| 3.00% -|
salary | | 3.40% -| | 3.50%| | 3.50%|
increases | | 3.90%| | | | |
| | | | | | |
The long term expected rates of return are as at 31 December 2010.
Unaudited Unaudited Audited
6 months ended 6 months ended 12 months ended
30 Jun 2011 30 Jun 2010 31 Dec 2010
EURm EURm EURm
Opening deficit (17.5) (27.2) (27.2)
Current service cost (0.6) (0.8) (1.7)
Employer contributions paid 2.8 1.9 4.5
Curtailment gain - - 1.8
Other finance income / (expense) 0.1 (0.3) (0.5)
Actuarial (loss) / gain (3.5) (21.9) 5.9
Other 0.4 2.5 (0.3)
Net deficit (18.3) (45.8) (17.5)
Schemes in surplus 3.4 1.4 4.0
Schemes in deficit (21.7) (47.2) (21.5)
Net deficit (18.3) (45.8) (17.5)
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE HALF YEAR ENDED 30 JUNE 2011
11. Net cash from operating activities
Unaudited Unaudited Audited
30 Jun 30 Jun 31 Dec
2011 2010 2010
EURm EURm EURm
Operating activities
Profit for the period 6.1 8.2 39.0
Adjustments for:
Finance costs (net) 0.3 0.5 0.8
Income tax expense 0.1 0.1 1.1
Retirement benefit obligation - service cost 0.6 0.8 1.7
Retirement benefit obligation - payments (2.8) (1.9) (4.5)
Retirement benefit obligation - non cash - (2.2) (1.8)
items
Depreciation of property, plant and 9.6 11.1 21.7
equipment
Amortisation of intangible assets 0.1 0.2 0.5
Amortisation of deferred income (0.1) (0.1) (0.1)
Share-based payment expense 0.1 0.1 0.3
Gain on disposal of vessel - - (9.4)
Gain on disposal of property, plant and
Equipment - - (0.4)
Increase / (decrease) in other provisions 0.2 - (0.4)
Operating cash flow before movements in
working capital 14.2 16.8 48.5
(Increase) / decrease in inventories (1.3) (0.7) 0.1
Increase in receivables (4.9) (3.9) (1.3)
Increase / (decrease) in payables 15.9 11.4 (3.5)
Cash generated from operations 23.9 23.6 43.8
Income taxes paid (0.4) (0.1) (0.6)
Interest paid (0.4) (0.2) (0.4)
Net cash from operating activities 23.1 23.3 42.8
At 30 June 2011 and 2010 the increase in payables is due to the seasonality of
the business, giving rise to an increase in deferred revenue, as at 30 June
2011 and 2010.
12. Related party transactions
Transactions between the company and its subsidiaries, which are related
parties, have been eliminated on consolidation.
During the six months ended 30 June 2011 there were no material changes to, or
material transactions between Irish Continental Group plc and its key management
personnel or members of their close family, other than in respect of
remuneration.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE HALF YEAR ENDED 30 JUNE 2011
13. Contingent Assets / Liabilities
There have been no material changes in contingent assets or liabilities as
reported in the Group's financial statement for the year ended 31 December 2010.
14. Impairment
As the Group does not have assets which are required to be tested annually for
impairment, no impairment review is necessitated.
In relation to other assets, the Group assessed those assets to determine if
there were any indications of impairment. No internal or external indications of
impairment were identified and consequently no impairment review was performed.
15. Composition of the Entity
There have been no changes in the composition of the entity during the period
ended 30 June 2011.
16. Subsequent Events
There have been no material subsequent events, outside the ordinary course of
business, to report since the period ended 30 June 2011.
17. Board Approval
This interim report was approved by the Board of Directors of Irish Continental
Group plc on 29th August 2011.
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Irish Continental Group plc via Thomson Reuters ONE
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