INTERIM REPORT, NOVEMBER 1, 2003 - JANUARY 31, 2004

SALES AND EARNINGS

During the period November 1, 2003−January 31, 2004, the consolidated sales of the Viking Line Group totalled 83.92 million euro (year-earlier period: 88.25 million euro). Operating profit was EUR −1.70 M (−0.98). Consolidated profit before taxes totalled EUR −1.82 M (−1.22). Profit after taxes was EUR −1.82 M (−1.22).

Due to lower passenger volume, the Group’s sales fell. Net sales revenues per passenger were largely unchanged. Among other operating expenses, vessel fuel (bunkering) costs and the costs of repairs and maintenance fell. Operating profit was lower than in the same period of fiscal 2002/2003.
 

TRAFFIC AND MARKET CONDITIONS

The Group’s vessels served the same main routes as during 2002/2003. Starting in September, the Cinderella was placed in cruise service on the Stockholm (Sweden)-Mariehamn (Åland Islands) route. The vessel previously provided cruises between Helsinki (Finland) and Tallinn (Estonia). Since mid-August, the Rosella has operated in scheduled service between Helsinki and Tallinn. The vessel previously provided cruise service between Stockholm and Mariehamn.

During the first three months of fiscal 2003/2004, the number of passengers on the Group’s vessels totalled 1,013,968. This was 6.1 per cent  lower than in the year-earlier period. The total passenger volume in Viking Line’s service area rose by 1.0 per cent compared to the year-earlier period. Viking Line’s cargo volume rose by 9.5 per cent to 20,180 cargo units.

During the period, Viking Line increased its passenger volume and market share in Sweden-Åland Islands (Finland) -Finnish mainland services. On the Helsinki-Tallinn route, passenger volume declined while cargo volume rose. Viking Line’s share of passenger traffic in its entire service area totalled 32.2 per cent (34.6). Its market share on each respective route was as follows: Helsinki-Stockholm, 40.2 per cent (41.1); Turku (Finland)-Stockholm/Kapellskär (Sweden), 42.6 per cent (42.5); services to the Åland Islands, 49.8 per cent (42.7); and Helsinki-Baltic countries 12.4 per cent (24.7). Viking Line’s share of the cargo market totalled 22.2 per cent (21.4).
 

INVESTMENTS AND FINANCING

The Group’s investments during the report period totalled EUR 0.91 M (0.58). On January 31, 2004, the equity/assets ratio was 54.1 per cent, compared to 51.3 per cent on the same date last year.

On January 31, 2004, the Group’s liquid assets amounted to EUR 45.83 M (47.48). Net cash flow from business operations amounted to EUR −0.58 M (4.26).

PERSONNEL

The average number of Group employees during the report period was 2,701 (2,740). Of these, 1,687 (2,093) worked for the parent company. Land-based personnel totalled 661 (664) and shipboard personnel totalled 2,040 (2,076).
 

OUTLOOK FOR THE FULL 2003/2004 FISCAL YEAR

The Group’s earnings are not generated evenly throughout the year. Earnings, which are especially difficult to predict this year, are highly dependent on volume and price developments during the remainder of the fiscal year. The changes in the rules on personal imports of taxed alcoholic beverages in intra-European Union passenger services, the imminent enlargement of the EU, the lowering of Finnish excise taxes on alcoholic beverages and the increased competition in Viking Line’s service area are nevertheless expected to have an adverse effect on the Group’s earnings. Developments to date do not justify any change in the outlook published with the latest annual financial statements, i.e. that earnings during the 2003/2004 fiscal year will be somewhat lower than 2002/2003 earnings.

This Interim Report is unaudited.

The next Interim Report (November 1, 2003− April 30, 2004) will be published on June 3, 2004.
 

When rounding off items to the nearest EUR 1,000,000, rounding-off differences of EUR ± 0.01 M have occurred.
 

Mariehamn, Åland, March 4, 2004
 

VIKING LINE ABP
The Board of Directors

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