Thursday, September 12, 2019

Freight and Passenger Ferry Services Get a Boost with Two New Vessels

Danes Give Dutch - UK RoPax Routes Extra Capacity
Shipping News Feature

DENMARK – UK – NETHERLANDS – DFDS has entered into an agreement with the Italian ferry company Moby to acquire the two combined freight and passenger ferries (RoPax) Moby Wonder and Moby Aki, to increase the capacity for both passengers and freight customers on the Amsterdam-Newcastle route. The ferries were built in 2001 and 2005, respectively.

Moby will in turn acquire the two passenger ferries currently operating on Amsterdam-Newcastle route, the King Seaways and Princess Seaways, built in 1987 and 1986, respectively. Peder Gellert Pedersen, EVP and Head of DFDS’ Ferry Division, said:

“The new ferries are ideally suited for our Amsterdam-Newcastle route. Their modern onboard facilities and higher car-deck capacity will allow us to grow revenue by fulfilling the growing demand from high-yield car passengers. To freight customers, we will be able to offer increased capacity that can remain constant throughout the year.”

The agreement is expected to be completed in the second half of October 2019. DFDS will subsequently bareboat-charter King Seaways and Princess Seaways from Moby until January and February 2020, respectively. Meanwhile, the acquired ferries from Moby will be refurbished to suit the Amsterdam-Newcastle route. This includes commercial and technical investments on board as well as port investments. The refurbished ferries are expected to be deployed on Amsterdam-Newcastle during the first quarter of 2020.

Freight capacity is estimated to increase by around 40% on a full-year basis. The car capacity should increase by around 5% on a full-year basis supported by a cabin configuration that DFDS says is well suited to the requirements of holiday-makers travelling by car.

In 2018, the Amsterdam-Newcastle route carried more than 600,000 passengers, 122,000 passenger vehicles and 350,000 lane metres of freight. DFDS says that the capacity increase will provide an opportunity to accommodate further growth in trade and travel, including a large tourism flow, between UK and Continental Europe.

June 2019 saw DFDS launch its ‘WIN23’ strategy based upon four strategic pillars of intent. The renewal of Amsterdam-Newcastle is a key part of the fourth pillar ‘Creating more value for passengers’. Torben Carlsen, CEO of DFDS, commented:

”I’m very pleased to already be able to tick off an important milestone of our WIN23 strategy. We now have a strong set-up to continue to grow the route.”

The expected completion in October 2019 of the sale of the two ferries is estimated to entail an accounting profit of around DKK 100 million to be recognised under Special items in Q4 2019. The full-year outlook for Special items is thus increased to DKK 70 million from previously DKK -30 million.

The investment in the renewal, including proceeds from the sale of Princess Seaways and King Seaways, is expected to amount to around DKK 1 billion of which DKK 650 million is expected to be paid in 2019. The remaining DKK 350 million is expected to be paid in 2020. The investment includes a substantial investment in refurbishment. The investment outlook for 2019 is therefore changed to around DKK 3.4 billion from previously DKK 2.8 billion.