ICG earnings drop 16% following ferries disruptions

Challenging year for ferry company as late delivery of vessel causes cancellations

The late delivery of new Irish Ferries ship WB Yeats caused cancellations.Photo: Leon Farrell/Photocall Ireland.

The late delivery of new Irish Ferries ship WB Yeats caused cancellations.Photo: Leon Farrell/Photocall Ireland.

 

Ferries operator Irish Continental Group (ICG) saw its earnings drop almost 16 per cent last year as the group suffered technical issues with its Ulysses vessel and cancelled sailings between Ireland and France last summer due to the late delivery of a new ferry, WB Yeats.

Earnings before interest, tax, depreciation and amortisation (ebitda) dropped by 15.6 per cent to €68.4 million, while earnings per share (eps) slid 25.5 per cent to 21.1c.

“2018 was a challenging year operationally but one in which significant progress was made in the strategic development of the group,” said chairman John B McGuckian. “Whilst mindful of the uncertainty created by the proposed exit of the UK from the EU, trading in the year to date has been encouraging.”

ICG’s Irish Ferries unit brought a High Court challenge on Monday to a finding by the National Transport Authority (NTA) in January that it must pay compensation to thousands of passengers affected by cancellations as the delivery of the WB Yeats was delayed for several months.

“We also believe that the EU Regulation covering sea passengers should be comparable with other modes of transport,” the company said on Thursday. “This is not the case under current EU Regulations as airline passengers have no right to compensation in the event of cancellations where they have been given a minimum of two weeks’ notice whereas, under the NTA interpretation of the EU Regulation, sea passengers have a right to compensation even if 2 years notice is given of a cancellation.”

The group claimed that uncertainty caused by the NTA interpretation of EU rules led it to close one route from Rosslare to France. That was signalled before Christmas.

“We believe it is in the best interests of our customers to protect the viability of direct links to the Continent which is now all the more critical against the backdrop of the proposed UK exit from the EU,” ICG said.

Although earnings at the group dropped last year, it is still proposing a 5 per cent increase in its dividend to 8.56c per share.