TIDMICGC
Half-Yearly Financial Report
for the half year ended 30 June 2020
Irish Continental Group plc (ICG) the leading Irish-based maritime
transport group, reports its financial performance for the half year
ended 30 June 2020.
This half-yearly financial report references alternative performance
measures (APMs) which are not defined under International Financial
Reporting Standards and which are explained at page 23.
Highlights
Financial summary
Change
HY 2020* HY 2019** %
Revenue EUR130.8m EUR166.8m -21.6%
EBITDA (pre non-trading items) EUR10.0m EUR30.0m -66.7%
EBIT (pre non-trading items) EUR(9.5)m EUR11.6m -
Basic earnings per share (6.2)c 12.8c -
Adjusted earnings per share (6.2)c 4.9c -
Interim dividend nil 4.42c -
Net debt EUR103.3m EUR127.1m -18.7%
--------- ---------- ------
* HY 2020 : Half Year up to 30 June 2020, ** HY 2019 : Half Year up to
30 June 2019
Volume movements
HY 2020 HY 2019 Change
'000 '000 %
Cars 56.6 161.2 -64.9%
RoRo freight 149.4 153.6 -2.7%
Containers shipped (teu*) 155.7 176.3 -11.7%
Port lifts 141.0 163.1 -13.5%
-------- ------- ------
*teu: twenty foot equivalent units
The HY 2020 result is reported against the challenging background of
depressed economic activity and travel restrictions imposed across the
EU because of the Covid-19 pandemic which has led to a significant
reduction in passenger traffic while freight activity across the Group
has been less affected. Notwithstanding these events, the Group has
continued to focus on its strategic development and has retained a
strong liquidity position. Key highlights in HY 2020 include;
-- Revenues generated totalled EUR130.8 million, EUR36.0 million less than
HY 2019.
-- EBIT generated was a loss of EUR9.5 million, EUR21.1 million less than HY
2019.
-- EBITDA generated of EUR10.0 million, EUR20.0 million less than HY 2019.
-- Gross cash balances EUR132.5 million (31 December 2019: EUR110.9
million).
-- Net Debt at EUR103.3 million is EUR25.7 million lower than at the
beginning of the year.
-- No interim dividend declared (2019: 4.42c per share).
-- The Group maintained services on all its shipping routes and operations
at its container terminals.
-- Cost containment measures introduced.
-- Return of EUR33 million deposit following termination of shipbuilding
contract as a consequence of the shipbuilder entering administration.
-- Environmentally friendly investment program in exhaust gas cleaning
systems substantially completed.
-- Further investment in environmentally friendly port equipment at Dublin
Ferryport Terminal.
-- Agreement signed to operate a new container depot at the new Dublin
Inland Port.
Page 1
Half-Yearly Financial Report
for the half year ended 30 June 2020
Commenting on the results, Chairman John B. McGuckian noted;
The trading conditions faced by the Group since March 2020, particularly
in our passenger business, have been the most challenging encountered by
the Group in its 32 year history. Notwithstanding the travel
restrictions imposed by governments throughout the EU, the Company has
continued to service all its shipping routes providing critical
logistical links to the island of Ireland. These services have also
facilitated passenger travel, including returning medical and caring
volunteers and technicians to fix vital equipment in our hospitals and
care centres and an ability for our citizens to repatriate, where they
must do so, to deal with emergencies at home and for those who must
travel for essential reasons. On behalf of the Group I would like to
thank our staff and crews for their tremendous efforts in maintaining
services during these difficult times.
There are a large number of variables beyond the control of the Group
around Covid-19 developments creating uncertainty for future passenger
travel. However, we are encouraged by the recovering freight volumes
since June to date. The Group remains in a strong financial position to
weather this Covid-19 storm, and we refer investors to our cash and
undrawn credit facilities position at 30 June.
Enquiries:
--------------------------------
Eamonn Rothwell, Chief Executive Tel: +353 1 607 5628 Email: mailto:info@icg.ie
Officer info@icg.ie
--------------------------------------------------
David Ledwidge, Chief Financial Tel: +353 1 607 5628 Email: mailto:info@icg.ie
Officer info@icg.ie
--------------------------------------------------
Media enquiries:
Q4 Public Relations Tel: +353 1 475 1444 Email: press@q4pr.ie
Page 2
Half-Yearly Financial Report
for the half year ended 30 June 2020 - Continued
Results
Financial Highlights
Change
HY 2020 HY 2019 % FY 2019*
Revenue EUR130.8m EUR166.8m -21.6% EUR357.4m
EBITDA (pre non-trading items) EUR10.0m EUR30.0m -66.7% EUR86.8m
EBIT (pre non-trading items) EUR(9.5)m EUR11.6m - EUR50.0m
EBIT (including non-trading items) EUR(9.5)m EUR26.5m - EUR64.9m
--------- --------- ------ ---------
Non-trading items : HY 2020 : EURnil; HY2019: EUR14.9 million; FY 2019:
EUR14.9 million.
* FY 2019 = Year End up to 31 December 2019
ICG reports its results for HY 2020 against the challenging background
of depressed economic activity and travel restrictions imposed across
the EU because of the Covid-19 pandemic which has led to a significant
reduction in passenger traffic while freight activity across the Group
has been less affected.
The Group recorded revenue of EUR130.8 million compared with EUR166.8
million in HY 2019, a decrease of 21.6%. Earnings before interest, tax,
depreciation and amortisation (EBITDA) before non-trading items were
EUR10.0 million compared with EUR30.0 million in HY 2019. Group fuel
costs decreased by EUR8.4 million (-32.9%) to EUR17.1 million from
EUR25.5 million. Earnings before interest and tax (EBIT) were EUR(9.5)
million compared with EUR11.6 million in HY 2019. A loss before tax of
EUR11.2 million is reported compared with a profit before tax EUR24.9
million in HY 2019.
There was a net finance charge of EUR1.7 million (2019: EUR1.6 million)
which includes net bank interest payable of EUR1.3 million (2019: EUR1.1
million), lease interest EUR0.5 million (2019: EUR0.5 million) and a net
pension interest income of EUR0.1 million (2019: EURnil). The tax charge
amounted to EUR0.4 million (2019: EUR0.6 million). Basic EPS was (6.2)c
compared with 12.8c in HY 2019. Adjusted EPS amounted to (6.2)c versus
4.9c for HY 2019.
Operational Review
Ferries Division
Financial Highlights
Change
HY 2020 HY 2019 % FY 2019
Revenue* EUR61.6m EUR92.3m -33.3% EUR212.4m
EBITDA (pre non-trading items) EUR1.1m EUR19.7m -94.4% EUR67.2m
EBIT (pre non-trading items) EUR(15.3)m EUR4.3m - EUR36.4m
EBIT (including non-trading items) EUR(15.3)m EUR19.2m - EUR51.3m
---------- -------- ------ ---------
Non-trading items : HY 2020 : EURnil; HY 2019: EUR14.9 million; FY 2019:
EUR14.9 million.
*Includes intersegment revenue of EUR3.5 million (HY 2019: EUR3.4
million)
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 chartering of vessels.
Revenue in the division was EUR61.6 million (2019: EUR92.3 million)
while EBITDA was EUR1.1 million (2019: EUR19.7 million). EBIT was a loss
of EUR15.3 million compared to a profit of EUR4.3 million in HY 2019,
excluding the 2019 profit on disposal of the Oscar Wilde of EUR14.9
million.
The performance of the ferries operations in HY 2020 was significantly
affected by the imposition of travel restrictions on non-essential
travel across the EU from mid-March as a response to the Covid-19
pandemic. In response as a cost containment measure Irish Ferries
suspended Dublin Swift fastcraft sailings, on a rolling basis, pending
expected relaxation of travel restrictions. Passenger capacity was also
restricted on its fleet of conventional ferries. As a provider of
essential logistical links on and off the island of Ireland, Irish
Ferries operated a full schedule on its conventional ferry services to
service its freight customers and those passengers required to travel
for essential reasons.
Page 3
Half-Yearly Financial Report
for the half year ended 30 June 2020 - Continued
Operational Review -- continued
Ferries Division -- continued
Tourism
Change
HY 2020 HY 2019 % FY 2019
Car volumes ('000) 56.6 161.2 -64.9% 401.3
Passenger volumes ('000) 233.9 648.0 -63.9% 1,541.0
Passenger revenue EUR14.3m EUR44.1m -67.6% EUR112.7
-------- -------- ------ --------
In HY 2020 total cars carried were 56,600, down 64.9% on the same period
in HY 2019. Total passenger carryings were 233,900, a decrease of 63.9%
on HY 2019. This decline in carryings mainly occurred from mid-March
following restrictions on non-essential travel related to the Covid-19
pandemic.
Freight
Change
HY 2020 HY 2019 % FY 2019
RoRo freight volumes ('000) 149.4 153.6 -2.7% 313.2
RoRo freight revenue EUR40.8m EUR42.8m -4.7% EUR86.2m
-------- -------- ------ --------
Freight carryings in HY 2020 were 149,400 units, a decrease 2.7% over HY
2019 but which have shown a steady improvement from the initial decline
experienced following the imposition of Covid-19 measures.
Chartering
Change
HY 2020 HY 2019 % FY 2019
Charter revenue EUR6.5m EUR5.4m +20.3% EUR13.5m
-------- ------- ------ --------
The division owns six container vessels, four of which are chartered
internally to Eucon and two chartered externally. The increase in
revenue primarily relates to the additional charter revenues on the
Thetis D and CT Rotterdam acquired in April 2019 and November 2019
respectively. Charter revenue also includes earnings from the bareboat
hire purchase contract relating to the disposal of the Oscar Wilde
concluded in April 2019.
Page 4
Half-Yearly Financial Report
for the half year ended 30 June 2020 - Continued
Operational Review -- continued
Ferries Division -- continued
Costs
Change
HY 2020 HY 2019 % FY 2019
Operating costs EUR76.9m EUR88.0m -12.6% EUR126.1m
-------- -------- ------ ---------
Costs in the division decreased EUR11.1 million in HY 2020 compared to
HY 2019. In addition to activity related variances on reduced volumes,
the division was proactive in containing costs through suspension of
fastcraft services and reduction of passenger services on-board our
conventional vessels. Fuel costs declined to EUR11.8 million from
EUR18.1 million in HY 2019, the decrease related both to suspended
fastcraft sailings, lower global fuel costs and commissioning of new
exhaust gas cleaning systems ("EGCS") on certain vessels. Maintenance
expenses were also lower following the major works undertaken in 2019.
Container and Terminal Division
Financial Highlights
Change
HY 2020 HY 2019 % FY 2019
Revenue* EUR73.2m EUR78.4m -6.6% EUR143.3m
EBITDA EUR8.9m EUR10.3m -13.6% EUR16.1m
EBIT EUR5.8m EUR7.3m -20.5% EUR13.0m
-------- -------- ------ ---------
*Includes intersegment revenue of EUR0.5 million (HY 2019: EUR0.5
million)
Operational Highlights
Change
HY 2020 HY 2019 % FY 2019
Volumes '000 '000 '000
Containers shipped (teu) 155.7 176.3 -11.7% 343.5
Port lifts 141.0 163.1 -13.5% 320.8
-------- ------- ------ -------
The Container and Terminal Division includes the intermodal shipping
line Eucon as well as the division's strategically located container
terminals in Dublin and in Belfast.
Revenue in the division decreased by 6.6% to EUR73.2 million (2019:
EUR78.4 million), EBITDA decreased to EUR8.9 million (2019: EUR10.3
million) while EBIT decreased to EUR5.8 million (2019: EUR7.3 million).
Total containers shipped by Eucon were down 11.7% at 155,700 teu (2019:
176,300 teu). In response to the decreased volumes attributable to
reduced shipments in light of the Covid-19 pandemic, the division
reduced its fleet capacity from a core six vessels to five vessels
during April. Costs decreased in line with capacity changes and volumes,
with decreases in fuel costs related to lower global prices and
investment in EGCS.
Containers handled at the Group's container terminals in Dublin and
Belfast were down 13.5% to 141,000 lifts (2019: 163,100 lifts). Dublin
Ferryport Terminals' activity was down 11.9%, while activity at Belfast
Container Terminal was down 16.0%.
Page 5
Half-Yearly Financial Report
for the half year ended 30 June 2020 - Continued
Statement of Financial Position
A summary Statement of Financial Position as at 30 June 2020 is
presented below:
30 Jun 30 Jun 31 Dec
2020 2019 2019
EURm EURm EURm
Property, plant and equipment and intangible
assets 324.3 316.7 317.5
Right of use assets 31.7 38.8 36.0
Long term receivable 18.0 20.8 19.4
Retirement benefit surplus 9.5 11.0 12.5
Other current assets 59.4 93.6 95.5
Cash and bank balances 132.5 115.7 110.9
------ ------ -------
Total assets 575.4 596.6 591.8
------ ------ -------
Non-current borrowings 219.8 234.1 227.9
Retirement benefit obligations 3.6 3.4 3.7
Other non-current liabilities 0.7 1.9 1.4
Current borrowings 16.0 8.7 12.0
Other current liabilities 65.6 79.7 58.9
------ ------ -------
Total liabilities 305.7 327.8 303.9
------ ------ -------
Total equity 269.7 268.8 287.9
------ ------ -------
Total equity and liabilities 575.4 596.6 591.8
------ ------ -------
The analysis of key movements in the period since 31 December 2019 is
set out below.
The principal movements in the property, plant and equipment and
intangible assets relate to the installation of EGCS on the Ulysses and
owned container vessels, acquisition of new plant at Dublin Ferryport
Terminal and scheduled replacement expenditure less depreciation charge
in the period. The movement in right of use assets mainly relates to
depreciation of assets over the lease term. The long-term receivable
relates to deferred sales proceeds receivable under the hire purchase
sale agreement entered into on the sale of the Oscar Wilde.
The large reduction in other current assets mainly relates to the
repayment of a EUR33.0 million deposit following the cancellation of the
shipbuilding contract for a new cruise ferry. The increase in other
current liabilities relates to the seasonal increase in passenger
deferred revenue balances for bookings made in advance of the peak
tourism season. With Covid-19 travel restrictions in place, advanced
bookings were significantly lower than at the same time last year.
The assumptions used to value pension obligations were reviewed against
the background of market conditions as at 30 June 2020. This review
resulted in a change in discount and inflation rate assumptions while
the valuation for the main scheme was also updated for demographic
experience. Other assumptions were retained at 31 December 2019 levels.
A net actuarial loss of EUR3.5 million arose in HY 2020 comprising
losses on assets in excess of previous assumptions partly offset by
experience gains on obligations.
Shareholders' equity declined to EUR269.7 million from EUR287.9 million
over the period. The movements primarily comprised of the loss for the
financial period of EUR11.6 million, net actuarial losses of EUR3.5
million arising on retirement benefit schemes, settlement of share
options and buyback of shares. No dividends were paid in the half year
ended 30 June 2020.
Page 6
Half-Yearly Financial Report
for the half year ended 30 June 2020 - Continued
Cash Flow
A summary of cash flows in the half year to 30 June 2020 is presented
below:
HY 2020 HY 2019 FY 2019
EURm EURm EURm
Operating (loss) / profit (EBIT)* (9.5) 26.5 64.9
Non trading items - (14.9) (14.9)
Depreciation 19.5 18.4 36.8
------- ------- -------
EBITDA* (pre non-trading items) 10.0 30.0 86.8
------- ------- -------
Working capital movements 6.9 17.6 2.0
Pension payments in excess of service costs (0.6) (0.9) (1.3)
Other (0.5) 1.4 2.0
------- ------- -------
Cash generated from operations 15.8 48.1 89.5
------- ------- -------
Interest paid (1.7) (1.6) (3.5)
Tax paid (0.3) (0.7) (1.2)
Intangible asset additions (0.3) (0.1) (0.2)
Capex excluding strategic capex (8.2) (12.7) (11.4)
------- ------- -------
Free cash flow before strategic capex* 5.3 33.0 73.2
------- ------- -------
Strategic capex (12.9) (19.4) (42.5)
Return of vessel deposit 33.0 - -
------- ------- -------
Free cash flow after strategic capex* 25.4 13.6 30.7
------- ------- -------
Net asset sales 2.6 0.3 1.8
Dividends - (16.3) (24.7)
Share issue - - 0.1
Share buyback (1.8) (2.1) (12.9)
------- ------- -------
Net cash flows 26.2 (4.5) (5.0)
Opening net debt (129.0) (80.3) (80.3)
Lease liability non-cash movements (1.2) (42.5) (44.5)
Translation/ other 0.7 0.2 0.8
------- ------- -------
Closing net debt (103.3) (127.1) (129.0)
------- ------- -------
*Additional information in relation to these Alternative Performance
Measures ("APMs") is disclosed on page 23.
Net debt decreased to EUR103.3 million at 30 June 2020 from EUR129.0
million at 31 December 2019.
Net cash flows comprised EBITDA for the period of EUR10.0 million, the
return of the vessel deposit following cancellation of a contract for a
new vessel and an overall positive seasonal working capital movement of
EUR6.9 million. The working capital movements are largely attributable
to higher deferred revenue balances ahead of the peak summer passenger
season, though due to the uncertainty surrounding Covid-19 travel
restrictions advance bookings were significantly lower than at the same
time last year. These positive movements are offset by capital
expenditure outflows in the period of EUR21.4 million. During the period
EUR1.8 million was returned to shareholders through a buyback of shares.
The Group did not proceed with payment of the 2019 final dividend due to
the effects of Covid-19 travel restrictions on trading.
Page 7
Half-Yearly Financial Report
for the half year ended 30 June 2020 - Continued
Financing
Net debt
Inception Bank Loans
Cash Fees & PP Notes Lease Liabilities Net Debt
EURm EURm EURm EURm EURm
At 31 December 2019 110.9 1.1 (205.0) (36.0) (129.0)
Lease liability non-cash
movements - - (1.2) (1.2)
Cash flows 21.6 - 4.6 26.2
Translation/ other - (0.1) - 0.8 0.7
----- --------- ----------- ----------------- --------
At 30 June 2020 132.5 1.0 (205.0) (31.8) (103.3)
----- --------- ----------- ----------------- --------
The net debt position of the Group at 30 June 2020 was EUR103.3 million,
a decrease of EUR25.7 million from the opening position at 1 January
2020.
The borrowing facilities available to the Group at 30 June 2020 were as
follows;
Borrowing Facilities
Committed Committed
facilities facilities
Facility Committed drawn undrawn
EURm EURm EURm EURm
Revolving Credit 125.0 75.0 - 75.0
Private Placement 245.6 50.0 50.0 -
European Investment Bank 155.0 155.0 155.0 -
Lease liabilities 31.8 31.8 31.8 -
Overdraft and other 15.4 15.4 - 15.4
-------- --------- ----------- -----------
572.8 327.2 236.8 90.4
-------- --------- ----------- -----------
At 30 June 2020 the Group had total lending facilities of EUR572.8
million available of which EUR327.2 million were committed facilities.
EUR236.8 million of the committed facilities were drawn. In addition to
the committed lines of credit, the Group had arranged uncommitted
facilities of EUR245.6 million with utilisation dates expiring between 6
months and 4 years.
Dividend
On 1 July the Group announced that due to the effects of Covid-19 on
current trading and notwithstanding that the Group retained a strong
liquidity position, the Directors had considered it prudent not to
proceed with the 2019 final dividend previously announced on 5 March
2020. Consequently no dividends were paid during the half year ended 30
June 2020.
In light of the result to 30 June 2020 combined with trading to date and
the uncertain outlook for the remainder of the year particularly related
to passenger travel the Directors also consider it prudent not to
declare an interim dividend at this time.
Page 8
Half-Yearly Financial Report
for the half year ended 30 June 2020 - Continued
Fuel
Change
HY 2020 HY 2019 % FY 2019
Fuel costs EUR17.1m EUR25.5m -32.9% EUR49.3m
-------- -------- ------ --------
Group fuel costs in the first half of 2020 amounted to EUR17.1 million
(2019: EUR25.5 million). The movement in fuel costs was due to lower
global fuel costs, suspension of fastcraft sailings, reduction in the
operated container fleet partially offset by compliance with the new IMO
2020 fuel regulations requiring consumption of more expensive grade fuel
oils pending completion of the Group's EGCS installation program.
The Group has in place fuel surcharge mechanisms for freight customers
which mitigates the effects of movements in Euro fuel costs and the
additional costs in ensuring compliance with IMO 2020, effective since 1
January 2020. IMO 2020 reduced the permissible maximum sulphur content
of exhaust gases and compliance can be achieved either through
consumption of higher cost fuel oils or investment in EGCS. The Group
has opted to invest in EGCS on its owned vessels operated on Group
services. In the reporting period the Group had not engaged in financial
derivative trading to hedge its fuel costs.
Strategic Developments
The Group has terminated its contract with the German shipbuilder FSG,
who were contracted to build a new vessel for service with Irish
Ferries. This followed FSG making an application through the German
courts to be placed in debtor in possession management under the
oversight of an Insolvency Monitor. As part of the original contract
with the yard, ICG had paid a deposit on this vessel for 20% (EUR33.0
million) of the EUR165.2 million purchase price with the remaining 80%
due on delivery of the ship. This deposit was protected by third party
guarantees and was repaid to ICG in June.
Following the termination, the Group has entered into an agreement with
the owners of the chartered vessel Epsilon to extend that charter for an
additional year up to November 2021, with options to further extend.
This will ensure seamless continuation of services on our existing
routes. The Group has also entered preliminary discussions with a number
of other shipyards for the construction of a vessel of similar design to
that previously contracted with FSG.
Arising from the collapse of passenger carryings following imposition of
Covid-19 travel restrictions, the Dublin Swift fastcraft, which was
scheduled to commence operations in April, was placed on standby mode
pending expected relaxation of travel restrictions in advance of the
traditional peak travel period. The vessel will proceed to deep lay-up
for winter 20/21 later in the year as previously scheduled.
New low sulphur fuel regulations, IMO 2020, became effective from 1
January 2020. IMO 2020 requires all our vessels operating outside of
sulphur emission control areas to reduce sulphur emissions to a level
equivalent to consuming 0.5% sulphur content fuel oils compared to the
previously generally permitted 1.5%. On its owned and operated fleet the
Group had taken the decision to install EGCS to comply with the latest
requirements. EGCS allows a vessel to consume cheaper fuel oils while
cleaning the exhaust emissions to within the levels mandated by IMO
2020. The W.B. Yeats was delivered with an EGCS system while the Dublin
Swift by design consumes marine gas oil which typically has a sulphur
content of less than 0.1%.
The installation and commissioning of new EGCS plant on the Ulysses has
been completed. A decision was taken not to proceed with a similar
installation on the Isle of Inishmore as a consequence of shipyard
delays which would have meant the vessel being out of service during the
summer season and with an uncertain date for return to service. This
work is planned to be completed during 2021. The Group also completed
the installation of EGCS plant on the four owned container vessels
utilised on Eucon services.
Page 9
Half-Yearly Financial Report
for the half year ended 30 June 2020 - Continued
Strategic Developments - continued
The Group took delivery of and commissioned two electrically powered
remotely operated rubber-tyred gantries at its Dublin Ferryport Terminal
following the previous successful commissioning of two similar units
during 2019. At the Belfast Container Terminal three units were
delivered which brings the total delivered at Belfast since December
2019 to eight units. These are currently undergoing commissioning by the
port owner together with a new ship-to-shore crane.
During HY 2020 the Group was successful in the public tender to operate
a container depot at the new Dublin Inland Port. The Group has signed an
agreement to enter into a 20-year lease for this operation on completion
of certain civil works by the landlord. The facility is expected to
become operational during 2021. This facility will be used for the
remote storage, maintenance and upgrade of empty container boxes,
releasing valuable capacity for the handling of containers in the port
area. The Dublin Inland Port will be located adjacent to Dublin Airport
with direct access to the M50 Motorway (Dublin Ring Road) and the Port
Tunnel.
Legal Challenge to the National Transport Authority interpretation of
the EU Regulation No 1177/2010
We continue to pursue the legal challenge to the National Transport
Authority ("NTA") interpretation of the EU Regulation No 1177/2010
concerning the rights of passengers when travelling by sea and inland
waterway. This is in progress by way of judicial review which has been
admitted to the High Court of Ireland who have referred certain
questions for interpretation to the European Court of Justice. We
believe this challenge is necessary, in the best interests of our
customers, to protect the viability of direct links to the Continent
which is now all the more critical against the backdrop of the UK exit
from the EU. These direct links are threatened by what we strongly
believe to be the NTA's incorrect interpretation of the Regulation.
Government support for essential shipping services during Covid-19
With the severe decline of passenger business during the Covid-19
outbreak some ferry routes out of Ireland which are critically important
in providing essential services became cash negative. Recognising the
need to help certain routes remain open the Irish Government adopted a
Public Services Obligation (PSO) model covering the shortfall between
variable revenue and certain variable costs. This was not an approach
that we supported as we believe this model was liable to create
distortions in the marketplace and could be open to legal challenge. For
these reasons we decided not to participate in this PSO model, but we
committed, without any Government support, to continue operating our
lossmaking routes which provide a vital lifeline service to our Island.
We will continue to work closely with all relevant authorities and
closely monitor the developing situation. The Group, where appropriate,
has availed of Governments' staff retention support schemes across
Europe.
Exit of United Kingdom from the European Union
The UK exited the EU on 31 January 2020 and entered a transition period
with a current end date of December 2020 during which negotiations of
new rules on trade, travel and business between the UK and the EU are
taking place. There remains uncertainty over the nature of the
relationship post 2020. The Group's ferry division is highly dependent
on trade flows between Ireland and the UK. Therefore any slowdown in
either economy as a result of the exit of the UK from the EU will likely
have an effect on Irish Ferries carryings.
Retention of the Common Travel Area (CTA) between Britain and Ireland is
of major benefit to the tourism and hospitality sectors in Ireland. The
current Irish Government position, of asking people from Britain who
visit Ireland to restrict their movements for two weeks, is not
consistent with that of the British Government who do not require people
travelling to Britain from Ireland to restrict their movements. In
addition, there is nothing to stop people from Britain visiting Ireland
by travelling through Belfast and Larne without the requirement to
self-isolate which is clearly anomalous. We have written to the Irish
Government on this issue.
Page 10
Half-Yearly Financial Report
for the half year ended 30 June 2020 - Continued
Exit of United Kingdom from the European Union - continued
Irish Ferries has engaged with its port operators and regulatory
authorities to minimise the effect of any port disruptions on its
services following the UK exit. Irish Ferries' deployment of the W.B.
Yeats on Dublin/ Cherbourg has already added significant capacity to the
direct continental services which will lessen the effect of any port
delays which might occur in the short-term on Irish sea services while
new cross border procedures settle in. In addition, due to the fleet
configuration, Irish Ferries has the ability to offer additional
frequency on its direct continental services should demand justify it.
The exit of the UK from the EU is expected to have a lesser effect on
our container shipping operations between Ireland and the Continent.
There is a risk of delays or congestion at European ports with some
potential for increased business, dependent on Irish economic growth.
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 other than in respect of remuneration paid to key
management personnel.
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 on an ongoing
basis. The principal risks and uncertainties faced by the Group as set
out in detail on pages 52 to 57 of the 2019 Annual Report are;
-- Commercial & market -- Service disruption
-- Health & safety -- Hazardous cargo and risk of injury.
-- Operational Compliance -- People trafficking.
-- Financial loss -- Major project failure and inadequate insurance.
-- Fraud -- Payment diversion
-- Volatility -- Fuel costs
-- Information security
-- Cyber Threats
These risks together with the uncertainty around the continuing
disruption to travel and trade surrounding Covid-19 measures remain the
most likely risks to affect the Group during the second half of the
financial year. Following the imposition of the Covid-19 measures, the
Group has continually serviced all its shipping routes providing
essential logistical links on and off the island of Ireland. The
continuing shutdown of certain sectors of the economy will prolong the
effect on the Group's financial outcome, notwithstanding the cost
containment initiatives introduced by the Group. It is very difficult
to estimate the full year financial impact on the Group, but the
reduction in passenger revenue will be material given the loss of peak
summer travel.
Following the exit of the UK from the EU, the nature of the trading
arrangements between the EU and UK post the current transition period
remain unclear. In as much as is feasible we have engaged with our port
operators and regulatory authorities to minimise the possibility of any
port disruptions. It is the Group's view that over the longer-term trade
between Ireland and the UK will remain strong underpinned by cultural
and commercial linkages. The Group's investment in vessels is designed
to provide route planning flexibility to adapt its schedules to customer
demand over the short and long term.
The Group will actively manage these and all other risks through its
risk management structure.
Page 11
Half-Yearly Financial Report
for the half year ended 30 June 2020 - Continued
Events after the Reporting Period
There have been no other material events affecting the Group to report
since 30 June 2020.
Going Concern
After making enquiries, the Directors have reasonable expectation that
the Group has adequate resources to continue in operational existence
for a period of at least 12 months from the date of approval of this
half-yearly financial report. For this reason, they consider it
appropriate to continue to adopt the going concern basis in preparing
this half-yearly financial report.
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, lending
covenants and the medium term strategy of the Group, including capital
investment plans. There is uncertainty around the timing of the lifting
of travel restrictions on non-essential travel and the return of
previous travel patterns, and the effects of Brexit. The Group has
modelled a number of scenarios including emergence of a Covid-19 "second
wave" with the continuation of travel restrictions into 2021. The future
cash requirements under these scenarios have been compared to bank
facilities which are reasonably expected to be available to the Group on
normal market terms.
Page 12
Half-Yearly Financial Report
for the half year ended 30 June 2020 - Continued
Current Trading and Outlook
The second half of 2020 has continued to be affected by the retention of
the Covid-19 measures introduced by governments earlier in the year.
While recent levels of freight carrying compared to the same period last
year have remained robust against the continuing shutdown of certain
economic sectors, passenger carryings are materially affected having
already lost a significant amount of peak season passenger travel.
Ferries
Activity in the Ferries Division in the period from 1 July 2020 to 22
August 2020 compared to the same period last year is set out below;
-- Car carryings were 30,000 cars, a decrease of 73.8%
-- RoRo freight carryings were 49,100, an increase of 9.6%
Cumulatively in the period from 1 January 2020 to 22 August 2020
compared to the same period last year activity was;
-- Car carryings were 86,600 cars, a decrease of 68.6%
-- RoRo freight carryings were 198,500, an increase of 0.1%
Container and Terminal
Activity in the Container and Terminal division in the period from 1
July 2020 to 22 August 2020 compared to the same period last year was;
-- Containers shipped were 45,700 teu, a decrease of 7.1%
-- Port lifts were 41,300 lifts, an decrease of 11.3%
Cumulatively in the period from 1 January 2020 to 22 August 2020,
compared to the same period last year activity was;
-- Containers shipped were 201,400 teu, a decrease of 10.5%
-- Port lifts were 182,200 lifts, an decrease of 12.9%
There are a large number of variables beyond the control of the Group
around Covid-19 developments creating an uncertain trading environment
in the second half of 2020. It is very difficult to estimate the full
year financial impact on the Group, as the reduction in passenger
revenue will be material, though recovering freight activity since 1
July to date is encouraging. The Group remains in a strong financial
position to weather this Covid-19 storm with cash and undrawn committed
lending facilities totalling EUR222.9 million at 30 June.
Auditor Review
This half-yearly financial report has not been audited or reviewed by
the auditors of the Group.
Page 13
Half-Yearly Financial Report
for the HALF YEAR ended 30 June 2020 - Continued
Forward-Looking Statements
This report contains certain forward-looking statements. 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. These forward-looking 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 is available on the Group's website
https://www.globenewswire.com/Tracker?data=ZGNnOI0Wzx2VQGIcEsk2OThzcxbD5RaCRosViAtH0kS9FvCWQzJeYK3JJz46qblL
www.icg.ie.
John B. McGuckian
Chairman
26 August 2020
Page 14
Half-Yearly Financial Report
for the HALF YEAR ended 30 June 2020 - Continued
RESPONSIBILITY STATEMENT
The Directors are responsible for preparing the Half-Yearly Financial
Report in accordance with the Transparency (Directive 2004/109/EC)
Regulations 2007 (as amended), the related Transparency Rules of the
Central Bank of Ireland and IAS 34, 'Interim Financial Reporting' as
adopted by the European Union.
Each of the directors confirm that to the best of their knowledge and
belief:
-- the Group Condensed Financial Statements for the half year ended 30 June
2020 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 2020, 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.
On behalf of the Board
Eamonn Rothwell David Ledwidge
Director Director
26 August 2020
Page 15
CONDENSED CONSOLIDATED
INCOME STATEMENT
FOR THE HALF YEARED 30 JUNE 2020
Notes HY 2020 HY 2019 FY 2019
Unaudited Unaudited Audited
EURm EURm EURm
Revenue 4 130.8 166.8 357.4
Depreciation and amortisation (19.5) (18.4) (36.8)
Employee benefits expense (11.1) (10.2) (23.8)
Other operating expenses (109.7) (126.6) (246.8)
--------- --------- -------
(9.5) 11.6 50.0
Non-trading items 6 - 14.9 14.9
----- --------- --------- -------
Operating (loss) / profit (9.5) 26.5 64.9
Finance income 0.1 0.1 0.1
Finance costs (1.8) (1.7) (3.5)
--------- --------- -------
(Loss) / profit before taxation (11.2) 24.9 61.5
Income tax expense (0.4) (0.6) (1.3)
--------- --------- -------
(Loss) / profit for the financial
period: all attributable to equity
holders of the parent 4 (11.6) 24.3 60.2
----- --------- --------- -------
Earnings per ordinary share
-- expressed in cent per share
Basic 7 (6.2)c 12.8c 31.7c
----- --------- --------- -------
Diluted 7 (6.2)c 12.7c 31.5c
----- --------- --------- -------
Page 16
CONDENSED CONSOLIDATED STATEMENT
OF COMPREHENSIVE INCOME
FOR THE HALF YEARED 30 JUNE 2020
HY 2020 HY 2019 FY 2019
Unaudited Unaudited Audited
Notes EURm EURm EURm
(Loss) / profit for the financial
period (11.6) 24.3 60.2
--------- ---------------- -------
Items that may be reclassified subsequently
to profit or loss:
Exchange differences on translation
of foreign operations (1.2) - 1.2
Items that will not be reclassified
subsequently to profit or loss:
Actuarial (loss) / gain on defined
benefit pension schemes 14 (3.5) 8.5 9.0
Deferred tax on defined benefit
pension schemes 0.4 0.1 -
--------- ---------------- -------
Other comprehensive income for the
financial period (4.3) 8.6 10.2
--------- ---------------- -------
Total comprehensive income for the
financial period: all attributable
to equity holders of the parent (15.9) 32.9 70.4
--------- ---------------- -------
Page 17
CONDENSED CONSOLIDATED STATEMENT
OF FINANCIAL POSITION
AS AT 30 JUNE 2020
30 Jun 30 Jun 31 Dec
20 19 19
Unaudited Unaudited Audited
Notes EURm EURm EURm
Assets
Non-current assets
Property, plant and
equipment 8 323.7 316.3 317.1
Right of use assets 9 31.7 38.8 36.0
Intangible assets 0.6 0.4 0.4
Long term receivable 10 18.0 20.8 19.4
Retirement benefit surplus 14 9.5 11.0 12.5
----------------- --------- --------- -------
383.5 387.3 385.4
--------- --------- -------
Current assets
Inventories 1.9 3.0 3.1
Trade and other receivables 57.5 90.6 92.4
Cash and bank balances 11 132.5 115.7 110.9
----------------- --------- --------- -------
191.9 209.3 206.4
--------- --------- -------
Total assets 575.4 596.6 591.8
--------- --------- -------
Equity and liabilities
Equity
Share capital 12.2 12.4 12.2
Share premium 19.5 19.4 19.5
Other reserves (10.1) (9.4) (7.3)
Retained earnings 248.1 246.4 263.5
--------- --------- -------
Equity attributable to
equity holders 269.7 268.8 287.9
--------- --------- -------
Non-current liabilities
Borrowings 11 192.7 204.2 200.3
Lease liabilities 11 27.1 29.9 27.6
Deferred tax liabilities 0.3 0.8 0.7
Provisions 0.4 1.1 0.7
Retirement benefit
obligations 14 3.6 3.4 3.7
----------------- --------- --------- -------
224.1 239.4 233.0
--------- --------- -------
Current liabilities
Borrowings 11 11.3 (0.1) 3.6
Lease liabilities 11 4.7 8.8 8.4
Trade and other payables 63.7 79.1 57.4
Current income tax
liabilities 0.3 - 0.2
Provisions 1.6 0.6 1.3
--------- --------- -------
81.6 88.4 70.9
--------- --------- -------
Total liabilities 305.7 327.8 303.9
--------- --------- -------
Total equity and liabilities 575.4 596.6 591.8
--------- --------- -------
Page 18
CONDENSED CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
FOR THE HALF YEARED 30 JUNE 2020 (UNAUDITED)
Share Share Other Retained
Capital Premium Reserves Earnings Total
EURm EURm EURm EURm EURm
Balance at 1 January 2020 12.2 19.5 (7.3) 263.5 287.9
Loss for the financial period - - - (11.6) (11.6)
Other comprehensive income - - (1.2) (3.1) (4.3)
------- -------- --------- --------- ------
Total comprehensive income
for the financial period - - (1.2) (14.7) (15.9)
Employee share-based payments
expense - - 1.0 - 1.0
Settlement of share options
through market purchase - - (1.5) - (1.5)
Transfer to retained earnings
on exercise of options - - (1.1) 1.1 -
Share buy back - - - (1.8) (1.8)
------- -------- --------- --------- ------
- - (2.8) (15.4) (18.2)
Balance at 30 June 2020 12.2 19.5 (10.1) 248.1 269.7
------- -------- --------- --------- ------
Analysed as follows:
Share capital 12.2
Share premium 19.5
Other reserves (10.1)
Retained earnings 248.1
------
269.7
------
Other Reserves comprise the following:
Share
Capital Options Translation
Reserve Reserve Reserve Total
EURm EURm EURm EURm
Balance at 1 January 2020 7.5 5.9 (20.7) (7.3)
------- ------- ----------- ------
Other comprehensive income (1.2) (1.2)
Employee share-based payments
expense - 1.0 - 1.0
Settlement of share options
through market purchase - (1.5) - (1.5)
Transfer to retained earnings
on exercise of options - (1.1) - (1.1)
------- ----------- ------
- (1.6) (1.2) (2.8)
------- ------- ----------- ------
Balance at 30 June 2020 7.5 4.3 (21.9) (10.1)
------- ------- ----------- ------
Page 19
CONDENSED CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
FOR THE HALF YEARED 30 JUNE 2019 (UNAUDITED)
Share Share Other Retained
Capital Premium Reserves Earnings Total
EURm EURm EURm EURm EURm
Balance at 1 January 2019 12.4 19.4 (10.8) 231.9 252.9
------- -------- ----------------- ------------------ ------
Profit for the financial
period - - - 24.3 24.3
Other comprehensive income - - - 8.6 8.6
------- -------- ----------------- ------------------ ------
Total comprehensive income
for the financial period - - - 32.9 32.9
Employee share-based payments
expense - - 1.4 - 1.4
Share issue - - - - -
Share buy back - - - (2.1) (2.1)
Dividends (note 5) - - - (16.3) (16.3)
------- -------- ----------------- ------------------ ------
- - 1.4 14.5 15.9
Balance at 30 June 2019 12.4 19.4 (9.4) 246.4 268.8
------- -------- ----------------- ------------------ ------
Analysed as follows:
Share capital 12.4
Share premium 19.4
Other reserves (9.4)
Retained earnings 246.4
------
268.8
------
Other Reserves comprise the following:
Share
Capital Options Translation
Reserve Reserve Reserve Total
EURm EURm EURm EURm
Balance at 1 January 2019 7.3 3.8 (21.9) (10.8)
------- ------- ------------------- ------
Employee share-based payments
expense - 1.4 - 1.4
------- ------- ------------------- ------
- 1.4 - 1.4
------- ------- ------------------- ------
Balance at 30 June 2019 7.3 5.2 (21.9) (9.4)
------- ------- ------------------- ------
Page 20
CONDENSED CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
FOR THE FINANCIAL YEARED 31 DECEMBER 2019 (AUDITED)
Share Share Other Retained
Capital Premium Reserves Earnings Total
EURm EURm EURm EURm EURm
Balance at 1 January 2019 12.4 19.4 (10.8) 231.9 252.9
------- ------- ------------------ ----------------- ---------------
Profit for the financial year - - - 60.2 60.2
Other comprehensive income - - 1.2 9.0 10.2
------- ------- ------------------ ----------------- ---------------
Total comprehensive income for
the financial year - - 1.2 69.2 70.4
------- ------- ------------------ ----------------- ---------------
Employee share-based payments
expense - - 2.1 - 2.1
Share issue - 0.1 - - 0.1
Dividends - - - (24.7) (24.7)
Share buyback (0.2) - 0.2 (12.9) (12.9)
------- ------- ------------------ ----------------- ---------------
(0.2) 0.1 2.3 (37.6) (35.4)
------- ------- ------------------ ----------------- ---------------
Balance at 31 December 2019 12.2 19.5 (7.3) 263.5 287.9
------- ------- ------------------ ----------------- ---------------
Analysed as follows:
Share capital 12.2
Share premium 19.5
Other reserves (7.3)
Retained earnings 263.5
---------------
287.9
Other Reserves comprise the following:
Share
Capital Options Translation
Reserve Reserve Reserve Total
EURm EURm EURm EURm
Balance at 1 January 2019 7.3 3.8 (21.9) (10.8)
------- ----------------- ---------------------- --------------
Employee share-based payments
expense - 2.1 - 2.1
Other comprehensive expense - - 1.2 1.2
Share buyback 0.2 - - 0.2
------- ----------------- ---------------------- --------------
0.2 2.1 1.2 3.5
------- ----------------- ---------------------- --------------
Balance at 31 December 2019 7.5 5.9 (20.7) (7.3)
------- ----------------- ---------------------- --------------
Page 21
CONDENSED CONSOLIDATED STATEMENT
OF CASH FLOWS
FOR THE HALF YEARED 30 JUNE 2020
HY 2020 HY 2019 FY 2019
Unaudited Unaudited Audited
Notes EURm EURm EURm
Net cash inflow from operating
activities 15 13.8 45.8 84.8
----------------- ----------------- ----------------- ----------------
Cash flow from investing activities
Net proceeds on disposal of property,
plant and equipment 2.6 0.3 1.8
Refund of vessel deposit 33.0 - -
Purchases of property, plant and
equipment 8 (21.1) (32.1) (53.9)
Purchases of intangible assets (0.3) (0.1) (0.2)
----------------- ----------------- ----------------
Net cash (outflow) from investing
activities 14.2 (31.9) (52.3)
----------------- ----------------- ----------------
Cash flow from financing activities
Dividends paid to equity holders
of the Company 5 - (16.3) (24.7)
Repayment of lease liabilities (4.6) (4.5) (9.0)
Proceeds on issue of ordinary share
capital - - 0.1
Share buy back (1.8) (2.1) (12.9)
----------------- ----------------- ----------------
Net cash (outflow)/ inflow from
financing activities (6.4) (22.9) (46.5)
Net (decrease)/ increase in cash
and cash equivalents 21.6 (9.0) (14.0)
Cash and cash equivalents at the
beginning of the period 110.9 124.7 124.7
Effect of foreign exchange rate
changes - - 0.2
----------------- ----------------- ----------------
Cash and cash equivalents at the
end of the period 11 132.5 115.7 110.9
----------------- ----------------- ----------------- ----------------
Page 22
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
1. General information
The Group Condensed Financial Statements are considered non-statutory
financial statements for the purposes of the Companies Act 2014 and in
compliance with section 340(4) of that Act we state that:
-- the Group Condensed Financial Statements for the half year ended 30 June
2020 have been prepared to meet our obligation to do so under the
Transparency (Directive 2004/109/EC) Regulations 2007 (as amended);
-- the Group Condensed Financial Statements for the half year ended 30 June
2020 do not constitute the statutory financial statements of the Group;
-- the figures disclosed relating to 31 December 2019 have been derived from
the statutory financial statements for the financial year ended 31
December 2019 which were audited, received an unqualified audit report
and have been filed with the Registrar of Companies; and
-- the interim figures included in the Group Condensed Financial Statements
for the half year ended 30 June 2020 and the comparative amounts for the
half year ended 30 June 2019 have been neither audited nor reviewed by
the auditors of the Group.
Certain financial measures set out in our Half-Yearly Financial Report
to 30 June 2020 are not defined under International Financial Reporting
Standards (IFRS). Presentation of these Alternative Performance Measures
("APMs") provides useful supplementary information which, when viewed in
conjunction with the Group's IFRS financial information, allows for a
more meaningful understanding of the underlying financial and operating
performance of the Group. These non-IFRS measures should not be
considered as an alternative to financial measures as defined under
IFRS. Descriptions of the APMs included in this report are disclosed
below.
APM Description Benefit of APM
EBITDA EBITDA represents earnings before Eliminates the effects
non-trading items*, interest, of financing and
tax, depreciation and amortisation. accounting decisions
to allow assessment
of the profitability
and performance of
the Group.
EBIT EBIT represents earnings before Measures the Group's
interest and tax. earnings from ongoing
operations.
Free cash flow Free cash flow comprises operating Assesses the availability
before strategic cash flow less capital expenditure to the Group of funds
capex before strategic capex which comprises for reinvestment
expenditure on vessels excluding or for return to
annual overhaul and repairs, and shareholders.
other assets with an expected
economic life of over 10 years
which increases capacity or efficiency
of operations.
Net debt Net debt comprises total borrowings Measures the Group's
less cash and cash equivalents. ability to repay
its debts if they
were to fall due
immediately.
Adjusted EPS EPS is adjusted to exclude non-trading A key indicator of
items and net interest cost on long term financial
defined benefit obligations. performance and value
creation of a public
listed company.
*Non-trading items are material non-recurring items that derive from
events or transactions that fall outside the ordinary activities of the
Group and which individually, or, if of a similar type, in aggregate,
are separately disclosed by virtue of their size or incidence.
In addition to the above APMs the Group utilises additional APMs of
Return on Average Capital Employed and Schedule Integrity in relation to
full year performance which are not meaningful at the half year.
Page 23
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
2. Accounting policies
The Group Condensed Financial Statements for the six months ended 30
June 2020 have been prepared in accordance with the Transparency
(Directive 2004/109/EC) Regulations 2007 (as amended), the Central Bank
(Investment Market Conduct) Rules 2019 and with IAS 34 'Interim
Financial Reporting' as adopted by the European Union.
The accounting policies and methods of computation applied in preparing
these Group Condensed Financial Statements are consistent with those set
out in the Group Annual Report for the financial year ended 31 December
2019, which is available at www.icg.ie.
The following amendments to standards became effective for the Group
commencing 1 January 2020;
-- Amendments to the Conceptual Framework for Financial Reporting, including
amendments to the Conceptual Framework in IFRS Standards
-- Amendments to IFRS 3 -- Definition of a Business
-- Amendments to IAS 1 & IAS 8 -- Definition of Material
-- Amendments to IAS 39, IFRS 7 & IFRS 9 -- Interest Rate Benchmark Reform
The adoption of these amendments did not have a material impact on these
financial statements.
3. Critical Accounting Estimates and Judgements
In the application of the Group's accounting policies, the Directors are
required to make judgements, estimates and assumptions about the
carrying amounts of assets and liabilities. In preparing these Condensed
Financial Statements the approach to the making of these judgements,
estimates and assumptions is consistent with that used in the Group
Annual Report for the financial year ended 31 December 2019. Key sources
of estimation uncertainty relate to post-employment benefits and
assessment of useful lives for property plant and equipment. Critical
accounting judgements are made in respect of identifying indications of
impairment, assessment of non-cancellable lease terms and incremental
borrowing rate and adoption of the going concern assumption.
Other than the changes to assumptions used in relation to the valuation
of retirement benefit obligations set out in note 14 to these Condensed
Consolidated Financial Statements there have been no material changes in
estimates that had previously been made in the prior year financial
statements to 31 December 2019.
Impact of Covid-19
The Group has considered the impact of Covid-19 in respect of the
accounting judgements and estimates made in the preparation of these
Condensed Consolidated Financial Statements. Key considerations included
whether the impact of Covid-19 affected indications of impairment and
recoverability of receivables. There is uncertainty around the timing of
the lifting of travel restrictions on non-essential travel and return of
previous travel patterns. However, the Group does not believe that the
decline experienced in 2020 to date will give rise to a material long
term change in the travel patterns of the Group's customer base. In
respect of the carrying value of its vessels, the Group did not consider
trading in the year to date amounted to an indication of impairment. In
addition the Group has been monitoring the market in vessels and while
activity is reduced there were no indications that the market value of
second-hand vessels had materially declined.
In respect of receivables including the long term receivable, the Group
actively manages its working capital and monitors changes in days
outstanding and bad debt experience. An expected credit loss assessment
of receivables as at 30 June 2020 was performed with no material change
in the provision for expected credit losses over that provided at 31
December 2019.
Page 24
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
4. Segmental information
The Board is deemed the chief operating decision maker within the Group.
Under IFRS 8: Operating Segments, the Group has determined that the
operating segments are (i) Ferries and (ii) Container and Terminal.
These segments are the basis on which the Group reports internally and
are the only two revenue generating segments of the Group. The principal
activities of the Ferries segment are the operation of combined RoRo
passenger ferries and chartering of vessels. The principal activities of
the Container and Terminal segment are the provision of door-to-door and
feeder LoLo freight services, stevedoring and other related terminal
services. There has been no change in the basis of segmentation or in
the basis measurement of segment profit or loss in the period.
i) Revenue Analysis
By business segment:
HY 2020 HY 2019 FY 2019
EURm EURm EURm
Ferries
Passenger 14.3 44.1 112.7
Freight 40.8 42.8 86.2
Charter 6.5 5.4 13.5
------- ------- -------
61.6 92.3 212.4
------- ------- -------
Container and Terminal
Freight 73.2 78.4 154.4
------- ------- -------
Inter segment revenue (4.0) (3.9) (9.4)
------- ------- -------
Total 130.8 166.8 357.4
------- ------- -------
Depressed economic activity and travel restrictions imposed across the
EU because of the Covid-19 pandemic led to a significant reduction in
passenger traffic and a lesser reduction in freight activity in the half
year ended 2020 compared to the half year ended 30 June 2019.
As revenues are recognised over short time periods of no more than days,
a key determinant to categorising revenues is whether they principally
arise from a business to customer (passenger contracts) or a business to
business relationship (freight and charter contracts) as this impacts
directly on the uncertainty of cash flows. On this basis, revenue by
business segment is a reasonable approximation of revenue
disaggregation.
Page 25
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
4. Segmental information -- continued
i) Revenue Analysis - continued
By geographic origin of booking:
HY 2020 HY 2019 FY 2019
EURm EURm EURm
Ireland 63.6 69.4 177.9
United Kingdom 16.5 36.1 66.7
Netherlands 29.8 33.2 63.8
Belgium 15.4 16.4 32.8
France 0.4 0.4 5.8
Other 5.1 11.3 10.4
------- ------- -------
130.8 166.8 357.4
------- ------- -------
No single external customer in the current or prior financial periods
amounted to 10 per cent of the Group's revenues.
ii) (Loss) / Profit for the financial year
Ferries Container and Terminal Group Total
HY 2020 HY 2019 FY 2019 HY 2020 HY 2019 FY 2019 HY 2020 HY 2019 FY 2019
EURm EURm EURm EURm EURm EURm EURm EURm EURm
Operating
(loss) /
profit (15.3) 4.3 36.4 5.8 7.3 13.6 (9.5) 11.6 50.0
Finance income 0.1 0.1 0.1 - - - 0.1 0.1 0.1
Finance costs (1.1) (1.0) (2.0) (0.7) (0.7) (1.5) (1.8) (1.7) (3.5)
Non-trading
items - 14.9 14.9 - - - - 14.9 14.9
------- ------- ------- ------- ------------------ ------- ------- ------- -------
(Loss) /
profit before
tax (16.3) 18.3 49.4 5.1 6.6 12.1 (11.2) 24.9 61.5
Income tax
expense - (0.1) (0.4) (0.4) (0.5) (0.9) (0.4) (0.6) (1.3)
------- ------- ------- ------- ------------------ ------- ------- ------- -------
(Loss) /
profit for
the financial
year (16.3) 18.2 49.0 4.7 6.1 11.2 (11.6) 24.3 60.2
------- ------- ------- ------- ------------------ ------- ------- ------- -------
Page 26
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
4. Segmental information -- continued
iii) Statement of Financial Position
Ferries Container and Terminal Group Total
30 Jun 30 Jun 31 Dec 30 Jun 30 Jun 31 Dec 30 Jun 30 Jun 31 Dec
20 19 19 20 19 19 20 19 19
EURm EURm EURm EURm EURm EURm EURm EURm EURm
Assets
Segment assets 355.0 391.5 391.1 87.9 89.4 89.8 442.9 480.9 480.9
Cash and
cash equivalents 105.0 85.7 79.8 27.5 30.0 31.1 132.5 115.7 110.9
------ ------ ------ ------ ------ ------- ------ ------ ------
Consolidated
total assets 460.0 477.2 470.9 115.4 119.4 120.9 575.4 596.6 591.8
------ ------ ------ ------ ------ ------- ------ ------ ------
Liabilities
Segment liabilities 41.6 56.9 34.6 28.3 28.1 29.4 69.9 85.0 64.0
Borrowings 180.3 182.3 183.3 55.5 60.5 56.6 235.8 242.8 239.9
------ ------ ------ ------ ------ ------- ------ ------ ------
Consolidated
total liabilities 221.9 239.2 217.9 83.8 88.6 86.0 305.7 327.8 303.9
------ ------ ------ ------ ------ ------- ------ ------ ------
iv) Seasonality
In prior periods Group revenue and profit before tax was weighted
towards the second half of the year principally due to passenger revenue
patterns in the Ferries division whereas operating costs are more evenly
distributed over the year. The disruption to travel in HY 2020 from the
imposition of travel restrictions by government authorities in response
to the Covid-19 pandemic has affected these seasonality weightings.
5. Dividend
HY2020 HY 2019 FY 2019
EURm EURm EURm
Interim dividend - - 8.4
Final dividend - 16.3 16.3
------ ------- -------
- 16.3 24.7
------ ------- -------
No dividends were paid in the six months ended 30 June 2020. In June
2019 a final dividend of 8.56 cent per ICG Unit was paid for the year
ended 31 December 2018.
In October 2019 an interim dividend of 4.42 cent per ICG Unit was paid
for the year ended 31 December 2019. No interim dividend in respect of
2020 had been declared by the Directors at the date of approval of these
Condensed Financial Statements.
Page 27
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
6. Non-trading items
In the prior period the Group sold the vessel Oscar Wilde by way of a
bareboat hire purchase agreement for an agreed consideration of EUR28.9
million, payable in instalments over six years, generating an after tax
gain on disposal of EUR14.9 million. The deferred consideration is
treated as a lease receivable (note 10).The gain on disposal of the
vessel was included in the profit for the relevant period and was
disclosed as a non-trading item in the Condensed Consolidated Income
Statement.
7. Earnings per share
HY 2020 HY 2019 FY 2019
Number of shares '000 '000 '000
Weighted average number of ordinary shares
for the purpose of basic earnings per
share 187,076 190,237 189,797
Effect of dilutive potential ordinary
shares: Share options - 1,263 1,143
------- ------- -------
Weighted average number of ordinary shares
for the purpose of diluted earnings per
share 187,076 191,500 190,940
------- ------- -------
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 dilutive effect of share
options capable of exercise during the period ended 30 June 2020 was
922,000 shares which have been excluded from the weighted average number
of ordinary shares for the purpose of diluted earnings per share as they
are antidilutive.
(Loss) / profit attributable to ordinary shareholders
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:
HY 2020 HY 2019 FY 2019
Earnings EURm EURm EURm
Earnings for the purpose of basic and diluted
earnings per share -- (Loss) / profit for
the financial period attributable to equity
holders of the parent (11.6) 24.3 60.2
Effect of non-trading items after tax - (14.9) (14.9)
Effect of net interest income on defined
benefit pension schemes (0.1) - -
Earnings for the purpose of adjusted earnings
per share (11.7) 9.4 45.3
------- ------- -------
Cent Cent Cent
------- ------- -------
Basic earnings per share (6.2) 12.8 31.7
------- ------- -------
Diluted earnings per share (6.2) 12.7 31.5
------- ------- -------
Adjusted basic earnings per share (6.2) 4.9 23.8
------- ------- -------
Adjusted diluted earnings per share (6.2) 4.9 23.7
------- ------- -------
Page 28
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
8. Property, plant and equipment
Plant,
Assets Equipment Land and
under construction Vessels and Vehicles Buildings Total
EURm EURm EURm EURm EURm
Cost
At 31 December
2019 6.9 429.1 60.4 26.0 522.4
Additions 1.5 18.0 1.6 - 21.1
Disposals (5.4) (8.0) (0.2) - (13.6)
Reclassification 2.6 3.9 - - 6.5
Currency
adjustment - (1.4) (0.2) - (1.6)
------------------- ------- -------------- ------------ ------
At 30 June 2020 5.6 441.6 61.6 26.0 534.8
------------------- ------- -------------- ------------ ------
Accumulated
depreciation
At 31 December
2019 - 152.1 43.9 9.3 205.3
Charge for period - 13.0 1.4 0.1 14.5
Disposals - (8.0) (0.2) - (8.2)
Currency
adjustment - (0.4) (0.1) - (0.5)
------------------- ------- -------------- ------------ ------
At 30 June 2020 - 156.7 45.0 9.4 211.1
------------------- ------- -------------- ------------ ------
Carrying amount
At 30 June 2020 5.6 284.9 16.6 16.6 323.7
------------------- ------- -------------- ------------ ------
At 31 December
2019 6.9 277.0 16.5 16.7 317.1
------------------- ------- -------------- ------------ ------
At 30 June 2019 8.5 273.6 17.3 16.9 316.3
------------------- ------- -------------- ------------ ------
During the period deposits totalling EUR6.5 million at 31 December 2019,
included in prepayments, were transferred to property plant and
equipment as the related assets were delivered to the Group. Certain of
these assets were undergoing commissioning at 30 June 2020 and are
classified as assets under construction.
Disposals of assets under construction in the period ended 30 June 2020
include a refund of a vessel deposit, part of which had been included in
cost as at 31 December 2019 based on an estimate of work completed at
that date. Disposal of vessels relate to drydock expenditure previously
capitalised and fully expensed to the Income Statement.
Page 29
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
9. Right of Use Assets
Plant,
Equipment Land and
Vessels and Vehicles Buildings Total
EURm EURm EURm EURm
Cost
At 31 December 2019 10.9 8.2 29.5 48.6
Additions - 1.3 - 1.3
Currency adjustment - - (1.0) (1.0)
------- -------------- ------------ -----
At 30 June 2020 10.9 9.5 28.5 48.9
------- -------------- ------------ -----
Accumulated depreciation
At 31 December 2019 5.7 4.7 2.2 12.6
Charge for period 2.9 0.9 1.0 4.8
Currency adjustment - - (0.2) (0.2)
------- -------------- ------------ -----
At 30 June 2020 8.6 5.6 3.0 17.2
------- -------------- ------------ -----
Carrying amount
At 30 June 2020 2.3 3.9 25.5 31.7
------- -------------- ------------ -----
At 31 December 2019 5.2 3.5 27.3 36.0
------- -------------- ------------ -----
At 30 June 2019 8.1 3.5 27.2 38.8
------- -------------- ------------ -----
10. Lease receivable
30 Jun 30 Jun 31 Dec
20 19 19
EURm EURm EURm
Operating activities
Current finance lease receivable 2.8 2.7 2.7
Non -- current finance lease receivable 18.0 20.8 19.4
------ -------- ------
Total 20.8 23.5 22.1
------ -------- ------
Beginning of reporting period 22.1 - -
Additions - 24.5 24.5
Amounts received (1.7) (1.1) (2.9)
Net benefit recognised in period 0.4 0.1 0.5
------ -------- ------
End of reporting period 20.8 23.5 22.1
------ -------- ------
The long term receivable relates to amounts due under a bareboat hire
purchase sale agreement for the disposal of the vessel Oscar Wilde (note
6). The deferred consideration has been treated as a finance lease
receivable at an amount equivalent to the net investment in the lease.
None of the lease receivable at 30 June 2020 was past due and taking
into account the payment experience up to the date of approval of these
Condensed Financial Statements together with retention of legal title no
provision for expected credit losses was considered to be required.
Page 30
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
11. Net cash and borrowing facilities
i) The components of the Groups net debt position at the reporting date
and the movements in the period are set out in the following table.
Bank Lease Origination
Cash Loans Loan Notes Liabilities fees Total
EURm EURm EURm EURm EURm
At 1 January 2020
Current assets 110.9 - - - - 110.9
Creditors due within
one year - - - (8.4) - (8.4)
Creditors due after
one year - (155.0) (50.0) (27.6) 1.1 (231.5)
----- ------- ------------------- ------------ ----------- -------
110.9 (155.0) (50.0) (36.0) 1.1 (129.0)
----- ------- ------------------- ------------ ----------- -------
Movements during the
period
Cash flow 21.6 - - 4.6 - 26.2
Non cashflow changes
Amortisation - - - - (0.1) (0.1)
Right of use assets
recognised - - - (1.3) - (1.3)
Early termination - - - 0.1 - 0.1
Currency adjustment - - - 0.8 - 0.8
----- ------- ------------------- ------------ ----------- -------
21.6 - - 4.2 (0.1) 25.7
----- ------- ------------------- ------------ ----------- -------
At 30 June 2020
Current assets 132.5 - - - - 132.5
Creditors due within
one year - (11.5) - (4.7) 0.2 (16.0)
Creditors due after
one year - (143.5) (50.0) (27.1) 0.8 (219.8)
----- ------- ------------------- ------------ ----------- -------
132.5 (155.0) (50.0) (31.8) 1.0 (103.3)
----- ------- ------------------- ------------ ----------- -------
At 30 June 2019
Current assets 115.7 - - - - 115.7
Creditors due within
one year - - - (8.8) 0.1 (8.7)
Creditors due after
one year - (155.0) (50.0) (29.9) 0.8 (234.1)
----- ------- ------------------- ------------ ----------- -------
115.7 (155.0) (50.0) (38.7) 0.9 (127.1)
----- ------- ------------------- ------------ ----------- -------
Page 31
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
11. Net cash and borrowing facilities -- continued
ii) The maturity profile and available borrowing and cash facilities
available to the Group at 30 June 2020 are set out in the following
table.
Maturity Profile
Less Between Between
On-hand than 1 -- 2 2 -- 5 More than
Facility Undrawn / drawn 1 year years years 5 years
EURm EURm EURm EURm EURm EURm EURm
Cash - - 132.5 132.5 - - -
-------- ------- -------- ---------------- ------------------- ------------------- -----------------
Committed lending
facilities
Bank overdrafts 15.4 15.4 - - - - -
Bank loans 230.0 75.0 155.0 11.5 15.5 46.5 81.5
Loan notes 50.0 - 50.0 - - 50.0 -
Leases 31.8 - 31.8 4.7 2.7 7.8 16.6
Origination Fees (1.0) - (1.0) (0.2) (0.2) (0.4) (0.2)
-------- ------- -------- ---------------- ------------------- ------------------- -----------------
Committed lending
facilities 326.2 90.4 235.8 16.0 18.0 103.9 97.9
-------- ------- -------- ---------------- ------------------- ------------------- -----------------
Uncommitted lending
facilities
Bank loans 50.0
Loan notes 195.6
--------
Uncommitted lending
facilities 245.6
--------
Bank overdrafts are stated net of trade guarantee facilities utilised of
EUR0.6 million.
At 30 June 2020 and the date of approval of these Condensed Financial
Statements the Group satisfies the conditions for drawing under the
committed facilities.
Obligations under the Group borrowing facilities have been cross
guaranteed by the parent company and certain subsidiaries but are
otherwise unsecured except for lease obligations which are secured by
the lessors' title to leased assets.
12. Tax
Corporation tax for the interim period is estimated based on the best
estimate 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 Irish Resident for tax purposes
have elected to be taxed under the Irish tonnage tax scheme. Under the
tonnage tax scheme, taxable profit on eligible activities is calculated
on a specified notional profit per day related to the tonnage of the
ships utilised.
Page 32
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
13. Financial instruments and risk management
The Group's activities expose it to a variety of financial risks
including market risk (such as interest rate risk, foreign currency risk,
commodity price risk), liquidity risk and credit risk. The Group's
funding, liquidity and exposure to interest and foreign exchange rate
risks are managed by the Group's treasury and accounting departments.
Treasury management practices which may include the use of derivative
financial instruments are used to manage these underlying risks.
These interim condensed financial statements do not include all
financial risk management information and disclosures required in the
annual financial statements, and should be read in conjunction with the
2019 Annual Report. There have been no changes to the risk management
procedures or policies since the 2019 year end.
i) Carrying value and fair value estimation of financial assets and
liabilities
The table below sets out the carrying value and fair values of the
Group's financial assets and liabilities at the reporting date.
30 Jun 20 30 Jun 19 31 Dec 19
Carrying Carrying Carrying
value Fair value value Fair value value Fair value
EURm EURm EURm EURm EURm EURm
Financial
assets
Lease
receivable 20.8 20.8 23.5 23.5 22.1 22.1
Trade and
other
receivables 54.7 54.7 87.9 87.9 89.7 89.7
Cash and
cash
equivalents 132.5 132.5 115.7 115.7 110.9 110.9
-------- ---------- -------- ---------- -------- ----------
Total
financial
assets 208.0 208.0 227.1 227.1 222.7 222.7
-------- ---------- -------- ---------- -------- ----------
Financial
liabilities
Borrowings 204.0 211.9 204.1 212.5 203.9 214.5
Lease
liabilities 31.8 31.8 38.7 38.7 36.0 36.0
Trade and
other
payables 63.7 63.7 79.1 79.1 57.4 57.4
-------- ---------- -------- ---------- -------- ----------
Total
financial
liabilities 299.5 307.4 321.9 330.3 297.3 307.9
-------- ---------- -------- ---------- -------- ----------
ii) Fair value hierarchy
The Group has adopted the following fair value measurement hierarchy for
financial assets and liabilities:
-- Level 1: quoted (unadjusted) prices in active markets for identical
assets and liabilities.
-- Level 2: other techniques for which all inputs that have a significant
effect on the recorded fair value are observable, either directly (i.e.
as prices) or indirectly (i.e. derived from prices).
-- Level 3: techniques that use inputs which have a significant effect on
the recorded fair value that are not based on observable market data.
The Group did not hold any financial assets or financial liabilities at
the reporting dates required to be carried at fair value in the
Condensed Statement of Consolidated Financial Position.
iii) Fair value of financial assets and financial liabilities measured
at amortised cost
With the exception of the financial liabilities related to borrowings
set out in the table at (i) above it is considered that the carrying
amounts of financial assets and financial liabilities recognised at
amortised cost in these half year financial statements approximate their
fair values.
Page 33
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
13. Financial instruments and risk management -- continued
iii) Fair value of financial assets and financial liabilities measured
at amortised cost - continued
The fair value of borrowings are classified within Level 3 of the fair
value hierarchy. Fair value has been estimated based on discounted cash
flow analysis with the most significant input being the discount rate
reflecting the Group's own credit risk. The discount rate is derived
from observable market interest rates at the reporting date and
observable credit spread market movements since inception of the
borrowings. For lease liabilities the Group considers that the
incremental borrowing rate used to calculate the carrying value includes
a fair estimate of counterparty risk and the carrying value approximates
fair value.
iv) Derivative financial instruments
At 30 June 2020, 31 December 2019, and 30 June 2019 the Group did not
hold any material positions relating to derivative financial
instruments.
14. Retirement benefit schemes
The assumptions used to value pension obligations were reviewed against
the background of market conditions as at 30 June 2020 leading to a
change in discount and inflation rate assumptions while demographic and
other assumptions were retained at 31 December 2019 levels. Scheme
assets have been valued as per investment managers' valuations at 30
June 2020. In consultation with the actuary to the principal Group
defined benefit pension schemes, the discount rate used in relation to
the pension scheme liabilities is 0.90% for Euro liabilities (31
December 2019: 1.00%) and 1.55% for Sterling liabilities (31 December
2019: 1.85%).
At 30 June 2020 the Group's total obligation in respect of defined
benefit schemes totals EUR277.2 million (31 December 2019: EUR289.6
million). The schemes held assets of EUR283.1 million (31 December 2019:
EUR298.4 million), giving a net pension surplus of EUR5.9 million (31
December 2019: EUR8.8 million net surplus).
The principal assumptions used for the purpose of the actuarial
valuations at 30 June 2020 were derived using techniques consistent with
those used for the assumptions used for the 31 December 2019. The
assumptions, which were set after considering independent actuarial
advice and which are reflective of market conditions that existed at 30
June 2020, were as follows:
30 Jun 20 30 Jun 19 31 Dec 19
Sterling Euro Sterling Euro Sterling Euro
Discount rate 1.55% 0.9% 2.20% 1.10% 1.85% 1.00%
Inflation rate 3.05% 1.10% 2.45% 1.10% 3.20% 1.30%
Rate of increase
of pensions 0.20% - 0.20% - 0.40% -
in payment 2.85% 0.30% 3.15% 0.30% 2.95% 0.50%
Rate of pensionable 0.00% - 0.00% - 0.00% -
salary increases 0.85% 0.80% 1.00% 0.90% 0.90% 0.90%
-------- -------- -------- ------- -------- -------
Page 34
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
14. Retirement benefit schemes -- continued
The movements in the net surplus on the retirement benefit schemes were
as follows:
HY
2020 HY 2019 FY 2019
Movement in retirement benefit schemes
net surplus EURm EURm EURm
Opening surplus/ (deficit) 8.8 (1.7) (1.7)
Current service cost (0.7) (0.7) (1.5)
Curtailment gain - 0.2 0.1
Employer contributions paid 1.3 1.4 2.7
Net interest income 0.1 - -
Actuarial (loss) / gain (3.5) 8.5 9.0
Currency adjustment (0.1) (0.1) 0.2
----- ----------------- --------------
Net surplus 5.9 7.6 8.8
----- ----------------- --------------
Schemes in surplus 9.5 11.0 12.5
Schemes in deficit (3.6) (3.4) (3.7)
----- ----------------- --------------
Net surplus 5.9 7.6 8.8
----- ----------------- --------------
The movement in the net pension surplus since 31 December 2019 includes
actuarial losses which are recognised in the Condensed Consolidated
Statement of Comprehensive Income.
HY 2020 HY 2019 FY 2019
Actuarial (losses) / gains recognised in
the Condensed Consolidated Statement of
Comprehensive Income EURm EURm EURm
Return on scheme assets excluding amounts
recognised as finance income (11.7) 26.1 38.0
Remeasurement adjustments on scheme
liabilities
- Changes in demographic assumptions 6.7 - 0.1
- Changes in financial assumptions 1.4 (17.5) (25.8)
- Experience adjustments 0.1 (0.1) (3.3)
------- ------- --------------
Actuarial (losses) / gains recognised in
the Condensed Consolidated Statement of
Comprehensive Income (3.5) 8.5 9.0
------- ------- --------------
The actuarial loss arising on scheme assets, which are mainly invested
in across a number of equity and bond funds, is reflective of market
movements. The gain relating to demographic assumptions principally
relates to an update of pensioner data.
No provision has been made against scheme surpluses as the Group expect,
having reviewed the rules of the relevant schemes, that the surplus will
accrue to the Group in the future.
Page 35
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEARED 30 JUNE 2020
15. Net cash inflow from operating activities
HY HY
2020 2019 FY 2019
EURm EURm EURm
Operating activities
(Loss) / profit for the financial period
/ year (11.6) 24.3 60.2
Adjustments for:
Finance costs (net) 1.7 1.6 3.4
Income tax expense 0.4 0.6 1.3
Retirement benefit scheme funding in excess
of amounts expensed to Income Statement (0.6) (0.9) (1.3)
Depreciation and amortisation expense 19.5 18.4 36.8
Share-based payment expense less cost of
options settled (0.5) 1.4 1.9
Gain on disposal of property, plant and
equipment - (14.9) (15.1)
Decrease in provisions - - 0.3
------ ------ ----------------
Operating cash flow before movements in
working capital 8.9 30.5 87.5
Decrease in inventories 1.2 0.3 0.2
Increase in receivables (0.6) (12.0) (4.7)
Increase in payables 6.3 29.3 6.5
------ ------ ----------------
Cash generated from operations 15.8 48.1 89.5
Income taxes paid (0.3) (0.7) (1.2)
Interest paid (1.7) (1.6) (3.5)
------ ------ ----------------
Net cash inflow from operating activities 13.8 45.8 84.8
------ ------ ----------------
At 30 June 2020 and 30 June 2019, the overall working capital movements
amounted to EUR6.9 million and EUR17.6 million respectively, which
relate to seasonal working capital inflows that are expected to unwind
in the second half of the year.
Working capital movements in the period ended 30 June 2020 exclude the
return to the Group of the EUR33.0 million deposit paid to the Group
following termination of a shipbuilding contract, of which EUR28.9
million had been included in prepayments at 31 December 2019. This
amount is included within cashflows from investing activities on the
Condensed Consolidated Statement of Cash Flows.
A decrease in other prepayments totalling EUR6.5 million in the period
ended 30 June 2020 have been reclassified to property, plant and
equipment in the Condensed Consolidated Statement of Financial Position
(note 8).
Page 36
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE HALF YEAR ENDED 30 JUNE 2020
16. 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 2020 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. There were no other material related party
transactions in the period.
17. Contingent assets/ liabilities
There have been no material changes in contingent assets or liabilities
as reported in the Group's financial statements for the year ended 31
December 2019.
18. Impairment
Under IFRS, goodwill and other indefinite-lived intangible assets are
required to be tested at least annually for impairment. As the Group
does not have these types of assets no impairment review is required.
In relation to assets other than those listed above, 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. In assessing the
existence of internal or external indications of impairment, the Group
considered the impacts of Covid-19.
19. Composition of the entity
There have been no changes in the composition of the entity during the
half year ended 30 June 2020.
20. Commitments
HY 2020 HY 2019 FY 2019
EURm EURm EURm
Commitments for the acquisition of property,
plant and equipment -- approved and contracted
for 3.6 143.1 144.1
------- ------- -------
21. Events after the reporting period
There have been no other material events affecting the Group to report
since 30 June 2020.
22. Board approval
This interim report was approved by the Board of Directors of Irish
Continental Group plc on 26 August 2020.
Page 37
END.
(END) Dow Jones Newswires
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