Q3 23: The fifty shades of volatile electricity prices

Getlink has released its Q3 revenue results, which were in line with market forecasts. This were driven by a rebound in Eurostar traffic, compensating for the decrease in shuttle service traffic. While Eleclink posted a robust operational performance, it faced challenges due to fluctuations in electricity prices. Nonetheless, thanks to secured contracts in Eleclink and the favourable momentum in Eurostar traffic, the company has reaffirmed its guidance.

H1 23: electricity prices fuel the top line

Getlink has published an expected set of H1 23 results. Revenues increased significantly due to the traffic recovery and Eleclink’s strong performance driven by high electricity prices. However, it’s worth noting that this growth is partly due to a lower comparison basis as Eleclink was commissioned in May 22. Getlink has confirmed its guidance to surpass €910m of EBITDA supported by revenues already secured and a promising Eurostar performance.

FY22: Eleclink as the main growth potential

Getlink published a good set of FY22 results. Revenues increased significantly due to the recovery in traffic and the start-up of ElecLink. On the other hand, the EBITDA was below our expectations due to a provision for future payments due from Eleclink. However, Getlink expects further revenue growth in 2023 and an EBITDA of above €910 million.

Q3 22: Volatile electricity market to drive profitability this year

Getlink published good Q3 revenue figures, which benefited from a traffic recovery (particularly car shuttle and Eurostar traffic) as well as a strong performance from ElecLink. The latter, in particular, has led to a positive revision in our FY22 earnings estimate although we expect this good performance to last only for the short term as it is driven by volatile electricity prices.

H1 22: promising ElecLink

Getlink published H1 22 results, which benefited from traffic recovery (particularly car shuttle and Eurostar traffic) as well as the launch of ElecLink in May. EBITDA rose sharply by 206%, thanks to higher pricing and well managed opex, where the impact of electricity and other cost inflation was overshadowed by the company’s cost-saving efforts. Even though we expect the FY22 results to be strong, we have taken a conservative stance for FY23 onwards, resulting in only a 5.6% increase in our ta

FY21: high hopes from easing restrictions

Getlink announced 2021 figures below our expectations. There was a further decline in the traffic compared to 2020 due to travel restrictions throughout the year. However, early 2022 traffic trends are promising, with about a 40% increase in shuttle traffic and Eurostar operating at 46% capacity, vs 6% in H1 21. The group has not provided a quantifiable outlook for FY22 and has proposed a dividend of €0.1/share.

H1 21: still looking for light at the end of the tunnel

Throughout H1 21, Getlink was impacted by the pandemic, pre-Brexit stockpiling, and stricter border control, yet it managed to achieve a high shuttle yield while maintaining market share and deliver €45m in opex savings. The group has not provided a financial outlook for the full year given the low short-term visibility on traffic.

Q1 21: still waiting for some visibility

No surprises, Getlink announced weaker Q1 21 results, with revenue down 33% yoy. Shuttle revenue was impacted by travel restrictions, pre-Brexit stockpiling in FY20, and by border control introduced in 2021. Railway Network revenue was down 51% due to travel restrictions still in force. Traffic at Eurostar was down by 95%. Europorte continued to show resilience with sales up by 4%. The result was quite in line with our expectations; hence, we will not make substantial changes to the model.

FY20: blurred outlook for 2021

Getlink announced 2020 bottom-line figures below our expectations. It saw a sharp decline in traffic, with the drop in truck shuttle traffic less profound than others due to the robust demand for essential goods and Brexit-driven stockpiling. It has delivered €40m in cost-savings and has introduced a split in the functions of the CEO and the Chairman. The group has provided no outlook for FY21 and has proposed a dividend payment of €0.05/share.

Sinking Eurostar could trouble Getlink too

Eurostar, the train operator that runs services through the Channel Tunnel, has shrunk from a cheetah to an ailing cat. The company is struggling for survival and is currently negotiating with the British government for a bailout, but the most likely outcome from this negotiation will be a no. Since Eurostar is a major user of the Channel Tunnel, Getlink could see a ripple effect and, hence, we have narrowed down a couple of possible scenarios for Eurostar going forward.

Supreme (SUP LN) - Record performance, EBITDA ~doubled

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