Introduction
Eimskip’s operations are divided into two principal market segments: Liner services in the North Atlantic and international forwarding services.
LINER SERVICES
- The core of the Company’s operations
- Eimskip’s home market includes Newfoundland and Labrador, Greenland, Iceland, the Faroe Islands and Norway
- 15 vessels and 2 ferries in operation
- Terminal operations
- Chilled and cold storage facilities
- Warehousing
- Trucking and distribution
- Air freight services
- Agency services
FORWARDING SERVICES
- Main focus on reefer forwarding; dry cargo forwarding is growing
- Efficient system based on a network of 57 own offices in 20 countries
- Cooperation between Eimskip’s own offices, its worldwide network of associates and international deep-sea lines
In 2021, 57.5% of Eimskip’s revenue came from liner services and 42.5% from forwarding services. The division of EBITDA in 2021 was as follows: 65.2% from liner services and 34.8% from forwarding services. The geographical division of revenue was showing a decreasing share of Iceland related business, which contributed 40.3% of total revenue.
REVENUE BY BUSINESS SEGMENT
EBITDA BY BUSINESS SEGMENT
DEVELOPMENT OF EBITDA BY BUSINESS SEGMENT
EUR million
* As at 1 January 2019, IFRS 16 was implemented. The effect of IFRS 16 was that the accounting treatment of leases was changed whereas the leases were recognized as an depreciable asset and a interest bearing liability and that shifted the expenses that were previously recognized as expenses among EBITDA to depreciation and finance expenses.
GEOGRAPHICAL SPLIT OF REVENUE
LINER SERVICES
Eimskip’s liner services are the core of the Company’s operations. Eimskip operates a dynamic container sailing system in the North Atlantic, with 17 vessels currently in operation. The Company’s home market includes Newfoundland and Labrador, Greenland, Iceland, the Faroe Islands and Norway. Eimskip also offers short-sea services in Europe and North America, Trans-Atlantic services, and bulk transport. Liner services include terminal operations, chilled and cold storage facilities, warehousing, trucking and distribution, air freight services, agency services and ferries.
KEY STATISTICS
The revenue for liner services in 2021 amounted to EUR 507.7 million; an increase of 26% from 2020 due to e.g. increased volume and active revenue management. The EBITDA from the liner services amounted to EUR 74.5 an increase of EUR 35.9 million from previous year. EBIT from liner services in 2021 amounted to EUR 30.4 million compared to EUR 0.8 million in 2020. In 2021, liner services accounted for 57.5% of the Company’s revenue and 65.2% of its EBITDA.
Transported volume in Eimskip’s liner services in 2021 grew by 4.8% from the previous year. The volume increase can mainly be attributed to increased economic activity in key markets, capacity increase on the Trans-Atlantic route as well as acquiring new customers, especially in the Trans-Atlantic services. Volume in export services from Iceland was strong especially in the second half of the year. Volume to and from the Faroe Islands decreased between years, with the first half of the year being challenging on account of COVID-19 and Brexit related issues, however the last quarter of the year was strong in export from the Faroe Islands. The reefer liner services performed well financially although volume was on similar level as the previous year.
The graph below shows the volume development from 2017 to 2021.
VOLUME DEVELOPMENT IN LINER SERVICES
Changes from previous year
LINER SERVICES VOLUME
Iceland, Faroe Islands, Norway and Trans-Atlantic
HOME MARKET
Eimskip defines its home market as the North Atlantic, from the east coast of North America to the west and north coasts of Norway, including Newfoundland and Labrador, Greenland, Iceland, the Faroe Islands and Norway. These countries are all niche market areas, rich in natural resources and with small populations. Seafood represents a substantial part of the total cargo in the Company’s home market.
SAILING SYSTEM
Eimskip is constantly re-evaluating its sailing system and vessel fleet with the aim of optimizing operational efficiency and customer service. Since November 2020, after Eimskip’s addition of the Company’s two new container vessels, Dettifoss and Brúarfoss, the sailing system has proven to be a reliable system, supporting service on core sailing routes and designed to better meet customer needs. In 2021 some adjustments were made to the system in order to give transportation of fresh fish between Europe and America more focus and these changes proved to be very successful.
Eimskip operates seven container vessels sailing between Iceland, the Faroe Islands, Greenland and ports in Scandinavia and Europe. Additionally, the Royal Arctic Line vessel Tukuma Arctica sails between Greenland and Scandinavia, also calling on ports in Iceland and the Faroe Islands. Three container vessels ensure a weekly service between Iceland and North America. A further three reefer vessels serving the Norwegian coast, and onwards to the Netherlands, England and Scotland
SAILING SYSTEM IN THE NORTH ATLANTIC
Sailing routes
The Blue Line offers express services for both import and export between Reykjavík and Rotterdam. With fast sailing times, this route is ideal for fresh fish, fruits, vegetables and other perishable products. The vessels serving on the Blue Line are Vera D and Jonni Ritscher.
The Yellow Line offers express services, suited to fresh fish for example, from Iceland and the Faroe Islands to the UK and continental Europe and bi-weekly Fredrikstad. The vessels serving on the Yellow Line are EF Ava and Skógafoss.
The Red Line hosts a vessel-sharing agreement with Royal Arctic Line (RAL) and offers weekly services with larger vessels and greater reliability. Sailings are to and from all major ports in Scandinavia, the Faroe Islands, Iceland and Greenland. The vessels serving in the Red Line are Dettifoss, Brúarfoss and RAL’s Tukuma Arctica.
The Green Line offers weekly services from Iceland to the east coast of the United States, Nova Scotia, Newfoundland, and then back to Iceland with regular Iceland coastal service. It connects to the other European Lines in Reykjavík, enabling Trans-Atlantic services. The vessels Lagarfoss, Selfoss and Vivienne Sheri D serve on the Green Line.
The Purple Line offers weekly services between the Faroe Islands and Scotland. This Line plays an important role in serving the salmon industry in the Faroe Islands. The vessel serving on the Purple Line is Vantage.
The Orange Line offers weekly services from Murmansk in Russia, down the Norwegian coast, and onwards to the Netherlands, England and Scotland, before returning to Norway. The vessels serving on the Orange Line are Svartfoss, Polfoss, Holmfoss and Silver Star.
VESSEL FLEET
Eimskip currently operates seventeen vessels, of which nine are owned vessels and eight are chartered. Thirteen of the vessels are used in scheduled liner services on six different sailing routes. Ten are container vessels and three are reefer vessels. In addition, one reefer vessel offers spot services, one is in bulk services, and two are ferries operated in Iceland.
All the vessels are highly competitive in terms of their size, cranes, reefer plugs, shallow draft, and maneuvering capabilities.
VESSEL FLEET
Jonni Ritscher
Vera D
Dettifoss
Brúarfoss
Vivienne Sheri D
EF Ava
Skogafoss
Selfoss
Lagarfoss
Vantage
Holmfoss
Polfoss
Svartfoss
Silver Bird
Saxum
Baldur
Saerun
OPERATIONS AND OPERATING ASSETS
The Company operates terminals at 15 locations in five countries: seven in Iceland, two in the Faroe Islands, three in Norway, two in Canada and one in the USA. Eimskip owns or operates 14 chilled and cold storage facilities in five countries: seven in Iceland, three in Norway and two each in the Faroe Islands, Newfoundland and Labrador. Eimskip also operate 32 warehouses for dry cargo in nine countries: 15 in Iceland, seven in the USA, two in the Faroe Islands, two in the UK, two in Norway and one each in Sweden, Denmark, the Netherlands and Vietnam.
Eimskip’s container fleet currently consists of around 28,800 TEU. Trucking and distribution services are operated in Iceland, the Faroe Islands, Denmark, the Netherlands and the USA, and the Company owns around 157 trucks.
GLOBAL OPERATIONS AND OPERATING ASSETS
FORWARDING SERVICES
Eimskip is a niche player in forwarding services. The Company specialize in reefer forwarding – the transportation of temperature-controlled cargo, seafood products in particular.
Over the years, Eimskip has built valuable relationships and acquired extensive know-how in the reefer forwarding trade, both through the Company´s operations and the acquisition of specialist forwarding companies. Eimskip success is based on a global network of deep-sea lines managed via numerous Eimskip offices and those of the Company´s associates. Eimskip also employs a range of logistics solutions to forward dry cargo worldwide.
KEY STATISTICS
Forwarding services delivered a strong performance despite being affected by unusual conditions in the global transportation markets characterized by shortage of space on vessels and available equipment, especially reefer equipment. Capacity reduction and price increases by global carriers contributed both to increased revenue and expenses but with higher margins. Revenue amounted to EUR 375.0 million, an increase of 41% from the previous year. The EBITDA from forwarding services was EUR 39.8 million, an increase of EUR 16.7 million from 2020. Forwarding services accounted for 42.5% of the Company’s revenue in 2021 and 34.8% of its EBITDA.
In 2021, transported volume in Eimskip’s forwarding services, including reefer and dry cargo forwarding, decreased by 4.0% from the previous year, which is acceptable in light of a challenging year.
The graph below shows the volume development from 2017 to 2021.
VOLUME DEVELOPMENT IN FORWARDING SERVICES
Changes from previous year
FORWARDING SERVICES VOLUME
Reefer and dry cargo forwarding