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Investor presentation October 2006 Riga

Investor presentation October 2006 Riga

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Investor presentation October 2006 Riga

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  1. Investor presentation October 2006 Riga

  2. Financial Year 2005/2006 • KEY EVENTS • Successful IPO and listing on the Tallinn Stock Exchange in December 2005; • Ordering of a new cruise ferry, a sister vessel of M/S Galaxy; • The delivery of M/S Galaxy; • Starting operations between Riga and Stockholm; • The acquisition of Superfast vessels and the launch of Finland - Germany service; • The sale of M/S Autoexpress; • M/S Fantaasia chartered to Mediterranean from; • Acquisition of Silja ferry business; • Rights Issue to the shareholders.

  3. Financial year 2005/2006 9 months Key Figures

  4. Tallink’s vesselsHigh-quality, flexible fleet High-speedFerries Cruise Ferries Romantika Victoria I Galaxy AutoExpress 2 Meloodia I Regina Baltica Fantaasia Vana Tallinn Ro-ro Cargo Ferries Fast Ro-pax AutoExpress 3 Regal Star AutoExpress 4 Superfast VII , Superfast VIII , Superfast IX Kapella As a result of its ongoing investment and fleet renewal program, Tallink deploys some of the most advanced cruise ferries in the region.

  5. Silja’s vesselsHigh-quality, flexible fleet Cruise Ferries Ro-paxFerries Silja Serenade Silja Symphony Sky Wind Silja Europa Silja Festival Sea Wind As a result of its ongoing investment and fleet renewal program, Tallink deploys some of the most advanced cruise ferries in the region.

  6. Share price December 2005 – September 2006 € • Since listed on the Tallinn Stock Exchange, a large proportion of turnover is derived directly from trading Tallink’s shares • 34.9% of Tallinn Stock Exchange share turnover (09.12.05 – 18.09.06) • 20.0% of Total Baltic Market share turnover (09.12.05 – 18.09.06) Tallink 6.0 600 Baltix 5.5 550 5.0 500 4.5 450 4.0 400 3.5 350 3.0 300 December January February March April May June July August September Source: Tallinn Stock Exchange

  7. Tallink in brief • Tallink is the biggest ferry operator in Northern Baltic Sea offering mini-cruise, passenger transportation and ro-ro cargo transportation services. • 21 vessels linking 10 ports on seven routes between: • Finland and Estonia; • Finland and Sweden; • Sweden and Estonia; • Sweden and Latvia; • Finland and Germany. • 350 room hotel operation in the center of Tallinn • Annualrevenue base over 620 million euro * • Over 6,000 employees • More than 6.5 million passengers annually * * Combined with the 12 months pro forma figures of the acquired Silja Line ferry business

  8. Tallink: The strongest in the Baltic Sea • Outstanding macro fundamentals • Strong market position • High-quality, flexible fleet • Broad product offering • Strong brands • Competitive cost base • Experienced management team “The biggest Northern Baltic shipping group providing high-quality mini-cruise and passenger transport services, as well as a leading provider of ro-ro cargo services on selected routes”

  9. Mini-cruise, Hotel and Travel Packages Tallink business model Product Offering Success Story and Growth Drivers • Broad transportation, leisure and retail product: complete mini-cruise and overnight hotel & spa packages, city-break day trips, high-speed ferry and cargo • Highly popular mini-cruise product across Scandinavia and the Baltics with extensive onboard retail and entertainment facilities • Our destinations are attractive and lucrative for tourism and shopping destination • Significant demand from business customers, tourism and cargo traffic boosted by EU accession High-speed, Passenger and Cargo Traffic

  10. Tallink passenger growthStrong passenger growth over the past decade Total Tallink Passenger Volumes Over the past decade, Tallink has outperformed a fast-growing home market and is set to capitalise further on Tallinn’s growing attractiveness as a tourist destination. 10

  11. The Baltic ferry sector in a global contextTallink: Positioned at the heart of an exciting growth market Passenger Traffic – Global Passenger Traffic – Baltic and Scandinavia 600 15,0 16 20% 536 14 16% 500 12 12% 400 9,4 10 8,5 (in million) (in million) 8% 291 6,2 300 8 4,1 4% CAGR 1996-2004 187 6 166 2,6 200 133 0% 4 1,3 100 0,9 -4% 2 0,7 0,6 24 0 -8% 0 DK-SE* FI-SE DK-D FI-E DK-N D-SE N-SE PL-SE SE-E D-N Asia America Baltic Med North Sea Pacific Trailer Traffic – Global Trailer Traffic – Baltic and Scandinavia 12 1,0 20% 10 0,8 10 16% 0,8 7 8 7 0,6 12% (in million) 0,6 (in million) 6 8% 0,4 4 0,4 CAGR 1996-2004 4 4% 0,3 0,2 0,2 0,1 0,04 0,2 2 1.0 0% 0,1 0.4 0,03 0,0 -4% 0 D-SE DK-SE* DK-D FI-SE PL-SE FI-E DK-N SE-E D-N N-SE North Sea Med Baltic Asia America Pacific *Note: Red Sea region excluded due to negligible volumes; North Sea includes Inland Lakes Europe; Domestic Baltic and Scandinavian markets excluded DK – Denmark; SE – Sweden; FI – Finland; D – Germany; E – Estonia; N – Norway; PL – Poland; DK-SE includes data from Oresund bridge crossing Source: ShipPax, 2004 & 1996 data;

  12. Tallink routes • Tallink operates between: • Helsinki and Tallinn; • Stockholm and Tallinn; • Paldiski and Kapellskär; • Stockholm and Riga; • Hanko and Rostock; • Helsinki and Stockholm; • Turku and Stockholm/Kapellskär. • Northern Baltic Sea region –17 million passenger market

  13. Nordic Jet Line Linda Line 3% 7% Eckerö Line 14% 43% Viking Line 15% Sea Containers 18% Finland – EstoniaHelsinki – Tallinn Customers and Products Market Share • Helsinki – Tallinn • Revenues mainly from onboard and ticket sales • Approximately 80% of the passengers are Finnish • 3.5 hour trip with day ferry • 1 hour 40 minute trip with high-speed ferry • 22 hour over-night cruise with “Galaxy” • Investments • In 2002 and 2006 two brand new vessels • In 2007 brand new Ro-pax ferry will be introduced Key Words • Developing passenger market • Increased cargo demand Galaxy Meloodia Regal Star Auto Express 2 Auto Express 3 Auto Express 4

  14. Viking Line 44% Turku-Stockholm 56% Viking Line 43% 57% Finland – SwedenHelsinki – Stockholm; Turku – Stockholm/Kapellskär Customers and Products Market Share Helsinki-Stockholm • Helsinki – Stockholm • Revenues mainly from onboard and ticket sales • Approximately 65% passengers are Finnish • Over-night cruise Silja Serenade Silja Symphony • Turku – Stockholm/Kapellskär • Revenues mainly from cargo and ticket sales • Majority of passengers are Finnish • Over-night and day trips Key Words • Tax-free status (via Aland islands) • Strong brand – Silja • Loyal passenger base • Increased cargo demand • Overnight cruise • City-break • Hotel package sales Silja Europa Silja Festival Sea Wind / Sky Wind

  15. Sweden – EstoniaStockholm – Tallinn; Kapellskär – Paldiski Customers and Products Market Share • Stockholm – Tallinn route • Revenues mainly from onboard and ticket sales • Approximately 70% of passengers are Swedish • Over-night cruise • Tallink is the only provider of daily passenger and ro-ro cargo services on the routes between Sweden and Estonia Key Words • Tax-free status (via Aland islands) • High development potential • Overnight cruises • City-breaks • Hotel package sales Romantika Victoria • Paldiski – Kapellskär route • Revenues mainly from cargo and ticket sales • Approximately 70% of passengers are Estonian • 11,5 hour trip Vana Tallinn Kapella

  16. Sweden – LatviaStockholm – Riga Customers and Products Market Share • Stockholm – Riga route • Revenues mainly from onboard and ticket sales • Approximately 70% of passengers are Swedish • Over-night cruise • Tallink is the only provider of regular passenger and ro-ro cargo services on the route between Sweden and Latvia Key Words • High growth potential • Overnight cruise • City-break • Hotel package sales Regina Baltica

  17. Power-line 4% 29% Transfennica 21% Finnlines 46% Finland – GermanyHanko – Rostock Customers and Products Freight Market Share in 2005 • Hanko – Rostock route • Revenues mainly from cargo sales • 24 hour trip Superfast VII Superfast VIII Superfast IX • High quality fast ice-classed vessels Key Words • The fastest link between Finland and Germany • High cargo space utilization • Potential in passenger transportation

  18. Proven strategyMarket leadership and investment for profitable growth • Continue to invest in our fleet • Central to maintaining market leadership and growing our business • Enhanced efficiency and profitability • Increased per-passenger spend from a wider demographic customer base • Further strengthening of the Tallink & Silja brands • Build upon strong positions on existing routes • Strengthen overall market share and volumes • Further increase strong brand recognition • Broader customer base • Enhanced mini-cruise experience and promotion of our different travel destinations • Pursue new growth opportunities in the North Europe region • Potential route expansion • Travel-related products, services and packages • Maintain profitability through efficient and flexible management while seeking revenue growth

  19. High quality fleetSophisticated and modern vessels Ferries Built for the Region New Cruise Ferry II Europa High-speed ro-pax II Superfast VII and VIII Gabriella Symphony High-speed ro-pax I Victoria I Galaxy Superfast IX Serenade Cinderella Paradise* Romantika 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 Year Cruise Ferries High-speed Ro-pax Ferries • Fleet renewal • Higher quality of onboard facilities • Increased passenger, cargo and retail capacity • Increased profitability through lower cost per passenger • Helsinki–Tallinn in less than 2 hours • Increased passenger, cargo and retail capacity • Expanded onboard consumption and retail facilities • Reduce seasonality through ice-class specification *Note: Pure cruise vessel with no separate cargo or passenger car deck

  20. 3 500 200 3 000 3 274 150 2 828 2 500 131 2 598 2 000 103 95 Passengers (in '000) Cargo units (in '000) 100 1 500 1 000 50 500 0 0 02/03 03/04 04/05 02/03 03/04 04/05 Strong operational and financial track recordSignificant growth momentum across all key indicators Passenger Growth Since 02/03 Revenue Growth Since 02/03 Cargo Growth Since 02/03 *Note: Excludes revenue from cargo operations EEK/€ pegged since 1999 (EEK15.6466 = €1) Profitable growth is key to Tallink’s success – this has been demonstrated over the past three years and will remain central to its investment case going forward.

  21. Group financial data (in € million) 2002/2003 2003/2004 2004/2005 *Note: (1) ROE represents net profit / average equity for the period (2) Equity Asset ratio = shareholders equity / total assets EEK/€ pegged since 1999 (EEK15.6466 = €1)

  22. Investor presentation October 2006 Riga