The company has implemented a comprehensive restructuring program which increased commercial focus and operational efficiency as central, and the planned effects of the program are now showing.
Third quarter 2015 is the strongest quarterly results the company has announced. The improvement of NOK 154 million in normalized EBITDA is driven by increased volume and higher prices for Norwegian coast, Explorer products and the land-based activities on Svalbard.
Having delivered a very strong second quarter, we follow up with a historical third quarter. Macroeconomic conditions as weaker Norwegian krone and lower oil prices are positive for Hurtigruten, but it is a significant improvement in underlying operations that drives the strong performance. This makes Hurtigruten well positioned for further growth, says CEO Daniel Skjeldam.
Second and third quarters are important quarters for Hurtigruten and this year’s summer sailings, with active adventures along the Norwegian coast, has sold well at good prices. Capacity utilization in the third quarter ended at 91 percent, up from 85 percent in the same quarter last year.
Utilizing the available capacity is essential, and this shows the revenue potential we have. In the second quarter, with still a very good result, the utilization was 72 per cent, says Skjeldam.
The improvements are a result of a strategic positioning of the company and a comprehensive product development. Hurtigruten has through its strong position in Polar Regions created an increased demand for active adventure voyages. The company recently launched investments in a new expedition ship and total refurbishment of a large part of the fleet in 2016.
Sales of shorter trips, with a high level of activity, are increasing - especially in the Nordic market. Never before have so many chosen a Hurtigruten voyage along the Norwegian coast with rib-excursions and sea eagle safari, rather than a long weekend in a big city.
On board sales increase
Onboard sales increased by 13.8 percent on the Norwegian coast product in the quarter. This is important not only because of revenues but also because it shows the level of activity on board and during the voyage. Hurtigruten’s focus on Norway’s Coastal Kitchen, with locally produced quality food, is contributing to onboard sales and has been a success.
All the group’s product areas show improvements in the quarter. The explorer vessel MS Fram increased the capacity utilization from 81 to 86 percent. The positive development in both volume and price is driven by increased demand for travel to Greenland and Svalbard. A strong performance from MS Fram, operationally and financially, enables Hurtigruten next year to triple capacity in Antarctica with the launch of MS Midnatsol as a second ship.
- We are already the largest operator in the Arctic, and will with the additional capacity on MS Midnatsol become the largest operator in Antarctica. This is an important step for further growth and positioning of the company globally, says Daniel Skjeldam.
Hurtigruten has had constant improvement since the third quarter of 2013, and has delivered two consecutive historically strong quarters in 2015. Strong cost control combined with more guests drives the results.
We have announced very good results so far this year and expect a strong improvement for 2015 compared with last year. The outlook is also positive for 2016, with a presale for 2016 ahead of presales for 2015, compared at the same time last year, says Skjeldam.