ICG sees tourism bookings recover after Brexit wobble

Earnings at Irish ferry group rose 19.6%, driven by car and freight volumes

Since the end of June, total ICG passenger numbers have fallen by 3% on the same period in 2013. A 2% increase in cars carried have taken the sting out of a 15% drop in foot passengers. Photograph: Eric Luke

Irish Continental Group said the Brexit vote "shock" had a brief impact on tourism bookings. But they have since recovered as the ferry operator reported a 19.6 per cent increase in earnings for the first half.

Earnings before interest, tax, depreciation and amortisation (ebitda) rose to €30.5 million from €25.5 million for the same period last year. Cars carried on its ships increased 5.5 per cent and roll-on, roll-off (RoRo) freight volumes gained 5.6 per cent.

Container volumes shipped during the period rose by 7.4 per cent, it said.

The result of the June Brexit referendum “had an initial negative impact on UK consumer demand”, said ICG. “The demand situation seems to have settled now as the initial shock of the referendum result has waned, although the negative sterling impact on yields remains.”


ICG said the outlook for the remainder of the year “is for a continuation of the overall business momentum seen to date, with some easing in our tourism revenues, growth in our RoRo and LoLo (lift-on, lift-off) revenue, and increased contribution” from chartering ships to third parties.

Total revenues rose by 5.2 per cent on the year to €150 million, while basic earnings per share increased 32 per cent to 10.3 cents. ICG will pay out a 3.82 cent dividend for the first half, up 5 per cent on its last interim dividend.

Strong numbers

“These as strong numbers from ICG, albeit they required some discounting by ICG in the car market, and the business will of course be hit by sterling translation issues this year,” said Stephen Furlong, an analyst with stockbroker Davy.

Mr Furlong says he plans to “modestly trim” his full-year ebitda estimate to €83 million from €85.2 million.

Shares in ICG fell by 3.8 per cent in early trading in Dublin on Wednesday, to €4.62.

Since the end of June, total passenger numbers have fallen by 3 per cent on the same period in 2013. A 2 per cent increase in cars carried on ICG services have taken the sting out of a 15 per cent drop in foot passengers, which the company says is of less significant part of its tourism performance.

RoRo freight carryings have remained strong, with total units carried rising 4 per cent on the year.

ICG’s container and terminal division container carryings rose 1 per cent since the end of June.

Downpayment due

Net debt at the group fell 57 per cent from the end of December, to €18.9 million, it said. Goodbody Stockbrokers sees the debt level increasing to €40 million by the end of year as a downpayment falls due on ship being built for the company.

Three months ago, ICG entered an agreement with German company Flensburger Shiffbau-Gesellschaft to build a cruise ferry for the Irish company at a contract price of €144 million. This is scheduled for delivery in 2018 and will be financed through cash and loans.

The ferry is expected to replace the MV Epsilon, which currently works on Dublin-Holyhead routes midweeek and Ireland-France on weekends.

ICG also took delivery on June 1st of a new vessel, the high-speed craft Westpac Express, which it acquired for $13.3 million (€11.9 million). It is currently on charter to a third party.

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times