It’s not about profit, it’s in the growth

  • Eugene Ogo

The group "Business" has finished the first phase of investment in its port complex in Tsemess bay and preparing for the second — to take ocean-going vessels. With the right approach, excellent port facilities can earn

  • It's not about profit, it's in growth investing, long-term forecasts, Russia
  • It's not about profit, it's in growth investing, long-term forecasts, Russia

A landmark event for the Russian grain market occurred in early June, while remaining virtually unnoticed by the federal media. Group of companies "Business" has launched a new rail line to its grain terminal — KSK. This increased the capacity of the terminal from 2 million to 3.5 million tons per year, and the whole capacity of the Novorossiysk terminal on grain now grown from 11 million to 12.5 million tons.

 

Even the additional 14% of port facilities are very important for grain exporters. "The new terminal with the railway line creates competition for a very limited market of stevedoring services for grain. Any additional terminal greatly change the picture on the market and gives us as customers more options and flexibility, "- said" expert "director of grain trading company" Autspan International " Alexander Basarabians.

After starting the railway KSK stands on a par with other grain terminals Tsemess Bay — Novorossiysk plant bakeries and Novorossiysk grain terminal (NKHP and NRT, both affiliated with the Novorossiysk Commercial Sea Port, NCSP). "Well, that is client-oriented stevedore who has no independent grain trading ambitions. In our time, it is a rarity, "- adds a representative of the" Autspan International ".

In general, the launch of a new railway line — is the completion of an extensive investment in port facilities, launched the "business" three years ago.

The aging of the investor

The company "Business" was born back in 1993, but participation in large-scale redistribution of assets and loans for shares it did not take. The creators of the company focused on freight forwarding services in the port of Novorossiysk, and succeeded in doing so: implemented new technology stevedore handling steel coils, slabs, it is the "thing" was first attracted to Novorossiysk cargo in containers. By the late 1990s, the company has become not only the largest freight forwarder at the port, but also the owner of the package in the NCSP and its subsidiaries — "NLE" (NLE), "Importpischeprome" (IPP), Novorossiysk Shipyard (NCRP), and so on. But control of the Novorossiysk port was not available, and in 2005 it was decided to develop their own. Minority interests in the NCSP and its "daughters" have been sold, and the proceeds went to buy up the remaining market players. Even then, in Novorossiysk felt infrastructure deficit. All tidbits — berthing racks, base port business — were concentrated in the hands of the NCSP and the price of land, giving access to the sea, were extremely high.

"Cause" was lucky in the south-eastern part of the port remained independent players who are not interested in the NCSP. Together with the "Severstaltrans» (N-Trans) «It" acquired one of them, Novorossiysk node forwarding company (NUTEP). The main asset NUTEP — pier for the ferry, so-called Ro-Ro — berth for road transport, which itself calls in and drives off the ship. At this pluses NUTEP ended. But the cons were listed in the moorland, cut off from the railway infrastructure and uncertain legal status. "The area NUTEP was distributed among several companies. We have it all put together into a single entity, and began construction of a container terminal, "- says the president of SC" Case " Timothy Telyatnik.

The next breakthrough company has made in five years. The "case" has got to the neighboring plant "Stroykomplekt" (CSC), and then bought a 50 percent stake in NUTEP at NCC. "Since we do not have even a minority, we can make decisions quickly. So we decided that we should buy a faucet — went and bought it. We do not have complex conciliation, we proceed from the needs of the business. This gives us the flexibility and speed in decision-making, "- says Timothy Telyatnik internal corporate relations.

On the basis of NUTEP and CSC "case" was to develop just four lines of business: container terminal, grain terminal, bunkering (refueling ships) and ferry ro-ro. In this case, container and grain terminal — the main assets which bring today the greatest revenue, they, as well as Ro-Ro have the highest profitability. "We hold today in the dry cargo Novorossiysk only 15-16 percent of the volume of transshipment, but we work with the most cost-effective types of cargo. That is, if you compare, for example, revenue per ton of dry cargo segment, we have it is much higher than the competition, "- says Mr. Calf.

Serve Time

Implement deep transshipment of grain in southern Russia are a total of five terminals — three in Novorossiysk, one in Taman (the declared capacity of 3 million tons) and one in Tuapse (2.5 million tons). Tuapse terminal is not able to haul grain by road, there's only railway. The terminal in Taman, in contrast, can only haul grain by road, there is no railway. As a result, universal terminals that accept both road and rail transport, only three: NRT (part of NCSP) NKHP (majority owned by the state UGC) and CSC.

Meanwhile, the opportunity to take both types of transport is very important. In the first three to four months after the start of the harvest season (July 1) grain to ports deliver mainly cars — all within 500 km from the Black Sea ports so profitable. Once selected the entire crop from near the grain belt, the traders go to more remote regions, such as in the Voronezh and Orel region. Deliver goods from these regions should have the railway. "The terminals that have or railway or car, basically there are three to five months of the year, but it's different months — describes specific business Timothy Telyatnik. — We can accept shipments and the first half of the season and the second. Therefore, the volatility we are much lower than those of competitors. Although there are objective factors, which we can not influence, such as productivity. But the profitability of the grain business handling more than 75 percent of EBITDA, so you can afford to take risks. "

This high profitability due not only to high-risk, but also the limited supply of terminal capacity. "Now there are only five terminals in the south, which serve deep-grain exports — is very small. All of them are small, — says Alexander Bessarabia. — Each of these can be stored no more than 120,000 tons. This is nothing. Together, they rolled over 10-12 million tonnes a year — and while they have such tiny storage capabilities. "

Due to the fact that the capacity of the terminal is low, there is another factor that determines the competitive advantage for the port: the speed of handling and service trucks bringing grain. During the construction of CSC was done so that this rate has been as high as possible.

  • The President of the Civil Code "Case" Timothy Telyatnik: "We have only 15-16 percent by
volume of dry cargo transshipment in Novorossiysk, but we only work with the most cost-effective goods» 032_expert_27_1.jpg Photo: Victor Zazhigin
  • The President of the Civil Code "Case" Timothy Telyatnik: "We have only 15-16 percent by volume of dry cargo transshipment in Novorossiysk, but we only work with the most cost-effective goods» 032_expert_27_1.jpg Photo: Victor Zazhigin

The President of the Civil Code "Case" Timothy Telyatnik: "We have only 15-16 percent by volume of dry cargo transshipment in Novorossiysk, but we only work with the most cost-effective goods' Photo: Victor Zazhigin

"We built the latter and took into account the many mistakes that ponadelali others — says Timothy Telyatnik — our equipment is brand new, does not require the time and cost of maintaining a technically good condition."

For example, the terminal UGC — NKHP — was built in the years after the war to receive the imported grain, in the 1970s, it has been modernized, but since then it's been forty years. The prevention or repair of tape that goes from the silos, it takes a long time. In the new gallery KSK two modern tape and repair them quickly.

Increased twice as the ability to receive the grain and the new railway at five ways: now the train, all 60 cars placed at the port, which allows you to quickly unload it without interfering with other compounds.

Another important point, which allows you to "Cause" to keep high margins — the most efficient use of its territory, the same in the past marshland. "We need to use every inch — says Telyatnik. — We are now in the territory of the grain terminal betoniruem pad to take Ro-Ro, particularly cars. I hope that in September of this year we will have the first ship. "

The towers of containers

Unloading speed is important, not only for trains and cars, but also for merchant ships and ship owners are willing to pay extra for it. Actually, this is another goal of building a new railway.

Earlier containers coming into the port on ships were unloaded and stockpiled reach stackers. However, it is an older technology that requires a lot of space for storage is not involved. Reach Stacker must pass the container around the port area to move it requires huge space. To address this problem in the port technology has been applied RTG (Rubber Tyred Gantry Cranes) — this is a gantry crane on pneumatic wheels. Its main advantage — the speed and the ability to store up to six containers in height and seven in width. But RTG travels in a straight line, as if the virtual rails, with the help of GPS.

The old railway shared territory NUTEP into two parts, thereby preventing introduce RTG. This was only possible after the transfer of the railway to the new location and expansion of usable territory NUTEP.

"Due to the fact that we have expanded the territory NUTEP, it was possible to establish five four RTG cranes and crane Ship-to-Shore (STS), the speed of which is five times higher than with the Reach Stacker — says Mr. Calf. — This means that the ship can now be treated five times faster. And for the carrier's processing speed is very significant factor. After all freight vessel can reach up to 25 thousand dollars a day, and the line of principle, how much time the ship will stay at the dock. "

Investment in equipment wharfage serious. For example, one tap Ship-to-Shore is worth 8.5 million dollars, each mobile crane had cost $ 3.2 million, one RTG worth 1.9 million dollars. But as a result of introduction of new technologies in the port area NUTEP capacity increased from 200 thousand to 350 thousand TEUs. Grain terminal in two and a half years rebuilt. Ahead of revenue growth from Ro-Ro. As a result, from the start of an extensive investment program in 2011, the turnover of terminals has doubled, and financial performance — three times (see graphs). In 2012, the turnover of all terminals totaled 4.7 million tons, and capacity — 9,000,000 tons. It's a lot. For example, recently sold "Mechel" Vanino port can overload the 6 million tons per year.

"We have almost double the reserve. What we would like to implement here, in this area — we all did. Now we're just waiting for the grain and containers. And for the first five months of this year, we handled more than in all of 2010 "- Timothy Telyatnik happy.

In the first phase of investment went all net profits, dividends, shareholders "Cases" does not work — and it seems that some time will not be getting: not having time to finish the first of its investment, the group immediately announces a new — berth number 38.

Straight from the ocean

Deadweight commercial vehicles in recent years, actively growing. For example, 5 June 2013 the Korean shipyard went dry cargo capacity of 18 thousand containers. 400-meter giant, owned by Maersk, will be able to get up for unloading only 16 ports of the world. Russia's southern ports can not accept even modest by today's standards, container-five thousand meters. Now to unload an ocean liner, the international lines Maersk and MSC performed the operation TransShipment. The large vessels into the ports of the Mediterranean, Turkey, Romania and Ukraine, the containers are unloaded and then loaded on a ship again, but smaller capacity (feeders), which already carry the containers to Russian ports. As a result, the line pays double handling: first, parking, costs, fuel, the rate for the terminal to reboot, then download back to somewhere in the port of Istanbul, and then everything is the same, but in Russian.

"If we give the lines of the ability to go directly to Novorossiysk, it would be a fundamentally different economy — says Timothy Telyatnik. — Savings in the same container could be 500-600 dollars. Accordingly, the rates that we have given in Novorossiysk, would not be so important. Economies of scale for all lines would overlap. " That is why the "case" wants to build a deep-water dock — the same berth number 38, allows you to receive container ships, which are now in Novorossiysk just do not go. To date, the project has passed the stage of documentation. Berth capacity of 250 thousand TEUs will be built in two years. The total cost — 160-170 million dollars, of which 100 million will be invested directly into the dock, and 60 million — in the handling equipment in concreting platforms in runways and so on. The project will generate at least $ 50 million in revenue annually. Profitability of the port from the introduction of the new quay will increase at least through economies of scale. In winter 2014 "Business" expects to start construction work.

The new dock will be built entirely with private money — and it is a rare example in Russia, where the berths and educated territory is mainly owned by the government in the face of "Rosmorport" (including quay NUTEP and CSC, which the government hands over the "case" for rent) . "With all the working documents we turned to the Ministry of Transport of the State funded the construction of the berth number 38, as it corresponds to the concept master plan for development of the south-east of the port within the approved federal program. But there we were told that other priorities and the need to build a port of Taman. Therefore, we have not included FTP and offered to find other ways of funding. So we did, "- says Timothy Telyatnik.

Banks, approved the project, its economy and efficiency of the "Cases", has agreed to fund the construction of a new quay wall. "It turned out easier to build the object itself, rather than to attract funding from the state. In the latter case, we would not be able to control the cost of any project, any time of its construction. Once the state ha
s built a pier, it would donate it to us to rent based on the cost of construction. And if, for example, the estimate would have increased twice, the profitability of the project would simply disappear, "- says Mr. Calf.

With the port infrastructure in recent years at all was an interesting situation: in spite of the widespread belief that it sorely lacking, to the south, such as piers enough. In addition, there were private companies that are seeing the profitability of this business, willing to invest in port infrastructure. This is not only a "thing": the company "Petrolesport" (part of the Global Ports), FCT and the adjacent territories (part of the NCC), the terminal UCL-Holding his own expense completely revamped the entire infrastructure of ports in St. Petersburg. In the Baltic Sea with the Ust-Luga and the future terminal in Bronka already overcapacity for container handling. Public money has nothing to do here, they need to invest in other projects.

"If there is demand, it will give birth to offer capacity, — says Mr. Calf. — There was not enough of the same grain terminals? At private expense in the south built all the grain terminals: Taman, Tuapse, we Novorossiysk port. No deep-sea container berths for direct ocean service — that's it, and we will build. Of course, at some stage private owners may need assistance from the state, but not for the construction of berths, and, for example, to enhance the capacity of the railway on the approaches to the ports. "

Novorossiysk, Moscow

In the preparation of this article participated Jaroslav Maltsev

Scheme The port complex of the "thing" in the bay Tsemess

Figure 1 Doubling turnover in 3 years, "It" is ready to double again

Figure 2 Revenue "Cases" also has doubled in three years

Figure 3 After complete absorption in 2011 NUTEP EBITDA «Things" has increased many times

Figure 4 DeloPorts systematically implementing an investment program

Figure 5 Growth of container in 2012 slowed down

Chart 6 Handling of grain growing steadily

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