Friday 23 February 2018

Ferry group ICG buoyant despite UK Brexit vote

ICG logo
ICG logo
John Mulligan

John Mulligan

Tourist bookings on Irish Ferries have recovered following a decline caused by June's Brexit vote, according to owner Irish Continental.

The ferry group said that its revenue rose 5.2pc to €150.2m in the first six months of the year, while earnings before interest, tax, depreciation and amortisation were 19.6pc higher at €30.5m.

Chairman John McGuckian also said that despite the Brexit vote, Irish Continental (ICG) remains positioned to capitalise on an improving economy.

"The UK referendum result has, to date, had very little impact on roll-on/roll-off freight volumes which remain strong," he said. "Notwithstanding the impact of weaker sterling, ICG is well-placed to benefit from the underlying growth trends in both car and freight volume."

He added that tourist carryings over the key summer months were broadly in line with expectations, but that weaker sterling has resulted in lower euro equivalent tourist yields.

ICG - which operates ferries across the Irish Sea and to France - said that it carried 170,500 cars in the first six months of the year, which was 5.5pc higher than in the first half of 2015.

It handled just under 689,000 passengers, which was 1.9pc lower than in the first six months of last year.

Roll on/roll-off freight volumes were 5.6pc higher at 139,100 units.

Container volumes shipped in the period climbed 7.4pc to 152,700 TEUs. A TEU is a standard container.

The group, whose chief executive is Eamonn Rothwell, said that the continued recovery in the Irish economy and lower global fuel prices have been positive for it.

But it added that those positive benefits have been partially offset by reduced fuel surcharges to customers, and increased exchange rate volatility.

Its fuel costs tumbled 36.1pc to €13.3m in the first-half. It said that the decline in US dollar-denominated oil prices was offset by a stronger dollar versus the euro.

Apart from its activities here, ICG also charters a number of vessels to customers.

It has a ship on charter to KiwiRail in New Zealand, while a container ship is on charter in Europe.

Another ship, the HSC Westpac Express, is being used by the US Marines in Asia.

ICG announced in May that it has signed an agreement with a German shipmaker, which will build a €144m vessel for the Irish group. It's scheduled for delivery in 2018.

ICG's net debt at the end of June was €18.9m, which was down from €44.3m at the end of December.

Davy Stockbrokers analyst Stephen Furlong said the figures achieved by ICG were strong, despite some discounting by the group in the car market.

However, he said he would "modestly trim" his outlook for ICG's full-year earnings before interest, tax, depreciation and amortisation, from €85.2m to €83m.

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