Fjord Line Clamps Down on Costs
Norwegian ferry operator Fjord Line has implemented a program for strengthening the company’s financial position through raising of NOK 110 million (USD 15.4m) in fresh capital, as well as various measures to reduce operating costs by NOK 70 million (USD 9.8m) in 2015 compared to a ”challenging” 2014.
Fjord Line has also signed an agreement with the holders of the company’s NOK 300 million (USD 41.9m) bond to defer repayment from 2016 to 2018. In addition, Fjord Line and its banks have agreed on amending the repayment profile for long-term debt, reducing annual installments by 40 percent over the next four years, as well as agreeing on changes to certain loan covenants. These agreements will be formalized shortly.
“The year of 2014 presented greater challenges than we anticipated at the beginning of the year. But we have now built the foundation we need to stay on course on all four of our routes in 2015,” said Fjord Line CEO Ingvald Fardal. ”This fall, we implemented an extensive cost control program in which the whole organization takes the steps needed to reduce operating costs by NOK 70 million in 2015. Our goal, as announced earlier, is for Fjord Line to be profitable as of next year, turn, and we have now been given the economic room to maneuver and make that happen.”