ICG profits slip due to fuel costs and drop in passengers

IRISH CONTINENTAL Group’s (ICG) operating profit in the first nine months of this year declined by more than 15 per cent to €37.5 million due to a 60 per cent rise in fuel costs and a sharp fall-off in passenger, car and cargo volumes.

ICG’s revenue for the nine months to the end of September fell to €265.5 million from €269.2 million.

The company said passenger numbers had slipped by 5.5 per cent to 1.3 million. Its car traffic is 6.4 per cent down year-on-year while its RoRo freight volumes are down 6.6 per cent. Container freight volumes have risen by 1.8 per cent this year.

ICG said the recent approach from the Philip Lynch-led Moonduster consortium remains “extremely preliminary in nature”.

The ferry company said no details had been provided to the board about an offer price and it had not received any information on financing arrangements. “Consequently, there continues to be no certainty that an offer will ultimately be forthcoming,” ICG said.

Moonduster’s latest approach was made public by ICG’s board on October 23rd. It said Moonduster had requested six weeks to consult with other major shareholders to try and progress a bid.

Moonduster owns 25 per cent of ICG with property developer Liam Carroll holding just over 29 per cent and ICG’s managing director Eamonn Rothwell controlling about 16 per cent of the stock.

In its interim management statement yesterday, ICG said the economic outlook remained “challenging”.

“We have adjusted the frequency of our fast ferry service from Dublin to Holyhead from two round trips a day to one round trip during the off season,” the company added. “This will lead to fuel and other operational cost savings to counteract the weaker passenger demand. We have also taken further steps to reduce sales, distribution and other overhead costs.”

ICG’s group fuel costs rose to €40 million from €25 million for the same period of 2007. The company said the recent easing in the price of fuel would provide a “counterbalance to the weaker demand environment”.

On a positive note, ICG said its net debt at September 30th was €55.5 million, down from €70.3 million at the end of June. “This is the lowest level of debt since 1994 and leaves the group in a very strong financial position,” ICG added.

ICG’s share price was unchanged in Dublin yesterday at €15.50.