2022 Newsletter week 32

Optimistic is the outcome for the Hellenic Coastal Shipping according to the recent XRTC 21^st annual ferry report 2022 which was published under the title: “Hellenic Coastal Shipping 2022: In a new Cycle of Development and Opportunities”.

The main points of the report are the following:

• The Hellenic Coastal Shipping today faces a series of problems and challenges that have not been seen in recent decades (effects of the pandemic, catastrophic drop in transport demand in 2020 and 2021, extremely high fuel costs, difficulty of new investment schemes and financial organizations to enter the market).
• The biggest weakness of the ferry market in the last 14 years, especially since the start of the Greek debt crisis, is the lack of business models that will bring new capital to a market that has to be profitable to justify new investments.
• A positive mark in the market, is the introduction of the three newbuilding Aero high-speed crafts of the Attica Group (HSW), which may also can be seen as a signal of the start of a fleet renewal.
• For the summer season 2022, 100 ferries are active and serve daily 115 islands
• In total, the three largest ferry companies in Greece operate 43 ships and carry 5,776,000 passengers, 1,215,000 cars and 585,000 trucks.
• Attica Group operates 30 ships, transports 4.4 million passengers, 870,000 cars and 370,000 trucks.
• Minoan Lines operates 4 ships and transports 724,000 passengers, 162,000 cars and 82,000 trucks.
• ANEK LINES operates 9 ships and transports 652,000 passengers, 183,000 cars and 133,000 trucks.
• The medium size ferry operators are three. SEAJETS (20 high-speed crafts – 4 conventional ferries), FAST FERRIES (3 conventional ferries plus 1 high-speed craft) and LEVANTE FERRIES (4 conventional ferries plus 2 under conversion).
• The small ferry operators are 22 and operate in total 21 ships.
• The total debt obligations of the two larger ferry groups of the Hellenic Coastal Shipping (Attica Group and ANEK LINES) are increased by 9% (EUR 742 million in 2021 from EUR 683 million in 2020). The third major player, Minoan Lines (Grimaldi Group), has zero bank borrowing after paying off its bond in full.
• The major challenge for the Hellenic Coastal Shipping is the fleet age. The Hellenic Coastal fleet operates 43 ships with an average age the 23 years, which steadily rises
• Around 70% of the fleet is over 20 years old, which means that the needs of fleet renewal are imperative for all sizes of ships.
• Passenger and vehicle traffic in 2021 was increased by 47% and 37% respectively compared to 2020.
• Despite the large increase in the traffic in the years 2021 and 2022 compared to the disastrous 2020, the financial results of the companies were not and will not be satisfactory mainly due to the excessively increased fuel costs
• The negative financial results of the sector question the viability of several ferry companies, but also create a negative environment for mergers and acquisitions without significant losses for shareholders and investors
• The analysis of all the signs of the market, including the Strengths and Weaknesses but also the Opportunities and Threats, certify that the Greek Coastal Shipping is now at the beginning of a new cycle of development and opportunities within a transparent environment and with respect to the institutions and the international financial rules.