Irish Continental cuts operating loss in half
Ferry group Irish Continental cut its operating loss by nearly 55pc to €1.1m in the first four months of the year, but its interest bill soared to €2m from €800,000 in the period.
In an interim management statement, the company, which trades as Irish Ferries, said it carried 418,100 passengers in the 19 weeks to May 11 – 1.5pc fewer than it did in the corresponding period last year.
Car traffic fell 5.5pc to 85,000, but roll-on roll-off freight levels jumped 6.4pc to 71,000 units. Container freight also rose, climbing 10pc to 102,100 TEUs, the standard industry measure.
The company, headed by chief executive Eamonn Rothwell, said that although it carried fewer cars, the yields on those it did were higher in the period.
In the first four months of 2013, revenue rose to 2.4pc to €72.1m from €70.4m in the first third of 2012. Earnings before interest, tax, depreciation and amortisation rose 26.3pc to €4.8m in the period.
Irish Continental said that operating costs before depreciation and amortisation rose 1.1pc to €67.3m, while non-fuel costs were 4pc higher at €2m due to volume-related port costs and additional variable costs in its container division.
Its interest bill rose after it spent €111m last year buying back about 25pc of its stock. The company's net debt jumped to €116m at the end of March from €7.8m a year earlier after it borrowed €110m to initiate the share buyback.
Analyst Ross Harvey at Davy Stockbrokers said that ICG had a "fuel headwind" in the first quarter and that if the benefit is annualised in line with fuel prices normalising, up to €4m could be added to ICG's EBITDA for the full year.
"The business is weighted more towards the second half of the year, however, and our forecasts are unlikely to change," he added.