Q2 2026 Tallinna Sadam AS Earnings Call

August 10, 2026

Speaker #1: Good morning. Welcome to our Q2 webinarium. My name is Valdo Kalm, and Andrew Sait is our CFO. And as usual, we would like to start with overall comments and events on Q2.

Speaker #1: In Q2, we had an increase of revenue by 5.4%, and that's mainly due to the good start from our offshore ship Botnica. And also, we had a nice growth and start of Crois season; we got 30% more cruise ships than last year, and 40% more passengers.

Speaker #1: Although, at the same time, we had quite a big influence for the from heavy winter, that means that by the end of Q1 it was quite a tough situation with ice.

Speaker #1: And we got some extra cost from our total companies' Tesla, and also from the shipping and the therefore our profitability went down due to that, but it's more one-time issue.

Speaker #1: And also, on Q2 results of the last year, we had positively influenced by one of profit of 1 million euros, sales of land of Muga to Rail Baltica, therefore there was also such a one-time positive issue or topic from last year, and it negatively this year.

Speaker #1: The main trends sorry, main events from Q2 we had quite stable passenger flows, but decrease in cargo. 2.3% we had annual general meeting and we did distributed the dividends as we promised and very important was the adoption of two detail plans by Tallinn City Council that's really important start for our real estate business as we promised we will try to start by the end of this year with the first plot and the first tender let's see we have to also agreed some details with city government but we are really on a on a very end of the process.

Speaker #1: Right, and very important was the adoption of two detailed plans by the Tallinn City Council. That's a really important start for our real estate business, as we promised.

Valdo Kalm: Very important was the adoption of two detailed plans by Tallinn City Council. That's a really important start for our real estate business. As we promised, we will try to start by the end of this year with the first plot and the first tender. Let's see, we have to also agreed some details with city government, but we are really on a very end of the process. Botnica had quite an early job in North Sea. It went well, and then we signed additional trips for the regular summer job with the minister. Also went well. Regular did good job. We signed loan agreement with OP Bank, not using yet the credit line, but agreement is signed.

Speaker #1: We will try to start by the end of this year with the first plot and the first tender, let's see. We'll have to also agree on some details with the city government, but we are really at the very end of the process.

Speaker #1: Botnica had quite an early job in North Sea it went well and then we signed additional trips for the regular summer job with Ministry also went well regular did good job and we signed loan agreement with OPE Bank not using yet the credit line but agreement is signed and already many years we are ranked among the most reputable employers in Estonia and this time we got the highest ranking on a fifth position together with other important companies and famous brands also on retail banks and other retail brands trends in Q2 as I mentioned passenger business a little bit decreased but we had very good start of cruise and there was 40% more passengers therefore there is an increase of revenue of 5% on cargo side we had 2% decrease our main and most important segment RORO and the biggest segment of course had basically similar level as last year and even increase with six month but we had still decrease from from liquid bulk and altogether then there is revenue decrease 2.7% very business shows very stable or even increasing numbers in revenues in number of passenger vehicles and trips and as we mentioned then Botnica offshore ship had doubled the charter days from last year there are more precise numbers on passengers also on cargo as I mentioned important to keep our biggest group RORO stable or even in six month we have had increase let's see how we will continue on a on a second half it depends of course in economy in export but there are some positive trends on export therefore we are we are we would like to see the still growth in RORO and probably in containers shipping volumes on authority segment very stable and Botnica showed good utilization rate in Q2 and therefore you see the growth on six month period compare with the last year future outlook it's quite a similar as we show you last quarter we hope it will be a good season and year for the cruise there are already 30% more vessels and 50% more passengers we see good bookings by the end of the year we continuously working with new RORO and container lines specifically for Paldiski because now we have new quay before we had lack of resources in Paldiski now we have excellent conditions there therefore we negotiating with two companies for Paldiski and Muga and maybe there will be some good news by the end of the year then we signed in Q2 also contract with Lübeck and Hamburg ports to develop our existing customer base and cargo volumes because we have the same container lines entering tower ports but we see there are growth possibilities and it's very concrete with Lübeck but also with Hamburg we have three four very concrete points and cooperation activity to achieve and there is ongoing industrial park campaign for Muga development area what is around 20 hectares we have one quite concrete negotiation in the middle of that we can't comment we're talking about the industry with good flows of vessels or cargo but it's really too early to comment maybe we will have certain news also by the end of the year then I mentioned there is ongoing cooperation for real estate business or tender and it's all about efficiency we working on that on process side and if we follow our personnel numbers we will manage to decrease it by six month also I would like to give the floor now to Andros to comment our financials thank you Waldo so these are the financial results for the second quarter and six months period financial results very impacted like already explained by a fewer cargo volumes less vessel calls in total at the same time we had higher fuel cost for ferries and electricity cost as well and also last year in second quarter we had also some one of one of positive effects which I explain later and from positive side there was there were some offsetting offsetting effects from the working activities and also from higher number of cruise ship calls revenue increased by 5.4% to 31.1 million euros and the growth here is explained by the higher number of charter days of Botnica there were 20 extra days compared to the last year same period and vessel queues also increased because of higher number of cruise ship calls and we also increased the vessel to tariffs which came into effect starting from April so this had also some effect and there were was increase also in sale of electricity and sale of ferry services as well adjusted EBITDA fell by almost 11% to 14.2 million euros decline year is forced by higher fuel costs of ferries because of the higher price level also electricity costs were higher but these costs were covered by higher revenues so EBITDA level there wasn't effect from electricity costs we also made more repair and maintenance work partially it was connected with ferry segment ferry operations in the first quarter where we had tough ice conditions this impacted also Botnica technical condition so we had to make there also some extraordinary repairs and partially the higher repair costs were caused because of the fact that more repair works just concentrated on the second quarter so adjust EBITDA margin fell by 8.1% to 46.7% operating profit also declined by 20% to 7.9 million euros and the client here was a bit higher than on EBITDA level because we had higher amortization costs because we commissioned the new quay in Paldiski but also also we had some one of write-offs in the second quarter which were made in connection with the repair works and of the ferries income tax was at the same level as year before as we paid out dividends 19.2 million euros like last year so there wasn't any amendment in tax.

Speaker #1: Botnica had quite an early job in the North Sea; it went well, and then we signed additional trips for the regular summer job with the Ministry.

Speaker #1: Also, it went well. Regular did a good job. And we signed a loan agreement with OP Bank, not using the credit line yet, but the agreement is signed.

Speaker #1: And already for many years we are ranked among the most reputable employers in Estonia, and this time we've got the highest ranking at fifth position, together with other important companies and famous brands, also in retail.

Valdo Kalm: Already many years, we are ranked among the most reputable employers in Estonia, and this time we got the highest ranking on a fifth position together with other important companies and famous brands, also on retail banks and other retail brands. Trends in Q2. As I mentioned, passenger business little bit decreased, but we had very good start of cruise, and there was 40% more passengers, therefore there is an increase of revenue of 5%. On cargo side, we had 2% decrease. Our main and most important segment, ro-ro, and the biggest segment of course, had basically similar level as last year and even increase with 6 months. We had still decrease from liquid bulk, and altogether, there is revenue decrease 2.7%. Ferry business shows very stable or even increasing numbers in revenues in number of passenger vehicles and trips.

Speaker #1: Banks and other retail brands. Trends in Q2: as I mentioned, passenger business decreased a little bit, but we had a very good start of the cruise.

Speaker #1: And there was a 40% more passengers, therefore there is an increase of revenue, 5%. On cargo side, we had 2% decrease. Our main and most important segment, RORO, and the biggest segment, of course, had basically similar level as last year, and even increase with a 6-month, but we had still decrease from liquid bulk.

Speaker #1: And altogether, then there is a revenue decrease of 2.7%. Every business shows very stable or even increasing numbers in revenues, number of passengers, vehicles, and trips.

Speaker #1: And as we mentioned, Botnica offshore ship had doubled the charter days from last year. There are more precise numbers on passengers, also on cargo, as I mentioned, important to keep our biggest group, RORO, stable or even in 6 months we have had increase.

Valdo Kalm: As we mentioned then, Botnica offshore ship had doubled the charter days from last year. There are more precise numbers on passengers, also on cargo, as I mentioned, important to keep our biggest group, ro-ro, stable or even in 6 months we have had increase. Let's see how we will continue on a H2. It depends of course on economy, in export, but there are some positive trends on export, therefore, we would like to see there's still growth in ro-ro and probably in containers. Shipping volumes on our ferry segment very stable. Botnica showed good utilization rate in Q2, and therefore you see the growth on 6-month period compared with the last year. Future outlook. It's quite similar as we show you last quarter. We hope it will be a good season and year for the cruise.

Speaker #1: Let's see how we will continue. On the second half, it depends, of course, on the economy and exports, but there are some positive trends in exports. Therefore, we would like to see growth in Ro-Ro and probably in containers.

Speaker #1: Shipping volumes on the authority segment were very stable, and Botnica showed a good utilization rate in Q2. Therefore, you see the growth over the 6-month period compared with last year.

Speaker #1: Future outlook: it's quite similar, as we showed you last quarter. We hope it will be a good season and year for the cruise.

Speaker #1: There are already 30% more vessels and 50% more passengers. We see good bookings by the end of the year. We are continuously working with new Ro-Ro and container lines, specifically for Paldiski, because now we have a new quay. Before, we had a lack of resources in Paldiski; now we have excellent conditions.

Valdo Kalm: There are already 30% more vessels and 50% more passengers. We see good bookings by the end of the year. We continuously working with new ro-ro and container lines, specifically for Paldiski because now we have new quay. Before we had a lack of resources in Paldiski. Now we have excellent conditions there. Therefore, we're negotiating with two companies for Paldiski and Muuga, and maybe there will be some good news by the end of the year. We signed in Q2 also contracts with Lübeck and Hamburg ports to develop our existing customer base and cargo volumes because we have the same container lines entering our ports, but we see there are growth possibilities, and it's very concrete with Lübeck but also with Hamburg. We have three, four very concrete points and cooperation activities to achieve.

Speaker #1: Therefore, we are negotiating with two companies for Piledeski and Muga. And maybe there will be some good news by the end of the year. Then we signed in Q2, also, a contract with Lübeck and Hamburg ports to develop our existing customer base and cargo volumes.

Speaker #1: Because we have the same container lines entering our ports, but we see there are growth possibilities, and it's very concrete with Lübeck, but also with Hamburg.

Speaker #1: We have three to four very concrete points and cooperation activities to achieve. And there is an ongoing industrial park campaign for the Muga development area, which is around 20 hectares. We have one quite concrete negotiation in the middle of that.

Valdo Kalm: There is ongoing industrial park campaign for Muuga development area, what is around 20 hectares. We have one quite concrete negotiation in the middle of that we can't comment. We're talking about industry with good flows of vessels or cargo, but it's really too early to comment. Maybe we'll have certain news also by the end of the year. As mentioned, there is ongoing preparation for real estate business or tender, and it's all about efficiency. We working on that, on process side, and if we follow our personnel numbers, we will manage to decrease it by six months also. I would like to give the floor now to Andrus to comment our financials.

Speaker #1: We can't comment; we're talking about the industry, with good flows of vessels or cargo, but it's really too early to comment. Maybe we will have certain news also by the end of the year.

Speaker #1: Then I mentioned there is ongoing cooperation for real estate, business, or tenders, and it's all about efficiency. We're working on that on the process side, and if we follow our personnel numbers, we will manage to decrease it by six months also.

Speaker #1: I would like to give the floor now to Andros, to comment on our financials.

Speaker #2: Thank you, Valdo. So these are the financial results for the second quarter and 6-month period. Financial results were impacted, as currently explained, by lower cargo volumes, fewer vessel calls in total, and at the same time we had higher fuel costs for ferries and increased electricity costs as well.

Andrus Ait: Thank you, Valdo. These are the financial results for the Q2 and H1 period. Financial results were impacted, like already explained, by fewer cargo volumes, less vessel calls in total. At the same time, we had higher fuel cost for ferries and electricity cost as well. Also last year, in Q2, we had also some one-off positive effects, which I explain later. From positive side, there were some offsetting effects from the Botnica activities and also from higher number of cruise ship calls. Revenue increased by 5.4% to EUR 31.1 million, and the growth here is explained by the higher number of charter days of Botnica.

Speaker #2: And also, last year in the second quarter, we had some one-off positive effects, which I will explain later. On the positive side, there were some offsetting effects from technical activities and also from a higher number of cruise ship calls.

Speaker #2: Revenue increased by 5.4% to €31.1 million. The growth here is explained by the number of chartered Botnica days—there were 20 extra days compared to the same period last year. Vessel queues also increased because of a higher number of cruise ship calls. We also increased the vessel tariffs, which came into effect starting from April, so this had some effect as well. There was also an increase in the sale of electricity and the sale of ferry services.

Andrus Ait: There were 20 extra days compared to the last year same period. Vessel calls also increased because of fair number of cruise ship calls, and we also increased the vessel dues tariffs which came into effect starting from April, so this had also some effect. There was increase also in sale of electricity and sale of ferry services as well. Adjusted EBITA fell by almost 11%, down to EUR 14.2 million. Decline here is caused by higher fuel costs for ferries because of the higher price level. Also, electricity costs were higher, but these costs were covered by higher revenues. EBITA level, there was an effect from electricity costs. We also made more repair and maintenance work. Partially, it was connected with the ferry segment, the ferry operations in the Q1 where we had tough ice conditions.

Speaker #2: Adjusted EBITDA fell by almost 11% compared to €14.2 million. The decline was caused by higher fuel costs for ferries due to the higher price level. Electricity costs were also higher, but these costs were covered by higher revenues.

Speaker #2: So, at EBITDA level, there wasn't an effect from electricity costs. We also made more repair and maintenance work. Partially, it was connected with the ferry segment to ferry operations in the first quarter, where we had tough ice conditions. This impacted also Botnica's technical conditions, so we had to make, there also, some extraordinary repairs. And partially, the higher repair costs were caused because of the fact that more repair works just concentrated on the second quarter. So, adjusted EBITDA margin fell by 8.1% to 46.7%. Operating profit also declined by 20% to €7.9 million, and the decline here was a bit higher than on the EBITDA level because we had higher amortization costs, as we commissioned the new quay, and involved this quay. But also, we had some one-off write-offs in the second quarter, which were made in connection with the repair works and of the ferries.

Andrus Ait: This impacted also Botnica technical condition, so we had to make there also some extraordinary repairs. Partially, the higher repair costs were caused because of the fact that more repair works just concentrated on the Q2. Adjusted EBITA margin fell by 8.1% to 46.7%. Operating profit also declined by 20% to EUR 7.9 million. The decline here was also a bit higher than on EBITA level because we had higher amortization costs because we commissioned the new quay, Paldiski, but also we had some one-off write-offs in the Q2, which were made in connection with repair works of the ferries. Income tax was at same level as year before, as we paid out dividends, EUR 19.2 million like last year. There wasn't any amendment in tax regulation. There was then change.

Speaker #2: Income tax was at the same level as the year before, as we paid all dividends—€19.2 million—like last year. So there wasn't any amendment in tax regulation, so there wasn't any change. Profit for the period decreased by 60% to the level of €1.4 million, and the decline here is a bit lower than the operating profit growth in euros. That's because our interest payments were a bit lower and financial costs, as the outstanding amount of debt, decreased.

Speaker #1: Regulation so there wasn't any change profit for the period decreased by 60% to the level for 1.4 million euros and decline here is a bit lower than operating profit growth in euros that's because our interest payments were a bit lower and financial costs as the outstanding amount of debt decreased and we invested 2.3 million euros in the second quarter the main investment was the replacement or renewal of the main engine of one of our ferries.

Andrus Ait: Profit for the period decreased by 60% to the level for EUR 1.4 million. Decline here is a bit lower than operating profit in euros. That's because our interest payments were a bit lower than financial costs as the outstanding amount of debt decreased. We invested EUR 2.3 million in Q2. The main investment was the replacement or renewal of the main engine of one of our ferries. This was regular work after a certain number of operating hours, they have to exchange the engines, and this was the main investment. We also reinforced one quay in Muuga Harbor to install the onshore power supply for the container ships. 2024, we had the ongoing investment, the construction of Paldiski South Harbour.

Speaker #2: And we invested 2.3 million euros in the second quarter the main investment was the replacement or renewal of the main engine of one of our ferries this was regular work after a certain number of operating after a certain number of operating hours we have to exchange the engines and this was the main investment and we also reinforced the one key move a harbor to install the onshore power supply for the container ships and last year we had ongoing investment to construct the Baltic South Harbor new key this year we didn't have such kind of higher bigger investment so therefore this explains the job in investments.

Speaker #1: This was regular work after a certain hour of operating after a certain number of operating hours we have to exchange the engines and this was the main investment and we also reinforced the one key move a harbor to install the onshore power supply for the container ships and last year we had ongoing investment to construct the Paldiski South Harbor new quay this year we didn't have such kind of prior bigger investment so therefore this explains the job in investments six months period the numbers are quite similar but there were some extra one of effects as we got insurance indemnity from Botnica for Botnica repair works which we carried out in 2024 so this this pursuits or payments were in the first quarter 2025 this year we didn't have this impact last year we also sold land in Nova Harbor this also impacted the adjusted EBITDA this impact was in the second quarter and also in six month period and also last year we received some payments for for for for the debt store which we have considered uncollectible so therefore there was lower cost level in 2025 and in first quarter in addition the fuel costs of ferries were impacted by severe ice conditions so their consumption from that was also higher and profit for the six month period was 6 million euros decline here was 41.7% and we invested 3.5 million euros in the first quarter we proceeded to to design the new A terminal and made also some IT and investments when I look at the results by segment wise we see that in the second quarter revenue increased in three of four segments the decline was in cargo harbors in other segments there were growths and EBITDA increased in the second order was stable in passenger harbors and declined in cargo harbors and ferry segment in passenger harbors revenue increased mainly due to the cruise ship calls and also due to the higher tariffs of vessel dues which came into effect starting from April actually all the revenue streams in passenger harbors increased except the sale of other services as the revenue from advertising activities decreased the EBITDA in passenger harbors remained stable we had some elevated level of repair works there as we we repaired the cruise ship keys and this was reasonable to do before the summer where we have the peak of of cruise ship calls so therefore the repair works more concentrated to the the second quarter in cargo harbors revenue declined and this is mainly attributable to the fact that the towing vessel super fast didn't operate it anymore in Paldiski Kapperskare route after the first decade of April so due to that the vessel dues decreased we had also less cargo and cargo charges also decreased and on EBITDA level there was a higher drop to explain that last year we sold the land in Muga Harbor and from that we had positive impact in amount of 900,000 euros and in addition to that we were able to recover some receivable estimated on collectible this impact was for about 400,000 euros and this was in 2025 so this year we didn't have any any positive one offs in cargo harbors in the ferry segment revenue increased because of indexation based on the fuel price in the first quarter but costs increase in costs was higher because of that the EBITDA decreased it's important to explain the indexation in ferry revenues so some of the indexation is based on the fuel price index but in the first quarter this year the price started to increase in March so the average price for the first quarter was not so high but so it means that the revenues in second quarter wasn't indexed based on the first quarter average price there was indexed on that but but the cost level was already higher throughout the entire quarter so the the indexation didn't cover the the higher costs fully so in coming coming quarters the indexation effect on revenues should be a bit higher than than in the second quarter and in the second order revenues increased because of longer charter period and EBITDA also increased but a bit less because there is an.

Andrus Ait: In Q1 2025, we didn't have such kind of bigger investment, therefore, this explains the drop in investments. H1 period, the numbers are quite similar, but there were some extra. One of effects as we got insurance indemnity from Botnica for repair works, which we carried out in 2024. So 2025, these receipts or payments were in Q1 2025. 2025 we didn't have this impact. 2024, we also sold the land in Muuga Harbor. This also impacted the adjusted EBIT. This impact was in Q2 and also in the H1 period. Also, 2024 we received some payments for the debt still which we have considered uncollectible, therefore, there was a lower cost level in 2025.

Speaker #2: Six months period the numbers are quite similar but there were some extra one-off effects as we got insurance indemnity from Botnica for Botnica repair works which we carried out in 2024 so this payments were in the first quarter 2025 this year we didn't have so this impact last year we also sold land in Nova Harbor this also impacted the adjusted EBITDA this impact was in the second quarter but also in six month period and also last year we received some payments for the debt store which we have considered uncollectible so therefore there was lower cost level in 2025 and in first quarter in addition the fuel costs of ferries were impacted by severe ice conditions so the consumption from that was also higher and profit for the six month period was 6 million euros decline here was 41.7% and we invested 3.5 million euros in the first quarter we proceeded to design the new A terminal and made also some IT investments when I look at the results by segment wise we see that in the second quarter revenue increased in three of four segments but the decline was in cargo harbors in other segments there were growths and EBITDA increased in the second order was stable in passenger harbors and declined in cargo harbors and ferry segment in passenger harbors revenue increased mainly due to the cruise ship calls and also due to the higher tariffs of vessel dues which came into effect starting from April actually all the revenue streams in passenger harbors increased except the sale of other services as the revenue from advertising activities decreased the EBITDA in passenger harbors remained stable we had some elevated level of repair works there as we repaired the cruise ship keys and this was reasonable to do before the summer where we have the peak of cruise ship calls so therefore the repair works more concentrated to the second quarter in cargo harbors revenue declined and this is mainly attributable to the fact that the Tallink vessel Superfast didn't operate it anymore on Baltic Kapperskär route after the first decade of April so due to that the vessel dues decreased we had also less cargo and cargo charges also decreased and on EBITDA level there was a higher drop to explain that last year we sold the land in Nova Harbor and from that we had positive impact in amount of 900,000 euros and in addition to that we were able to recover some receivable estimated on collectibles this impact was for about 400,000 euros and this was in 2025 so this year we didn't have any positive one-offs in cargo harbors in ferry segment revenue increased because of indexation based on the fuel price in the first quarter but costs increase in costs was higher because of that the EBITDA decreased it's important to explain the indexation in ferry revenues so some of the indexation is based on the fuel price index but in the first quarter this year the price started to increase in March so the average price for the first quarter was not so high but so it means that the revenues in second quarter wasn't indexed based on the first quarter average price there was indexed on that but the cost level was already higher throughout the entire quarter so the indexation didn't cover the higher costs fully so in coming quarters the indexation effect on revenues should be a bit higher than in the second quarter and in second order revenues increased because of longer charter period and EBITDA also increased but a bit less because personnel expenses increased as the ship is chartered out then we have elevated level of personnel expenses and also we made some repair works after the tough ice breaking season in the first quarter this year in six month period the revenue increased in three segments like in the second quarter and the additional impacts were in second order on EBITDA level where the EBITDA decreased in six months period because of the insurance indemnity last year which we didn't have this year this impact was 900,000 euros and in ferry segment the EBITDA was impacted by severe ice conditions which increased the consumption of the fuel and also we had less cargo due to the ice conditions as well so this impact was also in cargo harbors so in cash flow side we see that cash from operating activities decreased by 8 million euros because of the sale of services decreased and the payments used by us increased the sale of services increased partially due to the fact that in the first quarter 2025 we received payment for the charter work of Sputnik which was carried out in the fourth quarter 2024 this year we didn't have this kind of this kind of receipt so therefore there was some decline from one of impact as well and payment to the suppliers increased mainly because of fuel.

Andrus Ait: In Q1, in addition, the fuel costs of ferries were impacted by severe ice conditions, the consumption from that was also higher. Profit for the H1 period was EUR 6 million. Decline here was 41.7%, we invested EUR 3.5 million. In Q1, we proceeded to design the new A-terminal and made also some IT investments. We look at the results by segment wise, we see that in Q2, revenue increased in three of four segments. The decline was in cargo harbors. In other segments, there were growth. EBIT increased in segment other, was stable in passenger harbors and declined in cargo harbors and ferry segment. In passenger harbors, revenue increased mainly due to the cruise ship calls, also due to the higher tariffs of vessel dues, which came into effect starting from April.

Andrus Ait: Actually, all the revenue streams in passenger harbors increased except the sale of other services as the revenue from advertising activities decreased. The EBIT in passenger harbors remained stable. We had some elevated level of repair works there as we repaired the cruise ship quays, and this was reasonable to do before the summer, where we have the peak of cruise ship calls. Therefore, the repair work is more concentrated to Q2. In cargo harbors, revenue declined, and this is mainly attributable to the fact that the towing vessel, Superfast, didn't operate anymore in Paldiski Kapellskär route after the first decade of April. Due to that, the vessel dues decreased. We had also less cargo, and cargo charges also decreased. On EBIT level, there was a higher drop.

Andrus Ait: To explain that, last year we sold the land in Muuga Harbor, and from that we had EUR +900,000. In addition to that, we were able to recover some receivable estimated uncollectible. This impact was for about EUR 400,000, and this was in 2025. This year we didn't have any positive one-offs in cargo harbors. In ferry segment, revenue increased because of indexation based on the fuel price in Q1. Increase in costs was higher. Because of that, the EBIT decreased. It's important to explain the indexation in ferry revenues. Some of the indexation is based on the fuel price index. In Q1 this year, the price started to increase in March, so the average price for Q1 was not so high.

Andrus Ait: It means that the revenues in Q2 wasn't indexed based on Q1 average price. It was indexed on that, but the cost was already higher throughout the entire quarter, so the indexation didn't cover the higher costs fully. In coming quarters, the indexation effect on revenues should be a bit higher than in Q2. In segment other, revenues increased because of longer charter period and EBIT also increased but a bit less because personnel expenses increased as the ship is chartered out, then we have an elevated level of personnel expenses. Also we made some repair works after the tough ice-breaking season in Q1 this year. The H1 period, the revenue increased in three segments, like in Q2, and the additional impacts were in segment other on EBIT level.

Speaker #1: Expenses increased as the ship is chartered out then we have a elevated level of of personnel expenses and also we made some repair works after.

Speaker #1: The tough ice breaking season in the first quarter this year in six month period the revenue increased in three segments like in the second quarter and the additional impacts were in second order on EBITDA level where the EBITDA decreased in six months period because of the insurance indemnity last year which we didn't have this year this impact was 900,000 euros and in ferry segment the EBITDA was impacted by by severe ice conditions which increased the consumption of of the fuel and also we had less cargo due to the ice conditions as well so this impact was also in cargo harbors so in cash flow side we see.

Andrus Ait: The EBIT decreased in the H1 period because of the insurance indemnity last year, which we didn't have this year. This impact was EUR 100,000. In the first segment, the EBIT was impacted by severe ice conditions, which increased the consumption of the fuel. Also we had less cargo due to the ice conditions as well, so this impact was also in cargo harbors. On the cash flow side, we see that the cash from operating activities decreased by EUR 8 million because of the sale of services decreased, and the payments to suppliers increased. Sale of services increased partially due to the fact that in Q1 2025, we received payment for the charter of Poeknik, which was carried out during Q4 2024.

Speaker #1: The cash from. Operating activities decreased. By 8 million euros because of the sale of services decreased and the payments these. Euros increased the sale of services increased partially due to the fact that in the first quarter 2025 we received payment for the charter work of in the fourth quarter 2024 this year we didn't have this kind of this kind of receipt so therefore there was some decline from from one of impact as well and payment to the suppliers increased mainly because of because of fuel costs cash used in investing activities was minus 400,000 euros this includes the investments but we also received grant money from EU fund which supports our investments where we where we construct the onshore power supply for our bush keys and the number of 2025 was.

Andrus Ait: This year, we didn't have this kind of receipt, therefore, there was some decline from one-off impact as well. Payment to the suppliers increased mainly because of fuel costs. Cash used in investing activities was EUR -400,000. This includes the investments, but we also received grant money from EU fund, which supports our investments where we construct the onshore power supply for our quays. The number of 2025 was EUR 20 million. To explain that, we had bank deposits ended during H1, and therefore we had a positive effect, and we had also sale of land in Muuga Harbor. The free cash flow was EUR 17.7 million, and cash used in financing activities was quite similar as the year before. This includes the dividend payout and interest payments were lower than last year a bit.

Speaker #2: Cash used in investing activities was minus €400,000. This includes the investments, but we also received grant money from an EU fund, which supports our investments where we construct the onshore power supply for our cruise quays. The number for 2025 was plus €20 million. To explain that: we had bank deposits ending on June 1 for six months, and therefore we had a positive effect, and we also had the sale of land in the new harbor. The free cash flow was €17.7 million. Cash used in financing activities was quite similar to the year before; this includes the dividend payout, and interest payments were a bit lower than last year. The net cash flow was minus €4.4 million, and net debt was quite similar to the end of 2025 for the six months.

Speaker #1: 20 plus 20 million euros to explain that we had bank deposits ended ended. During the first six months and therefore we had positive effect and we had also sale of land in Muga Harbor the frequent cash flow was 17.7 million euros and cash used in finance activities was quite similar as year before this includes the dividend payout and and interest payments were were lower than than last year a bit and net cash flow was minus 4.4 million euros and net debt was quite similar as in the end of 20 six months 2025 145 million euros so the cash and bank accounts decreased by some 20 million euros and also outstanding loan decreased in the same month and on financial position cash and bank accounts decreased compared to the year year.

Andrus Ait: Net cash flow was EUR -4.4 million, and net debt was quite similar as the end of H1 2025, EUR 145 million. The cash and bank accounts decreased by some EUR 20 million, and also outstanding loan decreased in the same years. On financial position, cash and bank accounts decreased compared to the year-end period last year, and this reflects the negative cash flow, EUR -4 million. Non-current assets decreased because of the reflected amortization and depreciation increased investments was higher than investments. Other current assets increased because we got funding from EU funds, and equity was impacted by dividend payout and profit for the period, and debt was quite similar as at the end of 2025. In the H1 of the year, the loan repayments are quite low, and the higher loan repayments will be made during the Q2.

Speaker #2: For 145 million euros so the cash and bank accounts decreased by some 20 million euros and also outstanding loan decreased in savings and on financial position cash and bank accounts decreased compared to the year in period last year and this reflects the negative cash flow minus 4 million euros non-current assets decreased because of the fact that amortization and deprecation increased investments was higher than investments other current assets increased as we cut the funding from EU funds and the equity was impacted by dividend payout and profit for the period and debt was quite similar as at the end of 2025 in the first half of the year that loan repayments are quite low and the higher loan repayments will be made in the second quarter so with that let's conclude our presentation like always some slides about revenue and EBITDA generation and we will make a short break and you can send us questions and we will back in a couple of minutes to answer the questions thank you so we are back thank you for your questions I take the first question about the investments and is the investment level 2.3 million.

Speaker #1: Period last year and this reflects the. Of the cash flow minus 4 million euros non-current. Decreased because of the amortization and deprecation. Increased investments was higher than than investments other current assets increased as we got funding from EU funds and and equity was impacted by by dividend payout and profit for the period and debt was quite similar as at the end of 2025 in the first half of the year that loan repayments are quite low and the higher loan repayments made in the second quarter so with that let's conclude our presentation like always some slides about revenue and EBITDA generation and we will make a short break and you can can send us questions and we will back in a couple of minutes to to answer the questions thank you.

Andrus Ait: With that, let's conclude our presentation. Like always, there are some slides about revenue and EBITDA generation. We will make a short break, and you can send us questions, and we will be back in a couple of minutes to answer the questions. Thank you. We are back. Thank you for your questions. I take the first question about the investments, and at least the investment level of EUR 2.3 billion, a good indicator for maintenance investments, which are yearly from about EUR 9 to EUR 10 million. Yes, based on the historical data, the average level of maintenance investments is about EUR 10 million. But this year, we also expect some development investments when we start to build the onshore power supply for the cruise ships quays in Old City Harbor.

Speaker #1: So we are back thank you for your questions I take the first question about the investments and and. The investment level 2.3 million euros.

Speaker #1: Good indicator for maintenance investments that which are really for about end to end 9 to 10 million. Euros yes based on historical data the the average level of of maintenance investments is about 10 million euros but this year we also expect some some development investments where we when we start to build the onshore power supply for the cruciate key keys in old city harbor but there has been some delays because of tenders but we see that the annual investment level for the group should be for about 20 or a bit less 20 million so the next question how much of the operating expenses increase of 19% in Q2 year on year was one of related costs it's it's a tricky to to estimate because it's hard to say that whether the the full costs are one off or not but I would say that that some 5% of that was relate to one of the effects.

Speaker #2: Euros for maintenance investments that's which are yearly for about 10 to 10 9 to 10 million euros yes based on the historical data the average level of maintenance investments is about 10 million euros but this year we also expect some some development investments where when we start to build the onshore power supply for the cruciate key keys in old city harbor but there has been some delays because of tenders but we see that the annual investment level for the group should be for about 20 or a bit less 20 million so the next question how much of the operating expenses increase of 19% in Q2 year on year was one of related costs it's it's a tricky to to estimate because it's hard to say that whether the the focus are one off or not but I would say that that some 5% of that was related to one of effects it's like rush estimate which is related to the to the repair works and and other other one of costs so some 5% of that was related to one of could we see a new major tenant in Paldiski late 26 yeah there are two lines that you have the new operator or player on this key one is of course onshore and offshore wind farms operators or it's a new regular shipping operator we pushing towards both lines and it's possible that we have some decision or or contracts by the end of the year but it's more likely that it happens from next year is the risk that rents from new key in Paldiski do not offer required yield for investment capital in the future we don't see yet the risk because if we we planned or we made a business plan and investment decision for this key then it was quite logical that we will start with a smaller project as we had this year and there are bigger revenues planned 2028 therefore not the big risk as we already mentioned there are a lot of regular needs for for bigger capacity also that was lack of resources in Paldiski therefore I don't see big risk yet how much you receive revenues by sale of electricity in annual level so how much it contributed to the next sales growth in Q2 year on year sale of electricity there was increase by 200,000 euros in revenues so the the impact was on cost side similar but as the consumption in first quarter was higher than six month period the the sale of electricity increased by almost 700,000 euros but but this this revenue.

Andrus Ait: There has been some delays because of tenders, but we see that the annual investment level for the group should be for about EUR 20 million or a bit less, EUR 20 million. The next question, how much of the operating expenses increase of 19% in Q2 year-on-year was one-off related costs? It's tricky to estimate because it's hard to say whether the fuel costs are one-off or not. But I would say that some 5% of that was related to one-off effects. It's a rough estimate, which is related to the repair works and other one-off costs. Some 5% of that was related to one-offs. Could we see a new major tenant in Paldiski Quay 26? There are two lines that you have the new operator or player on this quay. One is, of course, onshore and offshore wind farms

Speaker #1: It's like rush estimate which is related to the to the repair works and and other other one of costs so some 5% of that was related to one of could we see a new major tenant in Paldiski late 26 yeah there are two lines that you have the new operator or player on this key one is of course onshore and offshore wind pumps operators or it's a new regular shipping operator we pushing thoughts both lines and it's possible that we have some decision or.

Speaker #1: Or contracts by the end of the year but it's more likely that it happens from next year is the risk that rents from new key in Paldiski do not offer required yield for investment capital in the future we don't see yet the risk because if we we planned or we made a business plan and investment decision for this key then it was quite logical that we will start with a smaller project as we had this year and there are bigger revenues planned for 2028 therefore not the big risk as we already mentioned there are a lot of regular needs for for bigger capacity also that was lack of resources in Paldiski therefore I don't see big risk yet how much you will receive revenues by sale of electricity in annual level so how much it contributed to the next sales growth in Q2 year on year sale of electricity there was increase by 200,000 euros in revenues so the the impact was on cost side similar but as to consumption in first quarter was higher than six month period the the sale of electricity increased by almost 700,000 euros but but this this revenue stream depend on the electricity price which is very hard to estimate or forecast and part of the growth was also attributable to the higher tariff rates for network so this is something which don't change so I I can't say the number by the end of the year but if the the let's say the factors or indicators are similar as in the first half of the year then the growth in the second half of the year should be a bit lower because the consumption usually is the highest in the first quarter so in the second the fourth quarter the consumption is a bit lower so the growth in total would be on level of of 1 million euros but but it's only in case when the the prices remain stable and also the consumption all right thank you for for your questions thank you for your attention and see you next quarter see you in November thank you thank you.

Valdo Kalm: operators or it's a new regular shipping operator. We are pushing towards both lines, and it's possible that we have some decision or contracts by the end of the year, but it's more likely that it happens from next year. Is there a risk that rents from new quay in Paldiski do not offer required yield for investment capital in the future? We don't see yet the risk, because if we planned or we made a business plan and investment decision for this quay, then it was quite logical that we will start with a smaller project as we had this year. And there are bigger revenues planned for 2028. Therefore, not the big risk, as we already mentioned. There are a lot of regular needs for bigger capacity also. That was lack of resources in Paldiski. I don't see big risk yet.

Andrus Ait: How much you receive revenues by sale of electricity in annual level, how much it contributed to the net sales growth in Q2 year-on-year? Sale of electricity, there was increase, EUR 200,000 in revenues, the impact was on cost side similar. As the consumption in Q1 was higher than on H1 period, the sale of electricity increased by almost EUR 700,000. This revenue stream depends on the electricity price, which is very hard to estimate or forecast. Part of the growth was also attributable to the higher tariff rates for network. This is something which does not change.

Speaker #2: Stream depends on the electricity price, which is very hard to estimate or forecast, and part of the growth was also attributable to higher tariff rates for the network. So this is something which doesn't change. So, I can't say the number by the end of the year, but if the, let's say, the factors or indicators are similar as in the first half of the year, then the growth in the second half of the year should be a bit lower, because the consumption usually is the highest in the first quarter. So, in the second to fourth quarters, the consumption is a bit lower, so the growth in total would be on the level of €1 million. But it's only in case when the prices remain stable and also the consumption. All right, thank you for your questions. Thank you for your attention, and see you next quarter.

Andrus Ait: I can't say the number by the end of the year. If, let's say, the factors or indicators are similar as in H1, the growth in H2 should be a bit lower, because the consumption usually is the highest in Q1. In Q4, the consumption is a bit lower. The growth in total would be on level of EUR 1 million. It's only in case when the prices remain stable and also the consumption.

Valdo Kalm: All right. Thank you for your questions. Thank you for your attention, and see you next quarter.

Andrus Ait: See you in November.

Valdo Kalm: Thank you.

Andrus Ait: Thank you.

Q2 2026 Tallinna Sadam AS Earnings Call

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