Tuesday 20 February 2018

Irish Ferries sails to record €83m earnings despite Brexit

ICG boss Eamonn Rothwell. Photo: Mac Innes
ICG boss Eamonn Rothwell. Photo: Mac Innes
John Mulligan

John Mulligan

Ferry operator Irish Continental said that weaker sterling had been a "significant headwind" for the group during 2016, but it still managed to deliver record earnings of €83.5m.

Headed by chief executive and former stockbroker Eamonn Rothwell, the company operates under brands including Irish Ferries. Mr Rothwell owns 14.8pc of the company, a stake valued at about €138m.

The group - by far the dominant passenger and freight operator across the Irish Sea - said that its revenue rose 1.5pc to €325.4m last year. But it noted that the slump in sterling after last June's Brexit vote did hit the business during its peak summer season.

"The weakening of sterling reduced our averaged tourism yields," it noted, adding that the impact was partially offset by a reduction in sterling-denominated costs.

Irish Continental said that car volumes rose 3.3pc last year to 414,100. But they rose 5.5pc in the first half of the year and by just 1.8pc in the second half, which includes the busy summer season. Its passenger numbers declined 3.2pc to 1.62 million.

It also pointed out that its car volumes have fallen 2pc in year-to-date, but attributed that to a 70pc decline in the number of its fast-craft sailings across the Irish Sea due to an extended dry dock period.

The company operates vessels such as the Ulysses and the Jonathan Swift across the Irish Sea, but also sails routes to France and has vessels out on charter. One such vessel is in use in New Zealand, and another is being used by the US Marines in Asia.

Last year, Irish Continental announced that it had placed an order for a new passenger ship at a cost of €144m. It will be able to carry up to 1,885 passengers and crew, and 165 trucks and 300 cars. The ship is due for delivery in 2018.

Irish Continental's ferries division posted revenue of €209.9m last year, a 2.9pc increase. Earnings before interest, depreciation and amortisation (ebitda) was 11pc higher at €70.7m. Although the company is exposed to the potential downside from last June's UK Brexit vote, Davy Stockbrokers analyst Stephen Furlong said the referendum outcome gives potential investors in the ferry firm an "excellent entry point" into what he described as one of the "best-managed" transport companies in Europe.

He predicted that the company will post group ebitda of €81.7m this year.

Apart from its Irish Ferries brand, Irish Continental also operates the Eucon container and terminal business, which includes five charted vessels. It operates freight services between Ireland and the Netherlands.

At the container and terminal unit, revenue rose 4.8pc to €123.9m, while ebitda was 8.5pc higher at €12.8m. The volume of trucks and trailers carried by the ferries unit rose 7pc last year to 952,000.

On an all-island basis, the figure was up 5.8pc to 1.75m.

At its Eucon unit, the number of containers shipped increased by 6pc to 303,600 teu (Twenty-Feet Equivalent Unit - a standard industry measure for a container size).

Irish Independent

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