Havila Kystruten AS: Third quarter 2025 accounts

Core Insights - Havila Kystruten (HKY) demonstrated strong operational performance in Q3 2025, with a significant increase in earnings and a positive EBITDA of MNOK 283, up from MNOK 128 in Q3 2024 and MNOK 79 in Q2 2025 [1] Revenue Growth and Operational Performance - Operational revenues reached MNOK 416, reflecting a 13% year-over-year increase, and approximately 20% when adjusted for accounting effects [2] - The growth was driven by a 5% increase in passenger nights and a 17% rise in the average cabin rate (ACR) [2] - Fleet occupancy improved to 80%, up from 78%, with the cabin factor increasing from 1.86 to 1.89 [3] Government Contract Revenue - Government contract revenue increased due to a compensation adjustment of MNOK 146, with MNOK 103 related to prior years and MNOK 43 for the first three quarters of 2025 [4] - Projected contract revenue for 2026 has been revised to MNOK 426, reflecting a positive adjustment of MNOK 60 compared to earlier expectations [4] Cost Structure and Expense Drivers - Total operating expenses rose by 9% compared to Q3 2024, with the largest increase in Cost of Goods Sold (COGS) at 20% due to higher passenger numbers [5] - Payroll and personnel expenses increased by 5%, while other operating expenses also rose by 9% due to advisory fees and higher maintenance costs [6] Financing and Capital Structure - The Company amended its secured bond in July 2025, resulting in a new principal amount of MEUR 326, leading to a reported book equity of negative MNOK 1,232 [7] - The value-adjusted equity, considering the market value of vessels, is estimated at positive MNOK 2,783 [7] Sustainability and Efficiency - HKY reduced CO₂ emissions by 38% compared to the 2017 Coastal Route baseline and achieved a food waste reduction to 60 grams per guest per day [8] Employee Overview - As of September 30, 2025, HKY employed a total of 575 permanent employees, including 518 seafarers [9] Subsequent Events and Trading Outlook - A reverse stock split was completed on November 7, 2025, consolidating 50 shares into one share with a nominal value of NOK 50.00 [11] - The Company entered a comprehensive refinancing of its outstanding debt totaling MEUR 456, providing a 15-year financing structure [12] - As of now, 72% of the capacity for 2025 is booked, with 44% of capacity for 2026 already booked, indicating strong demand [13] Market Position and Strategy - The market for travel to Norway is growing, with HKY's modern fleet receiving multiple international awards, enhancing its competitive advantage [14] - The Company aims to increase direct bookings and optimize margins through targeted pricing strategies and product promotions [15][16] - Sales of shorter voyages increased by over 40% during the summer season, indicating strong market interest and potential for attracting a broader customer base [17]