The global uncertainty has not yet affected Royal Arctic Line’s freight volumes. Thus, freight volumes of goods to and from Greenland were at the same level as in 2021, sustained by major infrastructure projects and high employment.
The efforts to build a new market in collaboration with DHL, among others, are starting to bear fruit and volumes have increased by 400% in the first half of 2022 compared to the same period last year.
A number of major milestones were reached during the first half of the year. The last newbuildings were delivered and the extensive renewal of Royal Arctic Line’s fleet is now complete, and Royal Arctic Line is pleased to note that the renewal of the fleet and the associated financing was completed during a period of low inflation and low interest rates. Agreements have been made with external suppliers, which means that Royal Arctic Line is no longer responsible for handling general cargo outside Greenland, instead agreements have been made with strategic partners, which in the long term can provide opportunities to make it easier to send goods to and from Greenland regardless of whether you live in Nuuk or Tasiilaq. In other words, it will be easier for all of Greenland to trade with the outside world.
There was also a dignified farewell to the Port of Aalborg, where all parties involved negotiated good agreements early on, which helped ensure that operations at the Port of Aalborg continued without negative impacts until the last regular call at the port.
The discontinuation of the regular calls to Aalborg has resulted in a number of one-off costs that have had a negative impact on the half-year accounts. The total one-off costs amount to DKK 27 million. Excluding the one-off costs and increased depreciation due to the fleet renewal, the operating profit for the half-year ends at the same level as in 2021.
The half-year result is as expected and therefore the outlook for 2022 is maintained at a loss of DKK 56-66 million. Royal Arctic Line is aware of the high inflation and the risk of economic slowdown that the large interest rate hikes will bring. Therefore, we are working on a new rate structure that meets the global uncertainty and where the citizen and security of supply are highly valued.
