Regulatoriskt pressmeddelande

Viking Line Abp: Viking Line: Half year financial report January - June 2024

Viking Line Abp HALF YEAR FINANCIAL REPORT 15.08.2024, 9.00 AM
A half-year characterized by weaker demand

JANUARY-JUNE 2024

(compared to January-June 2023)

Sales amounted to EUR 219.1M(EUR 226.3 M).
Other operating revenue was EUR 0.6M(EUR 8.9M, including the EUR 8.6 M capital gain from the sale of Rosella.)
Operating income totalled EUR -4.3M(EUR 17.1M, including the EUR 8.6 M capital gain from the sale of Rosella.)
Net financial items were EUR -8.1M(EUR -7.7M).
Income before taxes totalled EUR -12.4M(9.4M, including the EUR 8.6 M capital gain from the sale of Rosella.)
Income before taxes totalled EUR -12.5M(EUR 7.2M, including the EUR 8.6 M capital gain from the sale of Rosella.)
Investments mainly in Viking Cinderella and Birka Gotland totalled EUR 15.4 M (EUR 7.7 M).

Outlook for the full financial year 2024

The Board of Directors has decided to revise its earnings forecast for 2024. Income during the peak season - from June to August, when most of the company's income is generated - is forecast to be on a par with the strong figure posted for the same period in 2023. Initial traffic for Birka Gotland has not met the company's expectations and has entailed higher start-up costs than expected. In addition, Viking Glory's dry-docking and Viking Grace's and Gabriella's cancelled departures had a negative impact on sales and earnings in the second quarter.

There is significant uncertainty due to the recession under way in Finland, which has a negative impact on customers' consumption patterns. The current geopolitical situation and its potential impact mostly on energy prices are also a factor contributing to this uncertainty.

In view of this, the Board expects that income before taxes in 2024 will be weaker than in 2023 if the EUR 8.6 M capital gain from the sale of Rosella in 2023 is not included.

On April 22, 2024, the outlook was:

Provided that energy prices remain at current levels and people's propensity to travel is sustained, the Board of Directors expects that income before taxes in 2024 will be on a par with the figure for 2023 if the EUR 8.6 M capital gain from the sale of Rosella in 2023 is included.

SECOND QUARTER OF 2024

(compared to the second quarter of 2023)

Sales amounted to EUR 125.9M(EUR 132.4 M).
Other operating revenue was EUR 0.2M(EUR 0.1M).
Operating income totalled EUR 6.2M(EUR 18.0M).
Net financial items were EUR -4.3M(EUR -3.9M).
Income before taxes totalled EUR 1.8M(EUR 14.0M).
Income after taxes was EUR 1.8M(EUR 11.1M).

COMMENTS FROM PRESIDENT AND CEO JAN HANSES

Results for the first six months of the year were characterized by consumer caution. The Finnish economy is in recession and the recovery is going slowly. While inflation in Finland has eased, this is not reflected so far in consumer behaviour. The weak Swedish krona has reduced purchasing power in the Swedish market.

The launch of Gotland Alandia Cruises has entailed additional one-off costs while occupancy rates during the period up to June did not meet our expectations. Occupancy rates have improved during the summer and are expected to remain at a good level during the autumn.

In April, Viking Glory was dry-docked. The date for the dry-docking, originally planned for January 2025, was moved up. In addition, Viking Grace and Gabriella both had unplanned service disruptions in April and May.

Results for the first six months of the year excluding one-off items and particularly for the second quarter were thus weaker than expected.However, it is gratifying that ticket proceeds reached our targets, so we have been able to offset the cost of emission allowances, which are to be surrendered starting on in 2024. The geopolitical situation, with war in nearby regions, has not had any noticeable impact on people's propensity to travel but contributes to continued uncertainty about energy prices.

Results for the 2024 peak season are on a par with results for the same period last year, while our outlook for the autumn is characterized by some degree of uncertainty.

Maritime transport is being impacted at present by future environmental standards. Starting this year, our operations are subject to the EU Emissions Trading System, which means that we are now obliged to shoulder the cost of emission allowances, which in the medium term we can only partly offset through our continued energy efficiency work. The lack of alternative fuels at realistic prices is the greatest challenge for the industry.Viking Line works actively for reduced emissions in various projects. Passengers and cargo customers on the Turku-Mariehamn/Långnäs-Stockholmroute can now reduce their climate impact by purchasing renewable biofuel in proportion to the amount used for their travel and thus reduce carbon dioxide emissions from their journey by up to 90 per cent.Viking Line is also taking part in two major projects where work is being carried out to create green transport corridors for the Helsinki-Tallinn and Turku-Åland-Stockholm routes.

The first six months of 2024 have entailed changes in our operations, with expanded service between Finland and Sweden and the launch of cruise service in partnership with Gotlandsbolaget. This has entailed changes for our staff in the form of switches to our other vessels and reflaggings. Because of these changes, we have been able to hire new staff since the number of vessels in the fleet has increased

I would like to extend my warm thanks to our customers and partners for the faith they have shown in us and their good cooperation. I would also like to give a big thank you to our staff for their fine performance during this period.

KEY METRICS, SUMMARY

Apr 1, Apr 1, 2023- Jan 1, 2024- Jan 1, 2023- Jan 1, 2023-
2024-
EUR M Jun Jun 30, 2023 Jun 30, 2024 Jun 30, 2023 Dec 31, 2023
30,
2024

Sales 125.9 132.4 219.1 226.3 491.4
Other 0.2 0.1 0.6 8.9 9.1
operating
revenue
Operating 6.2 18.0 -4.3 17.1 55.0
income
Income 1.8 14.0 -12.4 9.4 45.4
before
taxes
Income for 1.8 11.1 -12.5 7.2 36.3
the period

SERVICE AND MARKET

During most of the report period, the Viking Line Group provided passenger and cargo carrier services using five vessels in the northern Baltic Sea and the Gulf of Finland. On March 20, the vessel Birka Gotland, which Viking Line owns jointly with Gotlandsbolaget, launched cruise service from Stockholm. Prior to the launch, the vessel underwent a major dry-docking and upgrade.

Viking Cinderella was dry-docked during the period January 1 to January 19. After this, it returned to making day cruises between Stockholm and Mariehamn until March 4, and then on March 8 began service on the Helsinki-Mariehamn-Stockholm route. Viking Cinderella was out of service for four days in conjunction with its removal from the Swedish Register of Ships on March 5 and its entry in the Åland Register of Ships. Since March 5, the vessel has sailed under a Finnish flag.

Viking Glory was dry-docked during the period April 8 to April 17. From April 11 to April 17, it was replaced in service by Viking Cinderella on the Turku-Mariehamn/Långnäs-Stockholm route. Both Viking Grace and Gabriella also cancelled departures due to unplanned technical maintenance

During the first half of 2023, Rosella served between Mariehamn and Kapellskär until January 8, when it was taken out of service. Viking XPRS was out of service for three days in conjunction with its removal from the Estonian Register of Bare-Boat Charterers on March 6, 2023, and entry in the Åland Register of Ships. Since March 6, the vessel has sailed under a Finnish flag., Viking Grace was also dry- docked last year during the comparative period.

The total number of passengers on the Group's vessels during the report period was 2,062,271 (2,185,843). The Group had a total market share in its service area of approximately 33.0% (34.8%). The number of passengers on Birka Gotland since the launch of service was 139,062.

Market demand for travel in the company's service area as a whole softened during the first six months of the year. We noted a weakening in demand for service between Finland and Sweden, while traffic between Finland and Estonia increased somewhat. Tighter household finances and a weak Swedish krona adversely affected the chances of increasing occupancy rates and capacity utilization during the first half of the year.

The period includes disruptions in service, in the form of vessel dry-dockings for both Viking Line and its competitors, which affects comparative figures.

The Group's total cargo volume was 66,385 cargo units (64,872). The Group's share of the cargo market was approximately 16.8% (16.9%). The growth in volume is directly linked to increased demand for transport in the international transport market at the end of the period. The increase in cargo volumes is due to an improved economic outlook for Finland's most important export markets and for global trade. During the period, political strikes in Finland had a negative impact on transport. However, with expanded service on its Helsinki-Mariehamn-Stockholm route, Viking Line was able to increase cargo volumes compared to previous years.

The market share for passenger cars was approximately 28.5% (27.3%).

SALES AND EARNINGS FOR JANUARY - JUNE 2024

Consolidated sales decreased 3.2% to EUR 219.1 M during the period January 1-June 30, 2024 (EUR 226.3 M January 1-June 30, 2023). Operating income totalled EUR -4.3 M (EUR 17.1 M). Consolidated income before tax was EUR -12.4 M (EUR 9.4 M). The comparative figures include the capital gain from the sale of Rosella, which was EUR 8.6 M. Income before tax excluding the capital gain in 2023 is EUR 0.8 M. It should also be noted that demand in our service area was weaker than expected. Birka Gotland's initial traffic has not met the company's expectations, with weak sales and earnings as a result. Higher start-up costs also had a negative impact on sales and earnings. Viking Glory's dry-docking and Viking Grace's and Gabriella's cancelled departures also had a negative impact.

Passenger-related revenue decreased 4.3% to EUR 192.3 M (EUR 201.1 M), while cargo revenue was EUR 25.2 M (EUR 23.6 M) and other operating revenue was EUR 1.6 M (EUR 1.6 M). The sales contribution was EUR 170.4 M (EUR 172.4 M).

Operating expenses increased 6.3% to EUR 160.2 M (EUR 150.7 M). Salary and other employment benefit expenses increased 12.2% or EUR 6.5 M. Other operating expenses increased 3.1% or EUR 3.0 M.

SALES AND EARNINGS FOR THE SECOND QUARTER OF 2024

Consolidated sales decreased 4.9% to EUR 125.9 M during the period April 1- June 30, 2024 (EUR 132.4 M April 1-June 30 2023). Operating income totalled EUR 6.2 M (EUR 18.0 M). Birka Gotland's initial traffic has not met the company's expectations, with weak sales and earnings as a result. Viking Glory's dry-docking and Viking Grace's and Gabriella's cancelled departures also had a negative impact.

Passenger-related revenue decreased 6.7% to EUR 112.6 M (EUR 120.7 M), while cargo revenue was EUR 12.5 M (EUR 10.9 M) and other operating revenue was EUR 0.8 M (EUR 0.8 M). The sales contribution was EUR 98.7 M (EUR 101.1 M).

Operating expenses increased 11.3% to EUR 85.1 M (EUR 76.4 M). Salary and other employment benefit expenses increased 10.3% or EUR 3.0 M while other operating expenses increased 11.9% or EUR 5.7 M.

INVESTMENTS AND FINANCING

The Group's investments for the period January 1 to June 30, 2024, totalled EUR 15.4 M (EUR 7.7 M). The Group's total investments represented 7.0% of sales (3.4%). Most of these investments are related to the dry-docking of Viking Cinderella, which underwent extensive refurbishment. This investment underscores our commitment to keeping the vessel in service and in our fleet for many years to come. The other major investment is related to Birka Gotland and its launch in service. This is a joint venture with Gotlandsbolaget, with each company financing 50% of the investment. Viking Glory was also dry-docked during the period.

The Group's long-term interest-bearing liabilities on June 30, 2024, totalled EUR 133.1 M (EUR 168.5 M).

The debt/equity ratio was 49.2% compared to 47.8% for the same period last year.

The Group's cash and cash equivalents at the end of June totalled EUR 58.0 M (EUR 97.7 M). Unutilized credit lines in the Group totalled EUR 22.1 M (EUR 0.1 M).

Net cash flow from operating activities was EUR 23.3 M (EUR 30.7 M). Net cash flow from investing activities was EUR -13.6 M (EUR 4.5 M) and net cash flow from financing activities was EUR -37.0 M (EUR -26.6 M).

Most of the Group's loan agreements include loan covenants according to market terms. The financial covenants in the loan agreements consist of minimum requirements for liquidity and solvency and a maximum net financial debt-to-EBITDA ratio.

The dividend restriction in one of the Group's loan agreements continues to apply in the event the Group's debt-to-EBITDA ratio exceeds 5.0. The Group's debt-to-EBITDA ratio is below 5.0, so the dividend restriction does not apply.

ORGANIZATION AND PERSONNEL

The average number of full-time employees in the Group was 2,305 (2,138), 1,848 (1,611) of whom worked for the parent company. Land-based personnel totalled 459 (469) and shipboard personnel totalled 1,846 (1,669). On March 5, Viking Cinderella was reflagged from a Swedish to a Finnish flag.

During the period, 193 people employed by one of Viking Line Abp's subsidiaries were assigned to work at the joint venture Gotland Alandia Cruises AB, which provides cruise service with the vessel Birka Gotland. Staff contracted out by Viking Line were mainly catering staff.

During the comparative period, Viking XPRS hired an average of 65 people employed by a staffing company in addition to Viking Line's own personnel. Since its reflagging on March 6, 2023, the vessel is only staffed with Viking Line's own personnel.

RISK FACTORS

Viking Line's operations are exposed to different kinds of risks, which vary in their scope and impact on operations, financial results and the company's ability to meet certain social and environmental objectives. The relevant risks have been classified into four categories: strategic, operational, damage and financial risks. The risks continue to be the same as when the company's year-end financial statements were published.

Fluctuations in bunker (vessel fuel) prices have an indirect impact on the Group's earnings. To partly offset the risk of higher bunker prices, on June 30, 2024, the Group had fixed price agreements entered into for bunker purchases in effect from the start of the year to July 2024.

Since January 1, 2024, Viking Line records and recognizes emission allowance costs in accordance with the EU Emission Trading System for greenhouse gases (ETS). The company must surrender its first emission allowances by September 30, 2025. To reduce its price risk, Viking Line has started to purchase emission allowances. The company's strategy until further notice is to purchase emission allowances on a regular basis in order to achieve a cost effect corresponding to the average price and use.

The company's interest-bearing liabilities amounted to EUR 169.8 M as of June 30, 2024, 83.6% of which have a variable interest rate. The total variable interest rate consists of the market interest rate plus a margin that is specific to the company. Fluctuations in interest rates can have a negative effect on the company's costs of funding and increase funding costs in the future.

OUTLOOK FOR THE FINANCIAL YEAR 2024

In view of this, the Board expects that income before taxes in 2024 will be weaker than in 2023 if the EUR 8.6 M capital gain from the sale of Rosella in 2023 is not included.

On April 22, 2024, the outlook was:

EVENTS AFTER THE BALANCE SHEET DATE

The Board of Directors knows of no events after the balance sheet date that could affect this financial report.

Mariehamn, August 15, 2024

VIKING LINE ABP

The Board of Directors
Jan Hanses
President and CEO

Financial information

The management's Half-Year Financial Report Review was prepared in accordance with IFRS accounting and valuation principles. The accounting and valuation principles applied are the same as for the year-end financial statements for 2023. The figures have not been audited.

CONSOLIDATED INCOME STATEMENT

Apr 1, Apr 1, Jan 1, Jan 1, Jan 1,
2024- 2023- 2024- 2023- 2023-
EUR M Note Jun Jun Jun Jun Dec
30, 30, 30, 30, 31,
2024 2023 2024 2023 2023

SALES 4 125.9 132.4 219.1 226.3 491.4

Other operating revenue 5 0.2 0.1 0.6 8.9 9.1

Expenses
Goods and services 27.3 31.3 48.8 53.9 113.7
Salary and other employment 6 31.6 28.6 59.6 53.1 108.5
benefit expenses
Depreciation, amortization 7 7.6 6.8 15.1 13.5 27.5
and impairment losses
Other operating expenses 8 53.5 47.8 100.5 97.6 195.9
119.9 114.5 224.0 218.0 445.5

OPERATING INCOME 6.2 18.0 -4.3 17.1 55.0

Financial income 0.5 0.6 1.4 0.9 2.8
Financial expenses 9 -2.8 -3.4 -6.2 -6.2 -11.8
Share of after-tax income -2.0 -1.1 -3.2 -2.3 -0.6
from joint ventures and
companies with a
participating interest
undertaking
accounted for using the
equity method

INCOME BEFORE TAXES 1.8 14.0 -12.4 9.4 45.4

Income taxes -0.1 -2.9 -0.1 -2.3 -9.2

INCOME FOR THE PERIOD 1.8 11.1 -12.5 7.2 36.3

Income attributable to:
Parent company shareholders 1.8 11.1 -12.5 7.2 36.3

Earnings per share before and 0.10 0.64 -0.72 0.42 2.10
after dilution, EUR

CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME

Apr 1, Apr 1, Jan 1, Jan 1, Jan 1,
2024- 2023- 2024- 2023- 2023-
EUR M Jun Jun Jun Jun Dec
30, 30, 30, 30, 31,
2024 2023 2024 2023 2023

INCOME FOR THE PERIOD 1.8 11.1 -12.5 7.2 36.3

Items that may be
reclassified to the income
statement
Translation differences 0.3 -1.3 -0.6 -1.6 0.0

Items that will not be
reclassified to the income
statement
Changes in the fair value of
financial assets at fair
value
through other comprehensive 0.0 - 0.0 - 1.5
income

Other comprehensive income 0.3 -1.3 -0.6 -1.6 1.5

COMPREHENSIVE INCOME FOR THE 2.1 9.8 -13.0 5.5 37.8
PERIOD

Comprehensive income
attributable to:
Parent company shareholders 2.1 9.8 -13.0 5.5 37.8

CONSOLIDATED BALANCE SHEET

EUR M Note Jun Jun Dec
30, 30, 31,
2024 2023 2023

ASSETS

Non-current assets
Intangible assets 6.8 4.1 5.4
Land 0.5 0.5 0.5
Buildings and structures 1.6 1.6 1.6
Renovation costs for rented 1.0 0.9 0.9
properties
Vessels 433.2 421.9 435.3
Machinery and equipment 2.6 2.5 2.6
Right-of-use assets 3.9 4.0 4.7
Financial assets at fair
value through
other comprehensive income 0.0 10.8 0.0
Investments accounted for 12 47.0 32.4 49.8
using the equity method
Receivables 0.5 0.7 0.6
Total non-current assets 497.0 479.6 501.5

Current assets
Inventories 15.0 14.4 12.7
Income tax assets 0.1 0.1 0.1
Trade and other receivables 13 55.5 47.0 40.1
Cash and cash equivalents 58.0 97.7 85.3
Total current assets 128.7 159.2 138.3

TOTAL ASSETS 625.8 638.8 639.8

EQUITY AND LIABILITIES

Equity
Share capital 1.8 1.8 1.8
Reserves 49.7 49.7 49.7
Translation differences -3.5 -4.3 -3.2
Retained earnings 244.9 243.8 275.0
Equity attributable to parent 292.9 291.0 323.2
company shareholders

Total equity 292.9 291.0 323.2

Non-current liabilities
Deferred tax liabilities 10 45.2 37.0 45.2
Interest-bearing liabilities 133.1 168.5 150.6
Lease liabilities 2.9 4.0 4.0
Other payables 1.8 - 2.3
Total non-current liabilities 183.1 209.5 202.1

Current liabilities
Interest-bearing liabilities 36.7 36.7 36.7
Lease liabilities 2.7 2.4 2.7
Income tax liabilities 0.0 1.0 0.0
Trade and other payables 110.4 98.2 75.1
Total current liabilities 149.8 138.3 114.5

Total liabilities 332.8 347.8 316.6

TOTAL EQUITY AND LIABILITIES 625.8 638.8 639.8

CONSOLIDATED CASH FLOW
STATEMENT

Jan 1, Jan 1, Jan 1,
2024- 2023- 2023-
EUR M Jun Jun Dec
30, 30, 31,
2024 2023 2023

OPERATING ACTIVITIES

Income for the period -12.5 7.2 36.3
Adjustments
Depreciation, amortization 15.1 13.5 27.5
and impairment losses
Capital gains/losses from 0.0 -8.9 -8.9
non-current assets
Income from investments in 3.2 2.3 0.6
associate companies
Other items not included in -0.5 -0.4 -0.7
cash flow
Interest expenses and other 6.1 5.3 11.2
financial expenses
Interest income and other -1.0 -0.8 -2.7
financial income
Dividend income - 0.0 0.0
Income taxes 0.1 2.3 9.2

Change in working capital
Change in trade and other -15.4 -10.2 -3.4
receivables
Change in inventories -2.3 -0.4 1.3
Change in trade and other 35.1 25.1 4.3
payables

Interest paid -5.3 -4.5 -10.0
Financial expenses paid -0.3 -0.2 -0.3
Interest received 0.8 0.6 2.7
Financial income received 0.2 0.1 0.0
Taxes paid -0.1 -0.2 0.0

NET CASH FLOW FROM OPERATING 23.3 30.7 67.1
ACTIVITIES

INVESTING ACTIVITIES
Investments in vessels -11.2 -5.2 -28.8
Investments in other -2.2 -2.3 -4.5
intangible assets, property,
plant and equipment
Investments in financial
assets recognized at fair
value
through other comprehensive - -0.2 -
income
Investments accounted for -2.0 - -3.6
using the equity method
Divestments of vessels - 11.1 11.1
Divestments of other non 0.0 0.1 0.2
-current assets
Change in non-current 0.1 -0.7 -0.6
receivables
Dividends received from 1.7 1.7 1.7
associate companies
Dividends received from - 0.0 0.0
others

NET CASH FLOW FROM INVESTING -13.6 4.5 -24.5
ACTIVITIES

FINANCING ACTIVITIES
Principal payments -18.3 -18.4 -36.8
Depreciation of lease -1.4 -1.3 -2.6
liabilities
Dividends paid -17.3 -6.9 -6.9

NET CASH FLOW FROM FINANCING -37.0 -26.6 -46.3
ACTIVITIES

CHANGE IN CASH AND CASH -27.3 8.7 -3.7
EQUIVALENTS
Cash and cash equivalents at 85.3 89.0 89.0
the beginning of the period

CASH AND CASH EQUIVALENTS AT 58.0 97.7 85.3
THE END OF THE PERIOD

STATEMENT OF CHANGES IN
CONSOLIDATED EQUITY

Equity
attributable
to parent
company
shareholders

Share Translation Retained Total
EUR M capital Reserves differences earnings equity

EQUITY, JAN 1, 2024 1.8 49.7 -3.2 275.0 323.2

Income for the period -12.5 -12.5
Translation differences 0.0 -0.2 -0.3 -0.6
Remeasurement of
financial assets
recognized at
fair value through 0.0 - 0.0
other comprehensive
income
Comprehensive income - 0.0 -0.2 -12.8 -13.0
for the period

Dividend to -17.3 -17.3
shareholders
Transactions with - - - -17.3 -17.3
owners of the parent
company

EQUITY, JUN 30, 2024 1.8 49.7 -3.5 244.9 292.9

Equity
attributable
to parent
company
shareholders

Share Translation Retained Total
EUR M capital Reserves differences earnings equity

EQUITY, JAN 1, 2023 1.8 49.7 -3.4 244.3 292.4

Income for the period 7.2 7.2
Translation differences 0.0 -0.9 -0.8 -1.6
Remeasurement of
financial assets
recognized at
fair value through -
other comprehensive
income
Comprehensive income - 0.0 -0.9 6.4 5.5
for the period

Dividend to -6.9 -6.9
shareholders
Transactions with - 0.0 - -6.9 -6.9
owners of the parent
company

EQUITY, JUN 30, 2023 1.8 49.7 -4.3 243.8 291.0

CONSOLIDATED INCOME STATEMENT BY QUARTER

2024 2024 2023 2023 2023
EUR M Q2 Q1 Q4 Q3 Q2

SALES 125.9 93.2 112.2 152.9 132.4

Other operating revenue 0.2 0.4 0.3 0.0 0.1

Expenses
Goods and services 27.3 21.5 26.7 33.1 31.3
Salary and other 31.6 28.0 27.5 27.9 28.6
employment benefit
expenses
Depreciation, 7.6 7.5 7.1 6.9 6.8
amortization and
impairment losses
Other operating expenses 53.5 47.1 48.5 49.8 47.8
119.9 104.1 109.8 117.7 114.5

OPERATING INCOME 6.2 -10.4 2.7 35.3 18.0

Financial income 0.5 0.9 1.3 0.6 0.6
Financial expenses -2.8 -3.4 -3.3 -2.3 -3.4
Share of after-tax -2.0 -1.2 1.4 0.6 -1.1
income from joint
ventures and
accounted for using the
equity method

INCOME BEFORE TAXES 1.8 -14.2 2.0 34.2 14.0

Income taxes -0.1 -0.1 -0.3 -6.6 -2.9

INCOME FOR THE PERIOD 1.8 -14.3 1.7 27.6 11.1

Income attributable to:
Parent company 1.8 -14.3 1.7 27.6 11.1
shareholders

Earnings per share 0.10 -0.82 0.10 1.60 0.64
before and after
dilution, EUR

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME BY QUARTER

2024 2024 2023 2023 2023
EUR M Q2 Q1 Q4 Q3 Q2

INCOME FOR THE PERIOD 1.8 -14.3 1.7 27.6 11.1

Items that may be
reclassified to the income
statement
Translation differences 0.3 -0.9 1.0 0.7 -1.3

Items that will not be
reclassified to the income
statement
Changes in the fair value of
financial assets at fair
value through other 0.0 0.0 0.3 1.2 -
comprehensive income

Other comprehensive income 0.3 -0.9 1.3 1.9 -1.3

COMPREHENSIVE INCOME FOR THE 2.1 -15.1 3.0 29.5 9.8
PERIOD

Comprehensive income
attributable to:
Parent company shareholders 2.1 -15.1 3.0 29.5 9.8

KEY METRICS

Jan 1, 2024- Jan 1, 2023- Jan 1, 2023-
Jun 30, 2024 Jun 30, 2023 Dec 31, 2023

Equity per share, EUR 16.95 16.84 18.71
Equity/assets ratio 49.2% 47.8% 51.4%

Investments, EUR M 15.4 7.7 36.9
- as % of sales 7.0% 3.4% 7.5%

Passengers 2,062,271 2,185,843 4,897,494
Cargo units 66,385 64,872 125,269

Average number of 2,305 2,138 2,227
employees, full-time
equivalent

Equity per share = Equity attributable to parent company shareholders / Number of shares.

Equity/assets ratio, % = (Equity including minority interest) / (Total assets - advances received).

When rounding off items to the nearest EUR 1,000,000, rounding-off differences of EUR +/- 0.1 M may occur.

NOTES TO THE HALF-YEAR FINANCIAL REPORT FOR THE PERIOD JANUARY-JUNE 2024

1. Accounting principles

This Half-Year Financial Report has been prepared in accordance with International Financial Reporting Standards (IFRS) reporting and valuation principles and consists of a summary of the financial statements for the period in accordance with IAS 34.

The Half-Year Financial Report has been prepared in accordance with the same accounting principles, estimates and valuations as in the most recent annual accounts, unless otherwise indicated below.

This Half-Year Financial Report has not been subject to an audit.

When rounding off items to the nearest EUR 1,000,000, rounding-off differences of EUR +/- 0.1 M may occur.

2. Estimates and judgements

In preparing the consolidated financial statements in compliance with IFRS accounting standards, the company's management must make judgements and estimates about the future that affect the reported amounts for assets and liabilities, revenue and expenses as well as other information. The judgements and estimates contained in the financial statements are based on the best assessment of management on the date the Financial Report was published.

The geopolitical situation, with very volatile energy prices, affects the income statement and balance sheet. It is difficult to determine how long energy prices will fluctuate like this and what effects this will have on Viking Line's future sales, earnings, financial position and cash flow. The actual outcome may deviate from estimates and judgements made.

The most important area that entails judgements is the valuation of the Group's vessels. Market valuations are carried out on a regular basis by external assessors. The vessels' residual values and estimated periods of use are examined yearly and adjusted if they deviate significantly from earlier values.

Until November 22, 2023, the holding in Rederiaktiebolaget Eckerö was included in financial assets at fair value through other comprehensive income, but the holding has been reclassified since then and is now reported as a company with a participating interest undertaking using the equity method.

In valuing the Group's leases, judgements are made as to how the Group will capitalize on any opportunity to extend the lease period or terminate the lease. Judgements are also made as to what discount rate is to be used in calculating the present value of the Group's lease liability. The size of the Group's lease liabilities and rights of use, as well as the payments for its lease liabilities and depreciation for its right-of-use assets, is affected by those judgements.

3. Risks and liquidity

The Group's cash and cash equivalents at the end of June totalled EUR 58.0 M (EUR 97.7 M). Unutilized credit lines in the Group totalled EUR 22.1 M as of June 30, 2024 (EUR 0.1 M). Net cash flow from operating activities was EUR 23.3 M (EUR 30.7 M). Net cash flow from investing activities was EUR -13.6 M (EUR 4.5 M) and net cash flow from financing activities amounted to EUR -37.0 M (EUR -26.6 M).

In August 2023, Viking Line and Gotlandsbolaget formed a joint venture which is tasked with developing and providing cruises with Birka Gotland between Stockholm-Mariehamn and Stockholm-Mariehamn-Visby. In March 2023, Gotlandsbolaget acquired Birka Stockholm (Birka Gotland) for EUR 38 M. In August 2023, Gotlandsbolaget sold 50% of the vessel to Viking Line for EUR 19 M, which was financed by Viking Line's cash holdings. The vessel has been rechristened Birka Gotland.

The company's ability to meet the requirements set in existing financial agreements depends on its ability to generate a positive cash flow and earnings from its operations, which depends in part on factors beyond the company's control.

Viking Line's operations are exposed to different kinds of risks, which vary in their scope and impact on operations, financial results and the company's ability to meet certain social and environmental objectives. The relevant risks have been classified into four categories: strategic, operational, damage and financial risks. During the year, geopolitical risks increased to some extent.

To partly offset the risk of higher bunker (vessel fuel) prices, as of June 30, 2024, the Group had fixed price agreements entered into for bunker purchases from the start of the year through July 2024.

There is a risk, if the geopolitical situation deteriorates and energy prices rise significantly in the same way as in 2022, that the company may not generate sufficient cash flow or obtain additional financing to meet its obligations in accordance with its financial agreements.

As of January 1, 2024, Viking Line records and recognizes costs for emission allowances in accordance with the EU Emissions Trading System (ETS) for greenhouse gases. The first emission allowances are to be surrendered by September 30, 2025. To reduce its price risk, Viking Line has begun to purchase emission allowances. The company's strategy until further notice is to purchase emission allowances on a regular basis in order to achieve a cost effect corresponding to the average price and use.

Future cash flows related to financial liabilities as of June 30, 2024:

EUR
M
Future cash flows Lease Trade Interest- Total
related to
financial liabilities liabilities payables bearing
(incl. financial
expenses)
liabilities
Jul 1, 2024 - Dec 31, 1.4 33.8 22.9 58.1
2024
Jan 1, 2025 - Jun 30, 1.4 22.4 23.9
2025
Jul 1, 2025 - Jun 30, 1.8 28.9 30.6
2026
Jul 1, 2026 - Jun 30, 0.6 34.5 35.1
2027
Jul 1, 2027 - Jun 30, 0.4 24.4 24.8
2028
Jul 1, 2028 - Jun 30, 0.1 18.3 18.5
2029
Jul 1, 2029 - 0.1 54.7 54.9
Total 5.9 33.8 206.2 245.9

4. Segment information

Consolidated revenue decreased 3.2%, and passenger-related revenue decreased 4.3%.

Jan 1, 2024- Jan 1, 2023- Jan 1, 2023-
EUR M Jun 30, 2024 Jun 30, 2023 Dec 31, 2023
Sales
Vessels 216.1 222.4 483.3
Unallocated 3.1 3.9 8.2
Total, operating segments 219.2 226.3 491.5
Eliminations -0.1 0.0 -0.1
Total sales of the Group 219.1 226.3 491.4

Operating income
Vessels 30.0 48.0 116.1
Unallocated -34.3 -30.9 -61.1
Total operating income of the Group -4.3 17.1 55.0

SALES
Passenger-related revenue 192.3 201.1 442.5
Cargo revenue 25.2 23.6 45.7
Miscellaneous sales revenue 1.6 1.6 3.2
Total 219.1 226.3 491.4

5. Other operating revenue

During the comparative period, Rosella was sold, which had a positive income effect of
EUR 8.6 M.

Jan 1, 2024- Jan 1, 2023-
EUR M Jun 30, 2024 Jun 30, 2023

Rents received on properties 0.1 0.1
Capital gains 0.0 8.6
Insurance claim payments, accidents 0.0 0.2
Miscellaneous other operating revenue 0.5 0.0
Total 0.6 8.9

6. Compensation to employees

On March 5, Viking Cinderella was reflagged from a Swedish to a Finnish flag.

During the period, 193 people employed by one of Viking Line Abp's subsidiaries were assigned to work at the joint venture Gotland Alandia Cruises AB, which provides cruise service with the vessel Birka Gotland. Employees contracted out by Viking Line were mainly catering staff.

During the comparative period, Viking XPRS was reflagged from an Estonian to a Finnish flag. Since its reflagging, the vessel is only staffed with Viking Line's own personnel. When the vessel sailed under an Estonian flag, these services were purchased from a staffing company.

Jan 1, 2024- Jan 1, 2023-
EUR M Jun 30, 2024 Jun 30, 2023

Salaries 63.4 55.8
Expenses of defined-contribution pensions 7.5 6.5
Other payroll overhead 5.6 6.2
76.5 68.4
Government restitution -16.9 -15.3
Total 59.6 53.1

7. Depreciation and amortization

Jan 1, 2024- Jan 1, 2023-
EUR M Jun 30, 2024 Jun 30, 2023

Depreciation and amortization
Intangible assets 0.3 0.2
Building and structures 0.0 0.0
Renovation costs for rented properties 0.2 0.2
Vessels 12.8 11.3
Machinery and equipment 0.3 0.3
Right-of-use assets 1.5 1.4
Total 15.1 13.5

8. Other operating expenses

Jan 1, 2024- Jan 1, 2023-
EUR M Jun 30, 2024 Jun 30, 2023

Sales and marketing expenses    10.6 9.8
Washing and cleaning expenses    10.6 11.2
Repairs and maintenance    8.4 6.3
Public port expenses and vessel charges    18.1 16.8
Fuel expenses 28.9 30.9
Miscellaneous expenses 24.0 22.5
Total 100.5 97.6

9. Financial expenses

Jan 1, 2024- Jan 1, 2023-
EUR Jun 30, 2024 Jun 30, 2023
M

Interest expenses on
financial liabilities
recognized at
amortized cost 5.7 4.3
Interest expenses on lease 0.2 0.2
liabilities
Exchange losses 0.1 0.9
Guarantee commissions and 0.2 0.7
other financial expenses
Total financial expenses 6.2 6.2

10. Income taxes

As of June 30, 2024, the Group recognized net deferred tax liabilities of EUR 45.2 M, EUR 46.1 M of which was deferred tax liabilities and EUR 0.9 M was deferred tax assets.

EUR
M
Deferred Differences between Losses Other Total
tax recognized value of recognized in temporary
liabilities fixed assets and taxation differences
their value for tax
purposes
Jan 1, 2024 45.1 - 0.2 45.2
Translation -0.1 - - -0.1
differences
Recognized - - 0.0 0.0
in
income
statement
Recognized - - - -
directly in
equity
Jun 30, 45.0 - 0.2 45.2
2024

11. Impairment testing

Recognized values for intangible assets and property, plant and equipment are tested regularly in order to identify any external or internal indications of an impairment loss. If such indications are observed for any asset item, the recoverable amount of the asset is recognized. One of the most important areas that entail judgements is valuation of the Group's vessels.

The management has also made the assessment that there is no need for impairment for the Group's other non-current assets.

12. Investments accounted for using the equity method

During the first half of the year, Viking Line Abp's investments in Alandia Försäkring Abp and Alandia Holding Abp generated income of EUR 2.6 M. Under IAS 28.10, the dividend received during the period from Alandia Försäkring Abp of EUR 1.2 M only results in a positive cash flow for the Group.

Viking Line's Abp's shareholding in Rederiaktiebolaget Eckerö has exceeded 20% since November 22, 2023, so Rederiaktiebolaget Eckerö has been recognized as a company with a participating interest undertaking using the equity method since then. An initial positive income effect of EUR 2.5 M arose in the transition and thus affected revenue in 2023. Viking Line's share of Rederiaktiebolaget Eckerö's revenue for the period January-March 2024 totalled EUR -0.8 M and is included in Viking Line's consolidated income. Viking Line has not yet received figures for the period April-June. Under IAS 28.10, the EUR 0.5 M dividend received during the period from Alandia Försäkring Abp only results in a positive cash flow for the Group.

On August 9, 2023, Viking Line and Gotlandsbolaget announced the formation of a joint venture, Gotland Alandia Cruises AB, which is tasked with developing and providing cruises with Birka Gotland. Viking Line has a 50% shareholding in the company, which is thus recognized as a joint venture. Viking Line's investment for the period January 1-June 30 generated a loss of
EUR 5.0 M.

13. Trade and other receivables

Trade receivables are recognized at amortized cost in accordance with IFRS 9. The carrying amount of trade receivables and other receivables is considered equal to fair value given the short-term nature of the items.

14. Pledged assets and contingent liabilities

EUR M Jun 30, 2024 Dec 31, 2023

Contingent liabilities 1 192.0 187.6
Assets pledged for own debt 2 410.4 413.4
Other liabilities not shown in the balance sheet 3 2.6 2.8

1 Concerning loans and credit lines for which vessel, property and chattel mortgages were provided as collateral and other contingent liabilities not included in the balance sheet covered by site leasehold and chattel mortgages.

2 Concerning vessel mortgages, chattel mortgages and site leasehold mortgages.

3 In addition to a capital injection, Alandia Holding Ab has taken a loan to finance the purchase of shares in Alandia Försäkring Abp. To the extent Alandia Holding Ab is in need of cash equivalents to make the payments, Viking Line Abp has undertaken to make a cash capital contribution to Alandia Holding Ab through a shareholder agreement.

15. Events after the balance sheet date

The Board of Directors knows of no significant events after the balance sheet date that could affect the Half-Year Financial Report.

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