Source - SMW
Globaltrans Investment's adjusted revenue for the six months to the end of June was broadly unchanged year on year at RUB 20,613 million (-1% year on year) with the solid performance of the gondola car segment offset by weak results from the rail tank car operations and a decline in revenues from auxiliary services.

Globaltrans said efficient cost management effectively limited the rise in operating cash costs to 3% year on year, substantially below the increase in the group's business volumes and the rise in the regulated RZD tariffs.

Adjusted EBITDA was RUB7,648 million, down 9% year on year with adjusted EBITDA margin at 37%* (H1 2015: 40%).    

 Profit attributable to owners of the company increased 11% year on year to RUB 1,583 million benefiting from the positive contribution from the wholly owned gondola business.

Other highlights:

-      Strong balance sheet with Net Debt of RUB 17,106 million*- as of 30 June 2016. The Net Debt to Adjusted EBITDA ratio for the last twelve months ended 30 June 2016 was 1.1x* (1.0x as of the end of 2015).

-     Total finance costs down 26% year on year reflecting improvement in the weighted average effective interest rate to 11.7% as of 30 June 2016 as well as a decline in the Group's Total debt over the last eighteen months period.

Chief executive  Valery Shpakov said: "While the first half was marked by continuing challenging market conditions, the recovery in the bulk cargo segment, in which Globaltrans is very well positioned, enabled the Group to substantially boost its business volumes and outperform the market. The impressive growth delivered in this segment was possible thanks to a combination of the Group's large, modern fleet, quality of service and long-term partnerships with clients.

"However, the introduction of new pipeline capacities and a decline in overall refined products output negatively affected demand for rail transportation of oil products and oil, and Globaltrans was clearly not immune to this trend. The negative impact of this segment's decline can be seen in the Group`s overall performance for the reporting period.

"Against this backdrop, Globaltrans has nonetheless delivered respectable financial results for the first six months of the year. The Group's focus on efficient cost management bore fruit with cost inflation held in check.

"We were particularly pleased that the Group was able to report an increase in profit attributable to owners of the Company on the back of solid results from the gondola business, which is fully owned by the Group and therefore a key contributor to the overall performance. 

"The company generated strong cash flow from operations and, despite the increase in CAPEX for selected acquisitions of petrochemical tank containers and capital repairs, the level of Free Cash Flow remained solid. This enabled the Group to pay substantial dividends and maintain comfortable leverage.

"The second half of 2016 is likely to bring further challenges. Provided the macroeconomic picture remains sound, the Group expects a balanced gondola market alongside continued weak market conditions in the oil products and oil segment. 

"As always, maintaining comfortable leverage, focusing on efficient cost management, strengthening client relationships and supporting appropriate shareholder remuneration will remain the Group's top priorities."