TIDMIRSH
SHYSHYSHY
Preliminary Statement of Results for the year ended 31 December 2020
Irish Continental Group (ICG) the leading Irish-based maritime transport
group, reports its financial performance for the year ended 31 December
2020.
Highlights
Financial Summary
2020 2019 Change
Revenue EUR277.1m EUR357.4m (22.5%)
EBITDA (pre non-trading items) EUR42.1m EUR86.8m (51.5%)
EBIT (pre non-trading items) EUR0.8m EUR50.0m (98.4%)
EBIT (including non-trading items) EUR(10.4)m EUR64.9m (116.0%)
Basic earnings per share (10.2)c 31.7c (132.2%)
Adjusted earnings per share (4.3)c 23.8c (118.1%)
Net debt EUR(88.5)m EUR(129.0)m +EUR40.5m
Net debt (pre IFRS 16) EUR(50.0)m EUR(93.5)m +EUR43.5m
Volume movements
2020 2019
'000 '000 Change
RoRo units 335.5 313.2 +7.1%
Cars 137.1 401.3 (65.8%)
Containers shipped (teu) 316.3 343.4 (7.9%)
Port lifts 292.4 320.8 (8.9%)
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This preliminary statement contains certain alternative performance
measures including EBITDA, EBIT, and adjusted earnings per share. An
explanation of these measures together with other abbreviated terms is
provided at note 10 on page 25 of the Condensed Financial Statements.
-- Revenue decreased EUR80.3 million (22.5%) to EUR277.1 million.
-- EBITDA decrease of EUR44.7 million principally due to Covid-19 travel
restrictions on our passenger business.
-- During 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.
-- The installation and commissioning of new exhaust gas cleaning systems
(EGCS) on the Ulysses and on the four owned container vessels utilised on
Eucon services was completed.
-- 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. As
part of our migration from diesel powered units, 40% of our units are now
electrically powered at our Dublin terminal.
-- On 9 December 2020, the Trustee of the Group's principal defined benefit
pension scheme entered into a transaction whereby the liabilities
relating to pensions in payment at the transaction date were transferred
to a third party insurer on payment of a premium of EUR160.6 million.
This gave rise to a non-cash settlement loss of EUR9.3 million, an
augmentation cost of EUR1.1 million as well as administration expenses
totalling EUR0.8 million relating to the transaction. This is an
important step for the Group in both significantly reducing the quantum
and volatility of pension liabilities on its balance sheet and
safeguarding pensioner benefits into the future.
-- Year end net debt after total capital expenditure of EUR30.1 million was
EUR88.5 million, 2.1 times EBITDA (pre non-trading items), and 1.7 times
under banking covenant definitions.
-- Strong financial position with available liquidity comprising cash and
committed bank facilities of EUR240.8 million at 31 December 2020.
Commenting on the results Chairman John B McGuckian said,
2020 was an exceptionally challenging year for the Group, with the
restrictions placed on travel due to the Covid-19 pandemic. While these
restrictions brought large-scale disruption and reductions in our
passenger business, the other parts of our business proved resilient
throughout the entire year. Our RoRo Freight operations grew in 2020
despite the operational and market difficulties presented by the
pandemic. The Container and Terminal Division largely maintained its
profitability while it optimised capacity levels to meet market demands.
The Group maintained services on all its shipping routes to the United
Kingdom and Continental Europe, and operations at its container
terminals. Both were critical to maintaining Ireland's supply chains
during this challenging year. I would like to take this opportunity to
thank all our colleagues who made the retention of these critical
services possible in these difficult times, but in particular our
colleagues on our front line in the ports, on our ships and in our
terminals. During this most difficult year, their dedication to their
roles kept our ships sailing, our terminals operating and crucially, our
supply lines open.
11 March 2021
Enquiries:
---------------------------------------
Eamonn Rothwell, Chief Executive Tel: +353 1 607 5628 Email:
Officer info@icg.ie
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David Ledwidge, Chief Financial Officer Tel: +353 1 607 5628 Email:
info@icg.ie
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Media enquiries:
Q4 Public Relations Tel: +353 1 475 1444 Email:
press@q4pr.ie
Results
Financial Highlights
2020 2019 Change
Revenue EUR277.1m EUR357.4m (22.5%)
EBITDA (pre non-trading items) EUR42.1m EUR86.8m (51.5%)
EBIT* (including non-trading items) EUR(10.4)m EUR64.9m (116.0%)
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*Non-trading items EUR(11.2) million 31 December 2020 (31 December 2019:
EUR14.9 million)
2020 was a challenging year for the Group, with the level of disruption
caused by the Covid-19 pandemic. Our business model proved its
resilience with the Group remaining profitable before non-trading items
and generating strong cash flows from operations and retaining a strong
balance sheet. The Group operated all its routes throughout the year
maintaining essential services on and off the island of Ireland. Revenue
for the year decreased by EUR80.3 million or 22.5% to EUR277.1 million
(2019: EUR357.4 million), with EUR79.0 million attributed to lower
passenger revenues.
EBITDA for the year decreased by 51.5% to EUR42.1 million (2019: EUR86.8
million) due to Covid-19 related travel restrictions, which materially
reduced passenger traffic in the Ferries Division. EBITDA in the Ferries
Division decreased by 66.8%, to EUR22.3 million, while EBITDA in the
Container and Terminal Division increased by 1.0%, to EUR19.8 million.
In December 2020, the Trustee of the Group's principal defined benefit
pension scheme entered into a buy-out transaction to transfer the
liabilities relating to pensioners (at the transaction date) to a
third-party insurer. This transaction materially reduces the size and
risk of the scheme. This is a positive development for the Group, the
scheme's pensioners and current members. This has resulted in a
non-trading expense in the year of EUR11.2 million. In the prior year,
the Group had incurred a non-trading gain of EUR14.9 million relating to
the sale of the cruise ferry Oscar Wilde.
Overall the Group generated an operating loss or EBIT of EUR(10.4)
million (2019: EUR64.9 million profit). Net interest charges increased
to EUR7.6 million from EUR3.4 million. The taxation charge decreased by
EUR0.3 million to EUR1.0 million. Adjusted EPS was (4.3) cent compared
with 23.8 cent in the prior year. Cash generated from operating
activities amounted to EUR46.1 million (2019: EUR84.8 million), and net
debt reduced from EUR129.0 million to EUR88.5 million.
Operational Review
Irish Continental Group operates through two divisions; the Ferries
Division and the Container and Terminal Division. The Ferries Division
operates under the Irish Ferries brand offering passenger and RoRo
freight services. The division is also engaged in ship chartering
activities with vessels chartered within the Group and to third parties.
The Container and Terminal Division includes the intermodal shipping
line Eucon as well as the division's strategically located container
terminal in Dublin and its terminal operations in Belfast.
Ferries Division
Financial summary
2020 2019 Change
Revenue* EUR141.4m EUR212.4m (33.4%)
EBITDA (pre non-trading items) EUR22.3m EUR67.2m (66.8%)
EBIT** (including non-trading items) EUR(23.5)m EUR51.3m (145.8%)
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*Includes intersegment revenue of EUR9.6 million (2019: EUR9.4 million)
**Non-trading items (EUR11.2) million 31 December 2020 (2019: EUR14.9
million)
Operational Highlights
2020 2019 Change
Volumes '000 '000
Cars 137.1 401.3 (65.8%)
Passengers 519.0 1,541.0 (66.3%)
RoRo freight units 335.5 313.2 +7.1%
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Revenue was 33.4% lower at EUR141.4 million (2019: EUR212.4 million).
EBITDA in the division decreased by 66.8% to EUR22.3 million (2019:
EUR67.2 million) primarily due primarily due to Covid-19 travel
restrictions on our passenger business. In December 2020, the division
entered into a transaction whereby the liabilities relating to pensions
in payment at the transaction date were transferred to a third-party
insurer resulting in an expense of EUR11.2 million. The Group generated
a profit on the sale of the Oscar Wilde in 2019 of EUR14.9 million.
These have been reported as non-trading items. EBIT decreased by 145.8%
to EUR(23.5) million (2019: EUR51.3 million), reflecting the result of
non-trading items and the decrease in EBITDA.
Operational Review -- continued
Ferries Division -- continued
Car and Passenger markets
It is estimated that the overall car market, to and from the Republic of
Ireland, fell by approximately 63.5% in 2020 to 284,000 cars, while the
all-island market, i.e. including routes into Northern Ireland, is
estimated to have decreased by 51.8%. Irish Ferries' car carryings
during the year were down on the previous year by 65.8% to 137,100 cars,
(2019: 401,300 cars). The reductions in carryings is primarily due to
the Covid-19 travel restrictions in place for most of the year.
Resulting from these restrictions and other Covid-19 considerations a
decision was made not to operate the fastcraft Dublin Swift given
available passenger capacity on our conventional ferries.
The total sea passenger market (i.e. comprising car, coach and foot
passengers) to and from the Republic of Ireland decreased by 62.5% on
2019 to a total of 1.1 million passengers, while the all-island market
decreased by 56.2%. Irish Ferries' passenger numbers carried decreased
by 66.3% at 519,000 (2019: 1.54 million). In the first half of the year,
Irish Ferries' passenger volumes fell by 63.9% and in the second half of
the year, which is seasonally more significant, the decrease in
passenger numbers was 68.1%.
RoRo Freight
The RoRo freight market between the Republic of Ireland, and the UK and
France, fell slightly in 2020 on the back of Covid-19 restrictions in
the early part of the year, but was mostly offset in the second half as
the Irish and UK economies opened up again. The market was further
strengthened due to stockpiling in advance of the end of the UK's
transition period upon exiting the EU. The total number of trucks and
trailers was down 1.2%, to approximately 1.03 million units. On an
all-island basis, the market decreased by approximately 1.9% to 1.84
million units.
Irish Ferries' carryings, at 335,500 freight units (2019: 313,200
freight units), increased by 7.1% in the year with volumes down 2.7% in
the first half and up 16.6% in the second half. The performance against
the market is principally related to the attraction of the short sea
routes over other routes.
Chartering
The Group continued to charter a number of vessels to third parties
during 2020. Overall external charter revenues were EUR5.9 million in
2020 (2019: EUR5.3 million). Of our six owned LoLo container vessels,
four are currently on year-long charters to the Group's container
shipping subsidiary Eucon on routes between Ireland and the Continent
whilst two are chartered to third parties. The Oscar Wilde continues on
a bareboat hire purchase agreement with MSC Mediterranean Shipping
Company SA.
Container and Terminal Division
Financial summary
2020 2019 Change
Revenue* EUR146.5m EUR154.4m (5.1%)
EBITDA (pre non-trading items) EUR19.8m EUR19.6m +1.0%
EBIT (including non-trading items) EUR13.1m EUR13.6m (3.7%)
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*Includes inter-segment revenue of EUR1.2 million (2019: EUR1.2 million)
Operational Highlights
2020 2019 Change
Volumes '000 '000
Containers shipped (teu) 316.3 343.4 (7.9%)
Port lifts 292.4 320.8 (8.9%)
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Revenue in the division decreased to EUR146.5 million (2019: EUR154.4
million). The revenue is derived from container handling and related
ancillary revenues at our terminals and in Eucon from a mix of domestic
door-to-door, quay-to-quay and feeder services with 70% (2019: 70%) of
shipping revenue generated from imports into Ireland. With a flexible
chartered fleet and slot charter arrangements Eucon was able to adjust
capacity and thereby continue to meet the requirements of customers in a
cost effective and efficient manner.
EBITDA in the division increased by 1.0% to EUR19.8 million (2019:
EUR19.6 million) while EBIT fell 3.7% to EUR13.1 million (2019: EUR13.6
million). In Eucon, overall container volumes shipped were 316,300 teu
(2019:343,400 teu) down 7.9% compared with the previous year. The
resulting revenue decrease was partially offset by a EUR5.6 million
decrease in fuel costs.
Containers handled at the Group's terminals, Dublin Ferryport Terminal
(DFT) and Belfast Container Terminal (BCT), were down 8.9% at 292,400
lifts (2019: 320,800 lifts). DFT's volumes were down 7.1%, while BCT's
lifts were down 11.4%.
Group Finance Review
Cash Flow
A summary cash flow is presented below:
2020 2019
EURm EURm
Operating (loss) / profit (EBIT)* (10.4) 64.9
Non trading items 11.2 (14.9)
Depreciation 41.3 36.8
------------------------------------------------------------ ------ ------
EBITDA* (pre non-trading items) 42.1 86.8
------------------------------------------------------------ ------ ------
Working capital movements 10.6 2.0
Pension payments in excess of service costs (1.1) (1.3)
Other movements (0.4) 2.0
------------------------------------------------------------ ------ ------
Cash generated from operations 51.2 89.5
------------------------------------------------------------ ------ ------
Interest paid (3.7) (3.5)
Tax paid (1.4) (1.2)
Capital expenditure excluding strategic capital expenditure (10.8) (11.6)
------------------------------------------------------------ ------ ------
Free cash flow before strategic capital expenditure* 35.3 73.2
Strategic capital expenditure (19.3) (42.5)
Return of ship contract deposit 33.0 -
------------------------------------------------------------ ------ ------
Free cash flow after strategic capital expenditure 49.0 30.7
------------------------------------------------------------ ------ ------
Proceeds on disposal of property, plant and equipment 4.9 1.8
Dividends - (24.7)
Share issue 0.2 0.1
Share buyback (1.7) (12.9)
------------------------------------------------------------ ------ ------
Net cash flows 52.4 (5.0)
------------------------------------------------------------ ------ ------
*Additional information in relation to these Alternative Performance
Measures ("APMs") is disclosed on page 25.
EBITDA for the year was EUR42.1 million (2019: EUR86.8 million). There
was a net inflow of working capital of EUR10.6 million, mainly
attributable to an increase in untravelled balances held as deferred
revenue. The Group made payments in excess of service costs to the
Group's pension funds of EUR1.1 million, with the settlement and
augmentation losses arising on the buyout of pension liabilities not
giving rise to cash outflows. Cash generated from operations amounted to
EUR51.2 million (2019: EUR89.5 million).
Interest paid was EUR3.7 million (2019: EUR3.5 million) while taxation
paid was EUR1.4 million (2019: EUR1.2 million).
Spend on maintenance capital expenditure was EUR10.8 million (2019:
EUR11.6 million) included the annual overhaul of vessels and container
fleet renewal. Free cash flow after maintenance capital expenditure was
EUR35.5 million before strategic capital expenditure of EUR19.3 million
related to the purchase and installation of EGCS on the Ulysses, four of
the Group's owned container vessels and the commissioning of two
electrically powered remotely operated rubber-tyred gantries at its
Dublin Ferryport Terminal. Following the cancellation of the contract
for the construction of a cruise ferry, the EUR33.0 million deposit
previously paid was returned by the guarantor. During the period EUR1.7
million was returned to shareholders through a buyback of shares. The
Group did not make any dividend payments during 2020, cancelling the
payment of the 2019 final dividend as a cash conservation measure in
response to the Covid-19 developments.
Net debt at year end was EUR88.5 million in comparison to a net debt
position of EUR129.0 million at 31 December 2019.
Group Finance Review - continued
Balance Sheet
A summary balance sheet is presented below:
2020 2019
EURm EURm
Property, plant & equipment and intangible assets 314.7 317.5
Right-of-use assets 38.3 36.0
Long term receivable 16.6 19.4
Retirement benefit surplus 1.0 12.5
Other assets 57.9 95.5
Cash and bank balances 150.4 110.9
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Total assets 578.9 591.8
-------------------------------------------------- ----- -----
Non-current borrowings 140.9 227.9
Retirement benefit obligations 2.2 3.7
Other non-current liabilities 0.7 1.4
Current borrowings 98.0 12.0
Other current liabilities 71.2 58.9
-------------------------------------------------- ----- -----
Total liabilities 313.0 303.9
-------------------------------------------------- ----- -----
Total equity 265.9 287.9
-------------------------------------------------- ----- -----
Total equity and liabilities 578.9 591.8
-------------------------------------------------- ----- -----
The total net deficit of all defined benefit pension schemes at 31
December 2020 was EUR1.2 million in comparison to an EUR8.8 million
surplus at 31 December 2019. The movement principally reflects
settlement losses and augmentation costs totalling EUR10.4 million
associated with the transfer of pensioner liabilities, a net actuarial
loss of EUR0.8 million and employer contributions in excess of service
costs of EUR1.1 million. Movement in other assets mainly relates to a
reduction in capital related deposits and prepayments of EUR34.4 million
following the return of a shipbuilding deposit and completion of the
EGCS installations. The principal movement in other current liabilities
relates to increased deferred revenue balances. The increase in current
borrowings represents the contractual position at 31 December 2020 in
relation to balances drawn repayable during 2021 in the absence of
identification of a substitute project following the cancellation of the
shipbuilding contract with FSG.
Shareholders' equity decreased to EUR265.9 million from EUR287.9 million
at 31 December 2019. The movement includes the loss for the financial
period of EUR19.0 million, actuarial losses arising on retirement
benefit schemes of EUR0.8 million and buyback of equity of EUR1.7
million.
Financing
The borrowing facilities available to the Group at 31 December 2020 were
as follows;
Borrowing
Facilities
Committed Committed
facilities facilities
Facility Committed drawn undrawn
EURm EURm EURm EURm
Private placement
loan notes 224.1 50.0 50.0 -
Bank term loans 151.3 151.3 151.3 -
Revolving credit 125.0 75.0 - 75.0
Overdraft and
other 16.0 16.0 0.6 15.4
------------------ -------- --------- ----------- ------------------
516.4 292.3 201.9 90.4
------------------ -------- --------- ----------- ------------------
Group Finance Review - continued
Financing -- continued
At 31 December 2020 the Group had total lending facilities of EUR516.4
million available of which EUR292.3 million were committed facilities.
Of these, EUR201.9 million have been utilised, of which EUR87.3 million
are classified as repayable within one year. The interest rates on all
Group borrowings at 31 December 2020 comprising loan notes and term
loans has been fixed at contracted rates at the date of drawdown with
the relevant lender eliminating exposure to interest rate risk on
borrowings. The average interest rate on borrowings at 31 December 2020
was 1.60% (2019: 1.60%) for remaining terms of between four and ten
years. In addition to borrowings the Group has recognised lease
liabilities at 31 December 2020 relating to right-of-use assets
amounting to EUR38.5 million.
These facilities together with undrawn committed facilities of EUR90.4
million and cash generated from operations will be used to support the
long-term strategic development of the Group.
Fuel
2020 2019 Change
Fuel costs EUR32.8m EUR49.3m (33.5%)
------------ -------- -------- -------
Group fuel costs in 2020 amounted to EUR32.8 million (2019: EUR49.3
million). Bunker consumption was 107,300 tonnes in 2020 (2019: 122,000
tonnes). The reduction in consumption was primarily due to the lay-up of
the fastcraft Dublin Swift. The cost per tonne of heavy fuel oil (HFO)
fuel in 2020 was 23% lower than in 2019 while marine gas oil (MGO) was
30% lower than in 2019. This was due to a combination of lower global
fuel cost and a change in the mix of fuels consumed following the
commencement of new fuel regulations (IMO 2020) effective from 1 January
2020. These new regulations designed to reduce sulphur emissions
required the Group to achieve lower sulphur emissions either through
consuming higher priced low sulphur fuel oils or investing in EGCS. The
Group completed the installation of EGCS on 5 of its vessels during the
year, with a system already installed on W.B. Yeats on delivery.
Compliance with these new regulations imposed increased costs on the
Group which it is seeking to recover from the market through additional
surcharges.
The Group has in place a transparent fuel surcharge mechanism for
freight customers across the Group which mitigates movements in Euro
fuel costs. In the reporting period the Group had not engaged in
financial derivative trading to hedge its fuel costs.
Dividend and Share Buyback
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 and also did
not declare any interim dividend.
In light of the travel restrictions continuing into 2021 and uncertainty
around when they may be eased the Directors also consider it prudent not
to declare a final dividend in relation to the year ended 31 December
2020.
During the year the Group bought back 570,000 shares which were
cancelled. The total consideration paid for these shares was EUR1.7
million.
Exit of United Kingdom from the European Union
The UK exited the EU on the 31 January 2020 and ended its transition
period on 31 December 2020. The Group welcomes the EU-UK Trade and
Cooperation Agreement between the UK and the EU. It is the Group's
position that Ireland as an island will continue to trade outside of its
borders. Given the strong linkages between Ireland and the UK both
culturally and commercially, it is the Group's view that trade between
these two economies will remain robust over the longer term.
However, the Group's investment in vessels is designed to provide route
planning flexibility to enable the Group to adapt its schedules to
customer demand both over the short and long term. Should demand for the
Group's existing services fall over the longer term, the vessels are
capable of being deployed to most geographic areas given their design
specification.
Following the end of the transition period, the Group has, adjusted
capacity on the direct continental services. As the UK is no longer a
member of the EU, the Group can introduce duty-free retail facilities
on-board its ferries operating to Britain. This had been an important
ancillary revenue stream prior to the abolition of duty-free retail
under EU rules in 1999.
Of some concern is the lack of implementation of appropriate checks on
goods arriving into Northern Ireland from Britain, which are required
under the Northern Ireland Protocol. To the extent that these goods are
heading for the Republic of Ireland this is causing a distortion in the
level playing fieldas goods from Britain are being checked on arrival in
Republic of Ireland ports. If the exemptions are continued or
enforcement continues to be haphazard jobs will be lost in the Republic
of Ireland as companies migrate to Northern Ireland because of easier
logistical connections for exports and imports.
Group Finance Review -- continued
Strategic Developments
The Group 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.
Arising from the collapse of passenger carryings following imposition of
Covid-19 travel restrictions, the Dublin Swift fastcraft was not
operated as planned. The vessel is currently in lay-up for winter
2020/2021.
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%. During 2020 to comply with the
latest requirements, the Group retro-fitted EGCS on Ulysses and the four
owned container vessels utilised on Eucon services. 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%. A decision
to retro-fit an EGCS on the Isle of Inishmore was deferred to avoid
project risk delays due to the Covid-19 pandemic.
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. The GBP40m re-investment project by Belfast Harbour
Commissioners (BHC) is well underway which includes extensive civil
works and the delivery of two new gantry cranes and eight new
electrically operated rubber tyred gantries incorporating the latest
technologies to allow for remote operation similar to the rubber tyred
gantries operated at Dublin Ferryport Terminals. During 2020, two gantry
cranes were delivered and commissioned to bring the total number on site
to three. In December 2019 six rubber tyred gantries had been delivered
with a further two delivered in June 2020. Of the eight rubber tyred
gantries five are commissioned and in use with the remaining three to be
commissioned during 2021. These rubber tyred gantries are supplemented
by two rail mounted gantry cranes that will be phased out of operation
during 2021.
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 Dublin Port via
the Port Tunnel.
Environment
The Group is conscious that its activities have an environmental impact
but is happy to note that reducing that impact aligns with our overall
strategy. Notwithstanding the challenges faced by the Group during
2020, the Group proceeded with the significant investments in EGCS and
the on-going program of electrification of heavy plant at our container
terminals. Both of these investments while reducing harmful emissions
also bring health and safety benefits to our operatives and align with
the strategic objective of delivering sustained and profitable growth.
However not all environmental initiatives require major capital
investment and we continue our initiatives to replace single use
non-recyclable consumables with environmentally friendly alternatives
across the Group. We have also commenced the roll-out of out our green
voyage initiative to our crews to promote optimal voyage efficiencies.
The Group gathers significant data in relation to its operations which
can be harnessed to further drive awareness of the impact of individual
actions. The Group currently collects various data related to the
environmental impact of its operations for external reporting purposes.
In recognition of the powerful effect that data can have on creating
awareness of individual actions, the Group has now commenced a program
to collate and harness this data as a tool to promote environmental
responsibility within the workforce. The object is to achieve measurable
reductions in our environmental impact across the Group over time.
However, for certain aspects the Group will require the shipping sector
as a whole to work together. This particularly relates to global
regulation under the auspices of the International Maritime Organisation
setting common standards and key equipment suppliers adopting latest
technologies. As a small operator in a global market, the Group will
only apply proven technologies which generate an economic return.
The Group is aware that our stakeholders require us to be
environmentally aware and the Group is committed to continuous
improvement in both the big and small things that we do.
Group Finance Review -- continued
Legal Challenge to the National Transport Authority ("NTA")
interpretation of the EU Regulation no 1177/2010
As previously reported Irish Ferries has commenced legal proceedings by
way of judicial review against the NTA's interpretation of the EU
Regulation no 1177/2010 in respect of the cancellations that arose
during 2018 resulting from the delayed delivery by FSG of our new cruise
ferry W.B. Yeats ship, delivered in December 2018. The review 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, particularly in the context of
whether landbridge is an alternative route to direct services. Greater
clarity on the regulation has an important role to play in our island
connectivity and the viability of direct links to the Continent.
We believe this challenge is 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
As noted, the Group's passenger carryings were severely affected by the
travel restrictions imposed as part of the government's response to the
Covid-19 pandemic. Notwithstanding the Group committed, without any
government support, to continue operating our lossmaking routes which
provide a vital lifeline service to our Island. However, we were
disappointed to note that the Irish Government introduced a Public
Services Obligation (PSO) model for part of 2020 covering the shortfall
between variable revenue and certain variable costs of certain
competitors. 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.
The Group, where appropriate, has availed of governments' staff
retention support schemes across Europe.
Current Trading and Outlook
2021 Trading to date
1/1/21 -- 6/3/21 1/1/20 -- 6/3/20 Change
Volumes '000 '000
Cars 7.4 30.3 (75.6%)
Passengers 37.2 121.3 (69.3%)
RoRo freight units 39.2 56.2 (30.2%)
Containers shipped (teu) 65.1 58.6 +11.1%
Port lifts 57.1 52.3 +9.2%
------------------------- ---------------- ---------------- -------
Since our last update to the market, in the Interim Management Statement
of November 2020, trading to the end of the year in our freight business
was exceptionally strong. For the full year 2020 the Ferries Division
recorded strong volume growth of 7.1% for RoRo freight. However, the
continuation of Covid-19 travel restrictions resulted in a significant
decline in both passenger and car numbers. Passenger numbers fell 66.3%
and cars 65.8%. In the Container and Terminal Division overall container
volumes shipped for the year were down 7.9%, while port lifts were down
8.9%.
In the period from 1 January 2021 to 6 March 2021, trading has been
impacted by both the continuation of Covid-19 travel restrictions and
new customs requirements following the exit of the UK from the EU. Irish
Ferries carried 39,200 RoRo units in the period, a decrease of 30.2% on
the prior year, while the number of cars decreased by 75.6% to 7,400.
The number of passengers carried in the period decreased by 69.3% versus
the prior year.
Covid-19 has had a material impact on our passenger business, and any
recovery is unlikely while government restrictions remain in place,
however we remain hopeful that the rollout of vaccinations will result
in a return to international travel in our markets during 2021.
The material reduction in RoRo freight volumes in the first two months
of the year mirror the same level of volume increases in pre Brexit
stockpiling in the last two months of 2020, leaving total volumes flat
over the four month period. While volumes are down 30.2% year to date,
testament to the flexibility of our fleet we have adjusted to customer
demand and increased tonnage on the Dublin -- Cherbourg route. This has
limited the decline in RoRo revenue to 8.1% versus the prior year. The
current demand on the direct routes to the Continent is expected to
decrease as importers, exporters and government agencies become more
familiar with new requirements following Brexit. The decline will be in
favour of the landbridge which has the benefits of cost, frequency, time
and reliability.
The Container and Terminal Division has reintroduced a sixth vessel to
the fleet from January 2021. In the period from 1 January 2021 to 6
March 2021, overall container volumes shipped were up 11.1% on the prior
year and terminal volumes increased 9.2% on the prior year.
Despite the uncertainty created by the current Covid-19 pandemic and the
recent exit of the UK from the EU, with our flexible and modern fleet
and strong balance sheet we are well placed to benefit from the return
to growth in all our markets. We look forward to better years ahead.
Condensed Consolidated Income Statement
for the year ended 31 December 2020
Notes 2020 2019
EURm EURm
Revenue 277.1 357.4
Depreciation, impairment and amortisation (41.3) (36.8)
Employee benefits expense (18.0) (23.8)
Other operating expenses (217.0) (246.8)
------------------------------------------------ --------- ------------- -------
0.8 50.0
Non-trading items 5 (11.2) 14.9
------------------------------------------------ --------- ------------- -------
Operating (loss) / profit (10.4) 64.9
Finance income 0.2 0.1
Finance costs (7.8) (3.5)
------------------------------------------------ --------- ------------- -------
(Loss) / profit before taxation (18.0) 61.5
Income tax expense 3 (1.0) (1.3)
------------------------------------------------ --------- ------------- -------
(Loss) / profit for the financial year: all attributable
to equity holders of the parent (19.0) 60.2
----------------------------------------------------------- ------------- -------
Earnings per ordinary share
-- expressed in cent per share
Basic (10.2c) 31.7c
------------------------------------------------ --------- ------------- -------
Diluted (10.2c) 31.5c
------------------------------------------------ --------- ------------- -------
Condensed Consolidated Statement of Comprehensive Income
for the year ended 31 December 2020
2020 2019
Notes EURm EURm
(Loss) / profit for the financial year (19.0) 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 (0.8) 9.0
Deferred tax on defined benefit pension schemes 0.3 -
-------------------------------------------------------------- ------ ------
Other comprehensive income for the financial year (1.7) (10.2)
-------------------------------------------------------------- ------ ------
Total comprehensive income for the financial year:
all attributable to equity holders of the parent (20.7) 70.4
-------------------------------------------------------------- ------ ------
Condensed Consolidated Statement of Financial Position
as at 31 December 2020
2020 2019
Notes EURm EURm
Assets
Non-current assets
Property, plant and equipment 313.5 317.1
Intangible assets 1.2 0.4
Right of use assets 38.3 36.0
Retirement benefit surplus 8 1.0 12.5
Long term receivable 16.6 19.4
Deferred tax asset 0.3 -
370.9 385.4
-------------------------------------- ----- ----- -----
Current assets
Inventories 1.9 3.1
Trade and other receivables 55.7 92.4
Cash and bank balances 6 150.4 110.9
-------------------------------------- ----- ----- -----
208.0 206.4
-------------------------------------- ----- ----- -----
Total assets 578.9 591.8
-------------------------------------- ----- ----- -----
Equity and liabilities
Equity
Share capital 12.2 12.2
Share premium 19.7 19.5
Other reserves (9.3) (7.3)
Retained earnings 243.3 263.5
-------------------------------------- ----- ----- -----
Equity attributable to equity holders 265.9 287.9
-------------------------------------- ----- ----- -----
Non-current liabilities
Borrowings 6 113.1 200.3
Lease liabilities 27.8 27.6
Deferred tax liabilities 0.5 0.7
Provisions 0.2 0.7
Retirement benefit obligations 8 2.2 3.7
-------------------------------------- ----- ----- -----
143.8 233.0
-------------------------------------- ----- ----- -----
Current liabilities
Borrowings 6 87.3 3.6
Lease liabilities 10.7 8.4
Trade and other payables 69.2 57.4
Current income tax liabilities - 0.2
Provisions 2.0 1.3
169.2 70.9
-------------------------------------- ----- ----- -----
Total liabilities 313.0 303.9
-------------------------------------- ----- ----- -----
Total equity and liabilities 578.9 591.8
-------------------------------------- ----- ----- -----
Condensed Consolidated Statement of Changes in Equity
for the year ended 31 December 2020
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 year - - - (19.0) (19.0)
Other comprehensive income - - (1.2) (0.5) (1.7)
------------------------------------------------------ ------- ------- --------- --------- -------
Total comprehensive income for the financial year - - (1.2) (19.5) (20.7)
------------------------------------------------------ ------- ------- --------- --------- -------
Employee share-based payments expense - - 1.9 - 1.9
Share issue - 0.2 - - 0.2
Dividends paid - - - - -
Share buyback - - - (1.7) (1.7)
Settlement of employee equity plans through market
purchase - - - (1.7) (1.7)
Transferred to retained earnings on exercise of share
options - - (2.7) 2.7 -
------------------------------------------------------ ------- ------- --------- --------- -------
- 0.2 (2.0) (20.2) (22.0)
------------------------------------------------------ ------- ------- --------- --------- -------
Balance at 31 December 2020 12.2 19.7 (9.3) 243.3 265.9
------------------------------------------------------ ------- ------- --------- --------- -------
Analysed as follows:
Share capital 12.2
Share premium 19.7
Other reserves (9.3)
Retained earnings 243.3
------------------------------------------------------ ------- ------- --------- --------- -------
265.9
------------------------------------------------------ ------- ------- --------- --------- -------
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)
------------------------------------------------------ ------- -------- ------------------------ ------------------
Employee share-based payments expense - 1.9 - 1.9
Other comprehensive income - - (1.2) (1.2)
Share buyback - - - -
Transferred to retained earnings on exercise of share
options (2.7) (2.7)
------------------------------------------------------ ------- -------- ------------------------ ------------------
- (0.8) (1.2) (2.0)
------------------------------------------------------ ------- -------- ------------------------ ------------------
Balance at 31 December 2020 7.5 5.1 (21.9) (9.3)
------------------------------------------------------ ------- -------- ------------------------ ------------------
Condensed Consolidated Statement of Changes in Equity
for the year ended 31 December 2019
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 income - - 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)
------------------------------------ ------- -------- ----------- ------
Condensed Consolidated Statement of Cash Flows
for the year ended 31 December 2020
2020 2019
Notes EURm EURm
Net cash inflow from operating activities 7 46.1 84.8
------------------------------------------------------- ----- ------ ------
Cash flow from investing activities
Net proceeds on disposal of property, plant and
equipment 4.9 1.8
Return of ship building deposit 33.0 -
Purchases of property, plant and equipment (29.1) (53.9)
Purchases of intangible assets (1.0) (0.2)
Net cash inflow / (outflow) from investing activities 7.8 (52.3)
------------------------------------------------------- ----- ------ ------
Cash flow from financing activities
Dividends paid to equity holders of the Company - (24.7)
Share buyback (1.7) (12.9)
Repayment of lease liabilities (9.2) (9.0)
Repayment of bank loans (3.7) -
Proceeds on issue of ordinary share capital 0.2 0.1
Net cash outflow from financing activities (14.4) (46.5)
Net increase / (decrease) in cash and cash equivalents 39.5 (14.0)
Cash and cash equivalents at the beginning of the
year 110.9 124.7
Effect of foreign exchange rate changes - 0.2
------------------------------------------------------- ----- ------ ------
Cash and cash equivalents at the end of the year 6 150.4 110.9
------------------------------------------------------- ----- ------ ------
Notes to the Condensed Financial Statements
for the year ended 31 December 2020
1. Accounting policies
The financial information presented in this report has been prepared
using accounting policies consistent with International Financial
Reporting Standards (IFRSs) as adopted by the European Union and as set
out in the Group's annual financial statements in respect of the year
ended 31 December 2020 except as noted below. The financial information
does not include all the information and disclosures required in the
annual financial statements. The Annual Report will be distributed to
shareholders and made available on the Company's website www.icg.ie in
due course. It will also be filed with the Company's annual return in
the Companies Registration Office. The auditors have reported on the
financial statements for the year ended 31 December 2020 and their
report was unqualified and did not contain any matters to which
attention was drawn by way of emphasis. The financial information for
the year ended 31 December 2019 represents an abbreviated version of the
Group's statutory financial statements on which an unqualified audit
report was issued and which have been filed with the Companies
Registration Office.
Basis of preparation and accounting policies
The financial information contained in this Preliminary Statement has
been prepared in accordance with the accounting policies set out in the
last annual financial statements. New and revised accounting standards
and interpretations have been issued which are set out below.
Standards effective for the Group from 1 January 2020
Standard Description Effective Date
for periods commencing
---------------------------- ------------------------------ -----------------------
IFRS 3 (amendments) Definition of Business 1 January 2020
---------------------------- ------------------------------ -----------------------
IFRS 9, IAS 39 and IFRS Interest Rate Benchmark Reform 1 January 2020
7 (amendments)
---------------------------- ------------------------------ -----------------------
IAS 1 and IAS 8 (amendments) Definition of Material 1 January 2020
---------------------------- ------------------------------ -----------------------
Amendments to References 1 January 2020
to the Conceptual Framework
in IFRS Standards
---------------------------- ------------------------------ -----------------------
The above amended standards have been applied in the preparation of the
financial statements for the year ended 31 December 2020 but did not
have any material impact on the results or financial position of the
Group.
Standards effective for the Group from 1 January 2021 or later
Standard Description Effective Date
for periods commencing
----------------------------- ------------------------------ -----------------------
IFRS 16 (amendment) Covid-19 related rent 1 June 2020
concessions
----------------------------- ------------------------------ -----------------------
IFRS 9, IAS 39, IFRS Interest Rate Benchmark Reform 1 January 2021
7, IFRS 4 and IFRS 16
(amendments)
----------------------------- ------------------------------ -----------------------
IAS 1 (Amendments) Classification of liabilities 1 January 2023
as current or non-current
----------------------------- ------------------------------ -----------------------
IAS 1 (amendments) Disclosure of Accounting 1 January 2023
Policies
----------------------------- ------------------------------ -----------------------
IFRS 17 Insurance Contracts 1 January 2023
----------------------------- ------------------------------ -----------------------
IFRS 4 (amendments) Extension of the Temporary 1 January 2023
Exemption from Applying IFRS
9
----------------------------- ------------------------------ -----------------------
IAS 16 (amendments) Property, Plant and Equipment 1 January 2023
-- Proceeds before Intended
Use
----------------------------- ------------------------------ -----------------------
Annual Improvements 1 January 2023
to IFRS Standards 2018--2020
----------------------------- ------------------------------ -----------------------
IFRS 3 (amendments) Reference to the Conceptual 1 January 2023
Framework
----------------------------- ------------------------------ -----------------------
IAS 37 (amendments) Onerous Contracts - Cost of 1 January 2023
Fulfilling a Contract
----------------------------- ------------------------------ -----------------------
IAS 8 (amendments) Definition of Accounting 1 January 2023
Estimates
----------------------------- ------------------------------ -----------------------
The above standards and amendments standards have not been applied in
the preparation of the financial statements for the year ended 31
December 2020. They are not expected to have a material impact on the
results or financial position of the Group when applied in future
periods.
Notes to the Condensed Financial Statements
for the year ended 31 December 2020 - continued
2. Segmental information
The Board is deemed the chief operating decision maker within the Group.
For management purposes, the Group is currently organised into two
operating segments: Ferries and Container and Terminal.
Revenue has been disaggregated into categories which reflect how the
nature, amount, timing and uncertainty of revenue and cash flows are
affected by economic factors. 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 or a
business to business relationship as this impacts directly on the
uncertainty of cash flows.
i) Revenue analysis
By business segment:
2020 2019
EURm EURm
Ferries
Passenger 33.7 112.7
Freight 92.2 86.2
Charter and other 15.5 13.5
----------------------- ------ -----
141.4 212.4
----------------------- ------ -----
Container and Terminal
Freight 146.5 154.4
----------------------- ------ -----
Inter-segment revenue (10.8) (9.4)
----------------------- ------ -----
Total 277.1 357.4
----------------------- ------ -----
By geographic origin of booking:
2020 2019
EURm EURm
Ireland 116.2 177.9
United Kingdom 55.1 66.7
Netherlands 58.6 63.8
Belgium 31.7 32.8
France 1.3 5.8
Other 14.2 10.4
--------------- ----- -----
277.1 357.4
--------------- ----- -----
No single external customer in the current or prior financial year
amounted to 10 per cent of the Group's revenues.
ii) (loss) / profit for the financial year
Ferries Container & Terminal Group Total
2020 2019 2020 2019 2020 2019
EURm EURm EURm EURm EURm EURm
Operating (loss) /
profit (12.3) 36.4 13.1 13.6 0.8 50.0
Finance income 0.2 0.2 - - 0.2 0.2
Finance costs (6.4) (2.1) (1.4) (1.5) (7.8) (3.6)
Non-trading items (11.2) 14.9 - - (11.2) 14.9
------------------------ ------ ----- ---------- ---------- ------ -----
(Loss) / profit before
tax (29.7) 49.4 11.7 12.1 (18.0) 61.5
Income tax expense (0.3) (0.4) (0.7) (0.9) (1.0) (1.3)
------------------------ ------ ----- ---------- ---------- ------ -----
(Loss) / profit for the
financial year (30.0) 49.0 11.0 11.2 (19.0) 60.2
------------------------ ------ ----- ---------- ---------- ------ -----
Notes to the Condensed Financial Statements
for the year ended 31 December 2020 - continued
2. Segmental information -- continued
iii) Other operating costs
Ferries Container & Terminal Group Total
2020 2019 2020 2019 2020 2019
EURm EURm EURm EURm EURm EURm
Fuel 23.8 34.7 9.0 14.6 32.8 49.3
Labour 22.9 25.1 8.4 8.1 31.3 33.2
Port 38.9 41.9 29.5 30.9 68.4 72.8
Haulage - - 43.9 45.2 43.9 45.2
Other 20.4 25.6 31.0 30.1 51.4 55.7
Inter-segment cost (1.2) (1.2) (9.6) (8.2) (10.8) (9.4)
------------------------- ----- ----- ---------- ---------- ------ -----
Total other operating
costs 104.8 126.1 112.2 120.7 217.0 246.8
------------------------- ----- ----- ---------- ---------- ------ -----
iv) Statement of Financial Position
Ferries Container & Terminal Group Total
2020 2019 2020 2019 2020 2019
EURm EURm EURm EURm EURm EURm
Assets
Segment assets 341.4 391.1 87.1 89.8 428.5 480.9
Cash and cash equivalents 117.2 79.8 33.2 31.1 150.4 110.9
------------------------- ----- ----- ---------- ---------- ------ -----
Consolidated total assets 458.6 470.9 120.3 120.9 578.9 591.8
------------------------- ----- ----- ---------- ---------- ------ -----
Liabilities
Segment liabilities 48.2 34.6 25.9 29.4 74.1 64.0
Borrowings 190.7 183.3 48.2 56.6 238.9 239.9
------------------------- ----- ----- ---------- ---------- ------ -----
Consolidated total
liabilities 238.9 217.9 74.1 86.0 313.0 303.9
------------------------- ----- ----- ---------- ---------- ------ -----
Notes to the Condensed Financial Statements
for the year ended 31 December 2020 - continued
3. Income tax expense
2020 2019
EURm EURm
Current tax 1.2 1.2
Deferred tax (0.2) 0.1
---------------------------------- ----- ----
Income tax expense for the year 1.0 1.3
---------------------------------- ----- ----
The Company and its Irish tax resident subsidiaries have elected to be
taxed under the Irish 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 vessels utilised.
In accordance with the IFRIC guidance on IAS 12 Income Taxes, the
tonnage tax charge is not considered an income tax expense and has been
included in other operating expenses in the Consolidated Income
Statement.
Domestic income tax is calculated at 12.5% of the estimated assessable
profit for the year for all activities which do not fall to be taxed
under the tonnage tax system. Taxation for other jurisdictions is
calculated at the rates prevailing in the relevant jurisdictions. The
income tax expense for the year includes a current tax charge of EUR1.2
million and a deferred tax credit of EUR0.2 million.
The total expense for the year is reconciled to the accounting profit as
follows:
2020 2019
EURm EURm
(Loss) / profit before tax (18.0) 61.5
Tax at the domestic income tax rate of 12.5% (2019:
12.5%) - 7.7
Losses not eligible for surrender under loss provisions 1.9 -
Effect of tonnage relief (1.6) (6.8)
Difference in effective tax rates (0.3) 0.3
Items for which no tax deduction is available 0.8 -
Other items 0.2 0.1
-------------------------------------------------------- ------ -----
Income tax expense recognised in the Consolidated
Income Statement 1.0 1.3
-------------------------------------------------------- ------ -----
Notes to the Condensed Financial Statements
for the year ended 31 December 2020 - continued
4. Earnings per share
2020 2019
Number of shares '000 '000
Weighted average number of ordinary shares for the
purpose of basic earnings per share 186,981 189,797
Effect of dilutive potential ordinary shares: Share
options - 1,143
---------------------------------------------------- ------- -------
Weighted average number of ordinary shares for the
purpose of diluted earnings per share 186,981 190,940
---------------------------------------------------- ------- -------
The denominator for the purposes of calculating both basic and diluted
earnings per share has been adjusted to reflect shares issued during the
year and excludes treasury shares.
The earnings used in both the adjusted basic and adjusted diluted
earnings per share have been adjusted to take into account the net
interest on defined benefit pension obligations and the effect of
non-trading items after tax.
The prior year reported adjusted basic earnings per share and adjusted
diluted earnings per share has been represented to include the tax
effect on non-trading items.
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:
2020 2019
Earnings 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 (19.0) 60.2
Effect of non-trading items after tax 11.2 (14.9)
Effect of net interest income on defined benefit pension
schemes (0.2) -
Earnings for the purpose of adjusted earnings per
share (8.0) 45.3
--------------------------------------------------------- ------------------------------------------------------ ------
Cent Cent
--------------------------------------------------------- ------------------------------------------------------ ------
Basic earnings per share (10.2) 31.7
--------------------------------------------------------- ------------------------------------------------------ ------
Diluted earnings per share (10.2) 31.5
--------------------------------------------------------- ------------------------------------------------------ ------
Adjusted basic earnings per share (4.3) 23.8
--------------------------------------------------------- ------------------------------------------------------ ------
Adjusted diluted earnings per share (4.3) 23.7
--------------------------------------------------------- ------------------------------------------------------ ------
Diluted earnings per ordinary share
Diluted earnings per ordinary share is calculated by adjusting the
weighted average number of ordinary shares outstanding to assume the
exercise of all vested share option awards at 31 December. Share option
awards which have not yet satisfied the required performance conditions
for vesting are excluded from the calculation. The dilutive effect of
vested share options is calculated as the difference in the average
market value during the period and the option price expressed as a
percentage of the average market value. Of the 2,296,500 (2019:
2,496,500) vested options at 31 December 2020, the dilutive effect is
nil ordinary shares (2019: 1,143,000 ordinary shares).
Notes to the Condensed Financial Statements
for the year ended 31 December 2020 - continued
5. Non-trading items
2020 2019
EURm EURm
Non-trading (expense)/gain (11.2) 14.9
--------------------------- ------ ----
On 9 December 2020, the Trustee of the Group's principal defined benefit
pension scheme entered into a transaction whereby the liabilities
relating to pensions in payment at the transaction date were transferred
to a third-party insurer on payment of a premium of EUR160.6 million.
This gave rise to a non-cash settlement loss of EUR9.3 million being the
difference between the present value of the transferred liabilities
discounted at the AA corporate bond rate used for IAS 19 valuation
purposes at the transaction date and the premium paid.
The Trustee, in agreement with the Company, also augmented the pension
benefits of certain members resulting in an augmentation cost of EUR1.1
million being the present value of the future benefit changes.
The Group's subsidiary Irish Ferries Limited, the sponsoring employer of
the scheme, underwrites the schemes administration expenses and incurred
expenses totalling EUR0.8 million relating to the above transaction.
In the prior year the Group entered into a hire purchase agreement for
the sale of the vessel Oscar Wilde, which had become surplus to
operational requirements. The gross consideration of EUR28.9 million
less commissions, receivable in instalments over six years from April
2019, was discounted to estimated present value which has been treated
as a finance lease receivable. The Group recorded a net gain on disposal
of EUR14.9 million after taking account of the net book value at the
delivery date and related disposal costs.
6. Net cash and borrowing facilities
i) The components of the Group's net cash position at the reporting date
and the movements in the period are set out in the following table:
Bank Loan Lease Origination
Cash Loans Notes Obligations Fees Total
EURm EURm EURm EURm EURm EURm
At 1 January
2020
Current
assets 110.9 - - - - 110.9
Creditors due
within one
year - (3.7) - (8.4) 0.1 (12.0)
Creditors due
after one
year - (151.3) (50.0) (27.6) 1.0 (227.9)
------- -------- --------- ----------- ----------- -------
110.9 (155.0) (50.0) (36.0) 1.1 (129.0)
------------- ------- -------- --------- ----------- ----------- -------
Changes from
cash flows 39.5 3.7 - 10.0 - 53.2
Non-cash flow
changes:
Amortisation - - - - (0.2) (0.2)
Right of use
assets
recognised - - - (12.5) - (12.5)
Currency
adjustment - - - - - -
------------- ------- -------- --------- ----------- ----------- -------
39.5 3.7 - (2.5) (0.2) 40.5
------------- ------- -------- --------- ----------- ----------- -------
At 31
December
2020
Current
assets 150.4 - - - - 150.4
Creditors due
within one
year - (87.3) - (10.7) 0.1 (97.9)
Creditors due
after one
year - (64.0) (50.0) (27.8) 0.8 (141.0)
------------- ------- -------- --------- ----------- ----------- -------
150.4 (151.3) (50.0) (38.5) 0.9 (88.5)
------------- ------- -------- --------- ----------- ----------- -------
Notes to the Condensed Financial Statements
for the year ended 31 December 2020 - continued
6. Net cash and borrowing facilities - continued
ii) The maturity profile and available borrowing and cash facilities
available to the Group at 31 December 2020 are set out in the following
table:
Maturity Profile
Less
On-hand than Between Between More
/ 1 1 -- 2 2 -- 5 than 5
Facility Undrawn drawn year years years years
EURm EURm EURm EURm EURm EURm EURm
Cash - - 150.4 150.4 - - -
-------------------- -------- ------- ------- ----- ------- ------- --------
Committed lending
facilities
Bank overdrafts 15.4 15.4 - - - - -
Bank loans 226.3 75.0 151.3 87.5 7.5 22.6 33.7
Loan notes 50.0 - 50.0 - - 50.0 -
Origination fees (0.9) - (0.9) (0.2) (0.2) (0.4) (0.1)
Leases 38.5 - 38.5 10.7 4.7 7.4 15.7
-------------------- -------- ------- ------- ----- ------- ------- --------
Committed lending
facilities 329.3 90.4 238.9 98.0 12.0 79.6 49.3
-------------------- -------- ------- ------- ----- ------- ------- --------
Uncommitted lending
facilities
Bank loans 50.0
Loan notes 174.1
-------------------- -------- ------- ------- ----- ---------------- --------
Uncommitted lending
facilities 224.1
-------------------- -------- ------- ------- ----- ---------------- --------
Bank overdrafts facilities are stated net of trade guarantee facilities
utilised of EUR0.6 million.
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 the leased assets.
Notes to the Condensed Financial Statements
for the year ended 31 December 2020 - continued
7. Net cash inflow from operating activities
2020 2019
EURm EURm
Operating activities
(Loss)/profit for the financial year (19.0) 60.2
Adjustments for:
Finance costs (net) 7.6 3.4
Income tax expense 1.0 1.3
Retirement benefit schemes -- current service cost 1.7 1.5
Retirement benefit schemes -- settlement loss / curtailment
gain 9.3 (0.1)
Retirement benefit schemes -- augmentation cost 1.1 -
Retirement benefit schemes -- payments (2.8) (2.7)
Depreciation of property, plant and equipment 29.3 27.5
Depreciation of right-of-use assets 9.5 9.1
Impairment charge on cancellation of vessel contract 2.3 -
Amortisation of intangible assets 0.2 0.2
Share-based payment expense less market purchase cost 0.2 1.9
Gain on disposal of property, plant and equipment - (15.1)
Increase in provisions 0.2 0.3
------------------------------------------------------------ ------ ------
Operating cash flow before movements in working capital 40.6 87.5
Decrease in inventories 1.2 0.2
Decrease/(increase) in receivables 1.6 (4.7)
Increase in payables 7.8 6.5
------------------------------------------------------------ ------ ------
Cash generated from operations 51.2 89.5
Income taxes paid (1.4) (1.2)
Interest paid (3.7) (3.5)
------------------------------------------------------------ ------ ------
Net cash inflow from operating activities 46.1 84.8
------------------------------------------------------------ ------ ------
Working capital movements exclude prepayments relating to contractual
terms for works not yet undertaken of EUR2.6 million (2019: EUR37.0
million). Movements in these accruals and prepayments are included as
purchases of property plant and equipment in the Condensed Consolidated
Statement of Cash Flows.
8. Retirement benefit schemes
The principal assumptions used for the purpose of the actuarial
valuations were as follows:
2020 2019
Sterling Euro Sterling Euro
Discount rate 1.30% 0.70% 1.85% 1.00%
Inflation rate 3.15% 1.20% 3.20% 1.30%
Rate of increase of
pensions in payment 3.05% 0.30% - 0.40% 2.95% 0.40% -- 0.50%
Rate of pensionable salary
increases 0.95% 0.00% - 0.90% 0.90% 0.00% -- 0.90%
--------------------------- -------- ------------- -------- --------------
Notes to the Condensed Financial Statements
for the year ended 31 December 2020 - continued
8. Retirement benefit schemes - continued
The average life expectancy used in all schemes at age 60 is as follows:
2020 2019
Male Female Male Female
Current retirees 26.5 years 29.5 years 26.4 years 29.3 years
Future retirees 28.9 years 31.5 years 28.8 years 31.4 years
---------------- ---------- ---------- ---------- -----------
The amount recognised in the balance sheet in respect of the Group's
defined benefit obligations, is as follows:
Schemes with Liabilities in Schemes with Liabilities in
Sterling Euro
2020 2019 2020 2019
Equities 10.9 11.6 62.9 105.8
Bonds 13.3 13.0 28.2 102.7
Diversified funds - - - 41.7
Property - 0.3 4.8 19.2
Insurance
contracts - - 12.3 -
Other 3.1 2.9 4.1 1.2
------------------ ------------- ------------- ------------- -------------
Market value of
scheme assets 27.3 27.8 112.3 270.6
Present value of
scheme
liabilities (28.0) (26.2) (112.8) (263.4)
------------------ ------------- ------------- ------------- -------------
(Deficit)/surplus
in schemes (0.7) 1.6 (0.5) 7.2
------------------ ------------- ------------- ------------- -------------
The movement during the year is reconciled as follows:
2020 2019
Movement in retirement benefit schemes net surplus
/ (deficit) EURm EURm
Opening surplus/(deficit) 8.8 (1.7)
Current service cost (1.7) (1.5)
(Settlement loss) / curtailment gain (9.3) 0.1
Augmentation cost (1.1) -
Employer contributions paid 2.8 2.7
Net interest income 0.2 -
Actuarial (loss) / gain (0.8) 9.0
Other (0.1) 0.2
--------------------------------------------------- ----- ---------------------------------
Net (deficit)/surplus (1.2) 8.8
--------------------------------------------------- ----- ---------------------------------
Schemes in surplus 1.0 12.5
Schemes in deficit (2.2) (3.7)
--------------------------------------------------- ----- ---------------------------------
Net (deficit) / surplus (1.2) 8.8
--------------------------------------------------- ----- ---------------------------------
9. Related party transactions
Transactions between the company and its subsidiaries, which are related
parties, have been eliminated on consolidation.
During the year ended 31 December 2020 the material transactions between
Irish Continental Group plc and its key management personnel were the
remuneration of employees and Directors and the provision of
professional services at arm's length basis.
Notes to the Condensed Financial Statements
for the year ended 31 December 2020 - continued
10. General information
The Condensed Financial Statements in this preliminary announcement do
not constitute full statutory financial statements ("Financial
Statements"), a copy of which is required to be annexed to the annual
return to the Companies Registration Office. A copy of the financial
statements in respect of the financial year ended 31 December 2020 will
be annexed to the annual return for 2020. The auditors have made a
report, without any qualification on their audit, of the financial
statements in respect of the financial year ended 31 December 2020 and
the Directors approved the financial statements in respect of the
financial year ended 31 December 2020 on 10 March 2021. A copy of the
financial statements in respect of the year ended 31 December 2019 has
been annexed to the annual return for 2020 filed at the Companies
Registration Office.
The financial statements have been prepared in accordance with IFRS as
adopted by the European Union and therefore the Group's financial
statements comply with Article 4 of the IAS Regulations. The
consolidated financial statements have also been prepared in accordance
with the Companies Act 2014, and the Listing Rules of Euronext Dublin
and the UK Listing Authority.
The financial statements have been prepared on the historical cost
basis.
Certain financial measures set out in our Preliminary Statement of
Results for the year ended 31 December 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
Company'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
interest, tax, depreciation, impairment of financing and accounting
and amortisation. decisions to allow assessment
of the profitability
and performance of the
Group.
-------------------- ---------------------------------------- ------------------------------
EBIT EBIT represents earnings before interest Measures the Group's
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
capital expenditure before strategic capital expenditure for reinvestment or for
which comprises expenditure on vessels return to shareholders.
excluding annual overhaul and repairs,
and 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.
-------------------- ---------------------------------------- ------------------------------
Terms and abbreviations
------------------------------------------------------------------------------
teu 20 foot equivalent unit, an industry standard measurement
for container units.
----------- -----------------------------------------------------------------
RoRo unit Roll on, Roll off freight unit of any length either accompanied
or unaccompanied carried on Ropax ferries.
----------- -----------------------------------------------------------------
LoLo unit Lift on, Lift off container unit of any size.
----------- -----------------------------------------------------------------
Ropax A cruise ferry capable of carrying both passengers and RoRo
freight.
----------- -----------------------------------------------------------------
Non-trading Non-trading items are material non-recurring items that
item 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.
----------- -----------------------------------------------------------------
ICG Unit ICG Unit is a stock exchange trading unit of ICG equity
with each unit comprising one ordinary share and up to ten
redeemable shares (if any in issue).
----------- -----------------------------------------------------------------
11. Events after the Reporting Date
The Board is not proposing a final dividend in respect of the results
for the year ended 31 December 2020.
There have been no material events affecting the Group since 31 December
2020.
Notes to the Condensed Financial Statements
for the year ended 31 December 2020 - continued
12. Board Approval
This preliminary announcement was approved by the Board of Directors of
Irish Continental Group plc. on 10 March 2021.
13. Annual Report and Annual General Meeting
The Group's Annual Report and notice of Annual General Meeting, which
will be held on Wednesday 12 May 2021, will be notified to shareholders
in April 2021.
(END) Dow Jones Newswires
March 11, 2021 02:00 ET (07:00 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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