Consolidated revenues of FESCO Transport Group last

grew by 16%

OAO "Far Eastern Shipping Company" ("FESCO") publishes its audited consolidated financial statements under IFRS for the year 2012.

Key figures of the group:

  • Consolidated revenue increased by 16% compared to 2011, reaching 197 million worth USD 1
  • Adjusted earnings reporting period remained at a level comparable with the previous year, and amounted to USD 1,157 million: the
  • The accelerated growth of revenue and linear rail and logistics divisions were offset by lower sales in the marine division (adjusted for the disposal of 21 vessels in 2012)
  • Adjusted EBITDA1in 2012 increased by 14% to USD 279 million and Adjusted EBITDA margin was 24% (compared to 21% a year earlier)
  • The capital investments declined by 54% compared with the previous year to USD 66 million mainly due to the reduction in capital expenditure in the rail division. Working capital decreased by 8% compared to the previous year and amounted to USD 69 million
  • The amount of cash on the balance sheet as at 31 December 2012 amounted to USD 232 million, providing a significant amount of liquidity
  • Net debt increased to USD 688 million2As of December 31, 2012 as a result of attracting loans under the financing deal mediated by acquisition of a controlling stake in FESCO Group "The amount», TPG and the GHP Group.
  • 1Adjusted revenue and EBITDA reflect the consolidation of the CPV so if it had occurred January 1, 2011, and in 2012 did not take into account the results of the 21 retired ship. In addition, the figures do not take into account the results of one-off transactions, as well as the cost of insurance payments

    2Total debt, excluding guarantees for USD 400 million provided by the subsidiaries of FESCO’s main shareholder of the Company as part of the financing deal to buy FESCO, including repo loan secured by shares of JSC "TransContainer"

    Key performance indicators divisions:

    • Adjusted revenue port division amounted to USD 206 million (a decrease of 6% compared to the previous year) and an adjusted EBITDA of USD 98 million (up 17%), resulting in an EBITDA margin of 48%
    • EBITDA growth of port division due to an increase in transshipment of containerized cargo, as well as synergies from the merger, "the Vladivostok Commercial Sea Port" ("CPV") and "Vladivostok Container Terminal" ("CGT") after the consolidation of the controlling interest "CPV" in March 2012
  • Revenue railway division was USD 347 million (up 13%) and EBITDA of USD 167 million (up 25%). EBITDA margin of 48%
    • EBITDA growth driven by higher freight containers block trains, as well as higher marginal return on the wagon-day
    • Revenue linear and logistic division grew by 10% to USD 623 million, EBITDA fell by 16% to USD 43 million, an EBITDA margin of 7%
      • On the importance of EBITDA influenced opposite trends: the growth of traffic on the one hand and the increase in fuel costs and fees for stevedoring services on the other.
      • In 2012, a group of FESCO activity reduces marine operations division. During the year, 21 vessels have been sold. Adjusted revenue marine division amounted to USD 73 million (down 54%), while the adjusted figure was negative and amounted to USD 3,000,000 minus
        • As a result, a significant reduction in the size of its fleet business model and focus of the division shifted from ship owners and fleet management in the direction of providing linear and logistic battalion "FESCO".
        • Yury Gilts, President of "FESCO": "It was another successful year for the company. We continued to implement its strategy for the development of the container business, one of the most promising segments of the Russian transport market, while strengthening our competitive position in the niche markets of non-container shipments. We completed the consolidation of "CPV" and strengthened the integration of business, that on the basis of our assets to provide customers with integrated solutions and unique transportation and logistics products geared to the requirements of the customer. The marine division of the group has undergone significant changes, re-directing the activities of ship owners and fleet management to work towards ensuring linear and logistic division. We are confident that these changes will create a solid foundation for further growth. Positive financial results will be the impetus for further development and would "FESCO" look for the next financial year with confidence and enthusiasm. "

          More

          Full text of the consolidated financial statements for 2012 is available online at:http://www.fesco.ru/investor/documents/reports/

          About FESCO Transport Group

          FESCO — one of Russia’s largest owners and operators of port infrastructure with integrated rail and logistics business mainly focused on the implementation of the intermodal transportation of containerized cargo. The presence of own port, rail and shipingovyh assets enables the Group to control all stages of the intermodal transport chain and deliver cargo from "tear up the door." Most of the Group’s operations are concentrated in the Far East of Russia, which allows FESCO to receive benefits from the participation in the rapidly growing volume of trade between Russia and the countries of Asia.

          FESCO group belongs to JSC "Vladivostok Commercial Sea Port", the annual throughput capacity of 3.9 million tons of general cargo and petroleum products, 150 thousand units of cars and vehicles and more than 600 thousand TEU container cargo (including additional investments in 2013 ). FESCO is among the 10 largest Russian private rail operators, carrying out transportation under the "Transgarant" (100% subsidiary of FESCO) and "Russian Troika" (50% joint venture with OAO "Russian Railways"). In the management of "Transgarant" is of the order of 16 200 pieces of rolling stock (wagons are 12 different species), and the "Russian Troika" operates about 1,570 fitting platforms. In the property and leasing at FESCO, there are over 35,000 containers with a capacity of more than 56,000 TEU. Group owned 26 ships used primarily linear and logistic division.

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