STATE TRANSPORT LEASING COMPANY

Transcription

1 STATE TRANSPORT LEASING COMPANY NOVEMBER 2018 No1 IN OVERALL VOLUME OF NEW BUSINESS AND LEASING PORTFOLIO * No1 No1 No IN AVIATION TRANSPORT LEASING * IN RAILROAD TRANSPORT LEASING * IN WATER TRANSPORT LEASING * BN USD OF INVESTMENTS IN THE TRANSPORT INDUSTRY * according to RAEX research of the leasing market, 2017

2 BRIEF HISTORICAL OVERVIEW M 2018 Establishing a specialized leasing company on the basis of STLC, OJSC, in line with the instructions of V.V. Putin for purchasing domestic automotive and road construction machinery The Ministry of Transport of Russia is authorized to exercise shareholder rights Starting the implementation of the target leasing program with State participation Increasing the Company s capital by USD in order to support domestic producers under the program of anti-crisis measures of the Government of the Russian Federation Developing commercial leasing programs using borrowed funds of Russian banks STLC is among TOP-5 companies in the leasing market, taking the leading positions in the transport leasing segments * Implementing a noncommercial leasing program through reinvestment of lessees funds Active development of the railway equipment leasing Developing the leasing of regional aviation Assigning a long-term ВВ- credit rating by S&P At the end of 2012, the total amount of investments in noncommercial leasing programs exceeded USD * According to RAEX research of the leasing market STLC entered the Asian borrowed capital markets: in cooperation with ICBCL, it funded the delivery of five Airbus A321 to Aeroflot STLC is the largest AC supplier for regional aviation and entered the water transport leasing market Developing the operating leasing business line Launching a pilot program for leasing motor vehicles running on gas engine fuel Debut bond issue at the MICEX stock exchange (USD ) At the end of 2013, STLC is among TOP-3 companies in terms of the operating leasing volumes* ICBC opened a credit facility for USD 800 for funding deals with aircraft Start of the implementation of the energy efficient transport leasing program with state co-financing (Order of the Government of Russian Federation from r) At the end of the year, STLC is the leader in the segment of water transport leasing in terms of the new business volume* STLC is the leader in the segments of air transport leasing segment and that of operating leasing * The State made two contributions to the STLC'S authorized capital for a total of USD Initiated activities for the development of operating leasing of SSJ100 Further development of the partnership with the Chinese financial market financed the delivery of 3 Boeing ER units to Aeroflot ** Line initially opened by Gazprombank in December 2016; in March 2017, the creditors syndicate was joined by ICBC and RRDB, and in May 2017, Credit bank of Moscow, Banca Intesa, and Bank of China STLC successfully place the debut issue of 5-year Eurobonds for USD 500 among a wide range of international investors Increasing the STLC capital by USD of budget funds as part of supporting the leasing of Russian AC and development of ferry transport in the Far East CMB Financial Leasing Co provided a credit facility to fund the supply of seven new Airbus А aircraft to Aeroflot Assigning longterm international credit ratings: Ba2 by Moody s, BB- by Fitch. The rating assigned by S&P upgraded to BBwith a stable forecast STLC is the Russia s largest leasing company in terms of the leasing portfolio and new business volumes Attracting a syndicated credit line from Gazprombank, ICBC, RRDB, CBM, Banca Intesa and Bank of China for the amount of up to USD to fund the leasing of SSJ100** Increasing the STLC capital by USD as part of implementing projects to support the leasing of domestic AC and the development of the Vanino Kholmsk ferry crossing Placing the second issue of Eurobonds for the amount of USD 500 for 7 years The Fitch rating increased to BB with a positive forecast; S&P and Moody`s increased the long- term STLC rating forecast from stable to positive Awarding the А+(RU) rating by the ACRA agency The investments of STLC in Russia s transport industry exceeded USD 11.5 billion The volume of federal budget subsidies allocated to STLC in 2018 will reach USD SSJ100 aircraft leasing development program prolonged to the 3RD stage STLC began the implementation of the air park monitoring system Construction of the "Lavna" coal transshipment facility has been launched Subsidiaries were registered: GTLK Asia LTD in Hong Kong and GTLK Middle East in Dubai STLC delivered its 50-thousand freight car to lessees 3 Presentation of the STLC'S key development indicators

3 KEY DEVELOPMENT INDICATORS State Transport Leasing Company (STLC, the Company) is the Russia s largest leasing company The Russian Federation is the Company s sole shareholder (represented by the Ministry of Transport of the Russian Federation) The STLC authorized capital has been created by the Government of the Russian Federation in the form of monetary contributions for the implementation of state programs to support the domestic transport sector as of in the amount of USD 1.04 billion, expected size of the authorized capital as of USD 1.36 billion The total amount of the STLC'S investment in the Russian transport sector in Q 2018 was over USD 11.5 billion; the multiplier effect of budgetary investments, 1:9 STLC s total portfolio volume grew from USD 25.9 in 2009 to USD 13.6 billion as of The volume of new business for 9 months in 2018 equals USD 3.3 billion 13,615 STLC is a versatile leasing company which has a diversified and stable leasing portfolio The STLC'S clients and partners are the major Russian enterprises, state companies, and financial institutions The STLC'S credit rating is below Russia's sovereign credit rating by one notch 1 IN TERMS OF THE PORTFOLIO SIZE AND VOLUME OF NEW BUSINESS 100% IN THE FEDERAL OWNERSHIP STATE INVESTMENTS IN THE STLC'S HOLDING COMPANY, USD * F STLC'S INVESTMENT IN TRANSPORT SECTOR, USD billion* DYNAMICS OF THE STLC'S NEW BUSINESS AND LEASING PORTFOLIO* , , , ,342 2,052 5,198 2,394 8,157 3, М 2018 STLC'S LEASING PORTFOLIO STRUCTURE IN TERMS OF THE INVESTMENT AMOUNT, as of Sep 30, 2018** Other 3% Motor transport, road construction transport Water transport 4% Railway transport STLC CREDIT RATING 13% 40% 40% Air transport Q New business, USD Leasing portfolio, USD * According to the exchange rate of the ruble on (1 USD= RUB) AKPA BA2 BB- BB А+(RU) ** The investment amount under existing contracts reduced by the amount of compensation for contract value in received leasing payments 4 Presentation of the STLC'S key development indicators

4 KEY FINANCIAL INDICATORS, IFRS As of June 30th 2018, STLC s assets have increased by 24% and exceeded USD 6.4 billion (according to IFRS) STLC s assets have increased exponentially due to growth of the new leasing business In the first half of 2018 STLC showed positive net profit of USD 6.7 STLC meets key profitability targets set by the shareholder STLC maintains a consistently high level of capital adequacy Growth of equity capital significantly increases the borrowing potential of STLC and the Company's development opportunities STLC ASSETS, USD billion* H 2018 KEY PERFORMANCE INDICATORS (IFRS), USD (1H 2018)* REVENUE PROFIT FOR THE PERIOD 6.7 ROE 1,88% CAPITAL ADEQUACY (CAPITAL/ASSETS) 16% Net investment in leases Assets under operating lease Cash and cash equivalents Other assets * According to the exchange rate of the ruble on (1 USD= RUB) 5 Presentation of the STLC'S key development indicators

5 LEADING MARKET POSITIONS STLC is the largest leasing company in Russia in terms of the volume of new business ( market share 19%) and leasing portfolio (share 22%) following 9 months results of 2018 STLC is the leader in terms of the new business size in the segments of air, water and railway transport leasing STLC is the leading leasing company in Russia in the operational leasing segment TOP-10 RUSSIAN LEASING COMPANIES IN TERMS OF THEIR LEASING PORTFOLIO AMOUNT (as of September 30, 2018), USD billion* STLC Sberbank Leasing VTB Leasing VEB-leasing TransFin-M Gazprombank Leasing Alfa Leasing Europlan Siemens Finance Rosagroleasing TOP-10 RUSSIAN LEASING COMPANIES IN TERMS OF THE NEW BUSINESS SIZE (for 9 months of 2018), USD billion* 13.6 STLC Sberbank Leasing VTB Leasing Europlan VEB-leasing Gazprombank Leasing Alfa Leasing Baltic Leasing Siemens Finance RESO-Leasing SHARE IN THE NEW BUSINESS SIZE IN THE LEASING MARKET SEGMENTS** AIR TRANSPORT RAILWAY TRANSPORT WATER TRANSPORT STLC STLC 19% VEBleasing Other 3% STLC Other 4% 33% #1 28% Sberbank Leasing 22% #1 10% TransFin-M 83% #1 VEBleasing 16% 19% VTB 8% VTB Leasing Other 41% Leasing Goznak leasing 14% *According to the preliminary data of the research carried out by RAEX for 9 months of **According to the research carried out by RAEX for Presentation of the STLC'S key development indicators

6 SUSTAINABLE FUNDING STLC has successful experience attracting funding from international and Russian financial institutions. In 2017 a syndicated loan was attracted from Gazprombank, ICBC, RRDB, CBM, Banca Intesa and Bank of China worth USD in order to finance activities for development of SSJ100 operational leasing An active issuer in the international and local markets: - in July 2016 and May 2017, STLC successfully placed the Eurobond issues for the total amount of USD 1 billion; - there are 19 bond issues and exchange bonds worth RUB 112 billion and USD 1.32 billion Financing of the most capital-intensive leasing transactions in the aviation segment are carried out in conjunction with Chinese credit organizations. Around USD 1 billion has been attracted from Industrial and Commercial Bank of China (ICBC) and China Merchants Group WELL-BALANCED FUNDING STRUCTURE* 1H 2018, % WELL-BALANCED LOAN STRUCTURE** BY MATURITY 1H 2018, % WELL-BALANCED CURRENCY STRUCTURE 1H 2018, % Other liabilities 3% 48% Issued bonds Less than 1 year 4% From 1 to 3 years 4% Borrowed funds** 35% 65% 4% Finance leasing liabilities From 3 to 5 years 20% Leasing portfolio *** RUB USD 37% 63% Capital 15% STLC IS THE ISSUER OF THE YEAR ACCORDING TO CBONDS AWARDS % Loans received Over 7 years 28% From 5 to 7 years 44% * According to IFRS ** The amount of obtained loans, bonds issued and finance lease obligations according to IFRS *** The amount of net investments in financial lease (before impairment) and value of assets leased out under operating lease according to IFRS 7 Presentation of the STLC'S key development indicators

7 THE STLC'S IMPORTANCE FOR THE STATE STRONG FINANCIAL SUPPORT THE STATE IS THE 100% SHAREHOLDER The state maintains the Company s high level of capital adequacy In , the Government of the Russian Federation contributed USD 1.04 billion* in the Company s capital The Russian Federation is the Company s sole shareholder (represented by the Ministry of Transport of the Russian Federation) In 2018, it plans to make an additional contribution to the STLC'S capital as part of activities for leasing development of domestic aircraft and water transport worth USD * ACTIVE PARTICIPATION IN THE COMPANY MANAGEMENT STLC s Board of Directors is led by the Deputy Chairman of the Government of the Russian Federation M. A. Akimov, (from August 30th, 2018) The Company s Board includes representatives of two core ministries: the Ministry of Transport of the Russian Federation and the Ministry of Industry and Trade of the Russian Federation The State approves the medium-term strategy of the Company ACTIVE IMPLEMENTATION OF THE STATE DEVELOPMENT PROGRAMS Since 2009, STLC has actively implemented the programs of the Government of the Russian Federation The programs are implemented in three main areas: Leasing program with state support Projects dedicated to the development of transport engineering Projects to attract extrabudgetary investment in the transport sector 8 * According to the exchange rate of the ruble on (1 USD= RUB) Presentation of the STLC'S key development indicators

8 IMPLEMENTATION OF STATE SUPPORTED LEASING PROGRAMS THE VOLUME OF STATE CO-FINANCING OF STLC S LEASING PROGRAMS, USD * USD Domestic automobile and road construction vehicles leasing development USD USD 74.7 Energy efficient transport noncommercial leasing program State co-financing for leasing programs with prolongation State co-financing for other leasing programs USD 61 USD 57.9 USD 15.2 USD ,045,2 Domestic aircraft SSJ100 leasing development program USD Domestic helicopter leasing development program USD 30.5 L-410 aircraft leasing development program USD ,360, ,045,2 USD USD 76.2 USD 89.9 Domestic dry cargo and highspeed passenger ships leasing development project VOLUME OF INVESTMENTS* AND PROCUREMENT OF EQUIPMENT UNDER STLC S IMPLEMENTED LEASING PROGRAMS WITH STATE CO-FINANCING PROCUREMENT UNDER THE PROGRAM 1 SSJ100 leasing development: 44 units 2 Helicopter leasing development: 110 units 3 Leasing of road constr., street cleaning and other machinery: 7,6 thousand units 4 Leasing of dry cargo and pass. vessels: 13 units 5 Leasing of energy efficient transport: 853 units 6 Ferry leasing: 2 units 7 L-410 leasing development: 14 units Federal budget investments in the program, % PROGRAM INVESTMENT STRUCTURE 49% 51% 42% 58% 34% 66% 50% 50% 43% 57% 55% 45% 53% 47% USD 1,369,1 ** USD ** USD USD ** USD ** USD USD 86.9 ** Extrabudgetary investments, % STLC s authorized capital at the beginning of the year * According to the exchange rate of the ruble on (1 USD= RUB) Vanino Kholmsk ferry crossing development ** The total planned volume of investments into the program project 9 Presentation of the STLC'S key development indicators

9 LEASING PORTFOLIO STRUCTURE FINANCIAL LEASE DIVERSIFIED PORTFOLIO STLC operates in more than 7 segments of leasing (railway, water, air, passenger motor transport, road construction machinery, etc.) The share in the portfolio are well-balanced by areas HIGH VALUE AND COLLATERAL QUALITY Ratio of collateral value to net investment in leases is near 100% OPTIMIZATION OF THE RAILWAY LEASING PORTFOLIO Active restructuring of existing contracts and transfer to operating lease with writing off the value to the market one LONG-TERM 51% 49% OPERATING LEASE 94% OF PORTFOLIO** IS AIRCRAFT LEASING Long-term operating lease is the main method of funding in the global aviation industry LONG-TERM CONTRACTS The average terms of contracts for operating lease are about 10 years INTERNATIONAL RISK MANAGEMENT STANDARDS Creation of reserves for the future maintenance of aircraft significantly reduces operational risks STRONG CLIENT BASE 100% H CHANGE IN THE LEASING PORTFOLIO STRUCTURE* BY LEASING TYPES 42% 80% 20% 67% 33% Financial lease Operating lease 35% 65% 23% 14% 6% 4% 25% 40% 60% 54% 51% 42% 30% 2% 4% 5% % 55% 49% 51% LEASING PORTFOLIO DIVERSIFICATION* IN THE KEY SEGMENTS 49% 51% 10% 8% 10% 52% 51% 51% 27% 33% 31% 11% 8% 8% H 2018 Note: Figures cannot be summed up correctly due to rounding * Based on the IFRS amounts of net investment in leases (before provisions) and assets under operating lease ** Based on the IFRS amounts of assets under operating lease Water transport Air transport Railway transport Other 10 Presentation of the STLC'S key development indicators

10 AIRCRAFT LEASING STLC IS THE LEADER IN THE RUSSIAN SEGMENT OF AIRCRAFT LEASING As of , STLC s portfolio included 191 aircraft of different type As part of the STLC s capital increase USD *, 62 aircrafts will be added to the portfolio SSJ100 LEASING DEVELOPMENT Since 2015, STLC has implemented the project to promote the sales of SSJ100 aircraft through the operating leasing. All 36 SSJ100 aircraft units have been leased out According to a decision by the Russian Government (government decree 1171 from ) STLC will receive a subsidy worth USD * in order to co-finance the purchase of 8 SSJ100 units in for further leasing to airlines SUPPORT OF THE DOMESTIC AIRCRAFT CONSTRUCTION AND SMALL AIRCRAFT STLC participates in the project for localizing the manufacture of Let L-410: 5 aircraft have been transferred to Russian regional airline companies In , STLC was provided with additional funds of USD 30.5 * from budgetary funds to purchase and leasing out of 5 L-410 aircraft units in 2017 and 5 units in 2018 According to a decision by the Russian Government (government decree 982 from ) STLC will redirect authorized capital funds in the amount of USD 15.2, for the purchase of 4 L-410 units in 2019 DOMESTIC HELICOPTER LEASING DEVELOPMENT STLC is the largest customer of domestically-produced helicopters for the sanitary aviation. In STLC received a contribution to the authorized capital worth USD * of budget funds for purchasing and leasing 60 units of domestic helicopters (including 42 MI-8 helicopters and 18 Ansat helicopters) equipped with medical modules. As of September 30th, 2018, STLC delivered 48 units to lessees. KEY CLIENTS: STRUCTURE OF THE STLC'S AIRCRAFT PORTFOLIO, units Airbus**: 42 units Boeing***: 19 units CRJ200: 2 units AS350 B3: 1 units In accordance with the decision by the Russian Government (government 750 decree 916 from , government decree 982 from ): Let L410: - STLC will receive a subsidy worth USD 76.2 * in order to co-finance 18 units the acquisition of 31 helicopters in for further leasing to Russian airlines Mi-8: 83 units - STLC will redirect funds of the authorized capital in the amount of USD Ansat: 29 units 45.7 for the purchase of 19 domestic helicopters in Robinson: *According to the exchange rate of the ruble on (1 USD= RUB) 1 unit М 2018 ** Airbus A321, A320, A319, A ***B , B , B , B , B ER Presentation of the STLC'S key development indicators SSJ100: 44 units L410: 14 units STLC'S INVESTMENT IN LEASING OF CIVIL AIRCRAFT, USD * 1,334 2,538 3,712 4,371

11 RAILWAY TRANSPORT LEASING STLC IS THE LEADER IN THE RUSSIAN SEGMENT OF RAILWAY TRANSPORT LEASING As of September 30, 2018, STLC s freight car fleet has 75 * thousand units, which is 7% of the total fleet of freight cars in Russia KEY PARTNERS: DYNAMICS OF GROWTH OF THE STLC'S CAR FLEET, units 74, 851 STLC is the leader in terms of the fleet size of innovative cars (the total amount of innovative cars leased out is 24.2 thousand units) RENOVATION OF THE COMMUTER ROLLING STOCK Leased to Central Exurban Passenger Company 30 units eleven-car EP2D electric trains made by DMZ, OJSC A deal for the leasing out of 8 units of new locomotivehauled passenger cars (model ) produced by JSC Tver Carriage Works, was concluded with "Sverdlovsk suburban company" JSC, 6 of them are already in operation. 2 carriages equipped with lifting devices for disabled passengers and accompanying personnel, will be delivered in December 2018 A deal was concluded on the leasing out of 5 fourwagon EP3D electric trains, produced by Demikhovo Machinebuilding Plant, to "Volga-Vyatka suburban passenger company". The electric trains will be used within the Nizhny Novgorod region, the control wagons are equipped with devices for disabled passengers *Taking the contracted cars into account (as of September 30, 2018, 50 thousand cars were delivered to lessees) STLC'S CAR FLEET STRUCTURE, thous. units, % Innovative gondola cars 18 25% Gondola cars 38 50% 75 thous. units 2 3% 3 4% 6 8% 8 10% Other Tank cars Hoppers Flatcars 5,420 9,661 16,626 18,543 18,562 30,303 44, М Presentation of the STLC'S key development indicators

12 WATER TRANSPORT LEASING STLC IS THE LEADER IN THE RUSSIAN SEGMENT OF WATER TRANSPORT LEASING STLC is the leading leasing company in terms of the volume of new business and leasing portfolio in the segment* As at September 30, 2018, the Company s fleet included 80 units of various types of ships KEY PARTNERS: STLC'S INVESTMENT IN WATER TRANSPORT LEASING, USD ** 1,465,4 DEVELOPMENT OF THE DOMESTIC SHIPBUILDING INDUSTRY AND IMPORT SUBSTITUTION PROCESS STIMULATION In , STLC placed orders for the construction of 55 vessels in domestic shipyards, 32 units of which were already transferred to lessees The construction of ships is carried out at shipyards of Krasnoye Sormovo, OJSC, Nevsky Shipyard, LLC, Nefteflot, CJSC, and Okskaya Shipyard, OJSC STLC implements the program of the development of the Vanino-Kholmsk ferry crossing to connect the Island of Sakhalin with the mainland Russia. In 2017, it launched the construction of 2 ferries at the Amur Shipbuilding Plant to replace obsolete ships In 2018, it is planned to provide a subsidy in the amount of USD 89.9 ** for the purchase of 13 vessels (11 units of river-sea class dry cargo of the RSD59 project and 2 units of high-speed hydrofoil ships Kometa 120M) for further delivery under leasing agreements *according to RAEX as of December 31, 2017 **According to the exchange rate of the ruble on (1 USD= RUB) Oil tankers 32 40% STLC'S FLEET STRUCTURE, units (%) Dry cargo ships 32 40% 80 units 4 5% 4 5% 8 10% Other Cargo and passenger ferries Tow boats М Presentation of the STLC'S key development indicators

13 ENERGY EFFICIENT TRANSPORT LEASING ORDER OF THE GOVERNMENT OF THE RUSSIAN FEDERATION NO. 767-R DATED MAY 13, 2013 ON REGULATION OF RELATIONS IN THE USE OF GAS ENGINE FUEL, INCLUDING NATURAL GAS, AS ENGINE FUEL As part of the Order, STLC has launched a pilot program of noncommercial leasing for supply of passenger motor vehicles running on gas engine fuel STLC uses federal budget investments and return funds from lessees under non-commercial leasing programs for the supply of passenger vehicles on gas-engine fuel and electric transport on preferential terms STLC IS A LEADER IN LEASING OF VEHICLES RUNNING ON GAS ENGINE FUEL, AND GROUND ELECTRIC VEHICLES STLC plans to expand its participation in the implementation of noncommercial leasing programs in Russian regions with a developed or developing gas-engine fuel infrastructure. The Company already carries out supplies to the following constituent entities of the Russian Federation: Tula Region Chelyabinsk Region Sverdlovsk Region Samara Region Omsk Region Yamalo-Nenets Autonomous Area Republic of Komi Republic of Mordovia Saint Petersburg and Leningrad Region Volgograd Region Republic of Crimea and Sevastopol* *Order of the Russian Government from December 30th, r **According to the exchange rate of the ruble on (1 USD= RUB) FEDERAL BUDGET INVESTMENTS IN THE AUTHORIZED CAPITAL OF STLC IN 2015 STLC'S INVESTMENT IN THE ENERGY EFFICIENT MACHINERY MARKET IN Q 2018 STLC'S PROCUREMENT OF ENERGY EFFICIENT MACHINERY IN Q MILLION USD** 200 MILLION USD** 1.7 THOUS. UNITS 14 Presentation of the STLC'S key development indicators

14 INTERNATIONAL LEASING DEVELOPMENT FOREIGN LEASING PLATFORM CREATED (BASED ON GTLK EUROPE DAC AND GTLK ASIA LTD) TO DEVELOP NON- RESOURCE EXPORT - GTLK GLOBAL BUSINESS GTLK Europe DAC STLC s subsidiary registered in Ireland in 2012 In 2018, in order to diversify the geography of borrowing and to facilitate the attraction of financing in the Asian region following companies were registered: GTLK Asia LTD in Hong Kong and GTLK Middle East in Dubai Key priorities of GTLK GLOBAL BUSINESS: - Development of international leasing of aircraft and water transport - Optimization of the cost of extrabudgetary investments attracted by STLC for the development of the transport industry - Promoting the export of domestic equipment GTLK GLOBAL BUSINESS successfully attracts financing in international debt capital markets as an independent borrower under the guarantee of STLC KEY CUSTOMERS: GTLK GLOBAL BUSINESS PORTFOLIO ALLOCATION, units AIR FLEET 42 units 63 units 2 units 19 units STLC LEASING INFRASTRUCTURE: RUSSIA AND WORLD Exercise of shareholder rights on behalf of the Russian Federation 100% FLEET OF SHIPS Dry cargo vessels 13 units Ministry of Transport of the Russian Federation STLC (Russia) 100% 16 units 1 unit Oil tanker GTLK Asia LTD (Hong Kong) GTLK Europe DAC (Ireland) 100% GTLK Middle East (Dubai) GTLK GLOBAL BUSINESS Air transport leasing Water transport leasing 2 units Maritime cranes 15 International funding Presentation of the STLC'S key development indicators

15 TRANSPORT INFRASTRUCTURE DEVELOPMENT. CONSTRUCTION OF COAL TRANSSHIPMENT COMPLEX LAVNA The Lavna coal transshipment complex in the Murmansk sea port is located in the Murmansk Region, on the west bank of the southern branch of the Kola Bay, in the mouth of the Lavna River, near the village of Mezhdurechye The project involves the construction of a modern port complex for coal transshipment using the newest equipment, with a capacity of 18 mln tons per year, and the construction of access railway tracks for private use from the Lavna Station to the port complex with a length of 2.3 km The project is implemented in accordance with the State program of the Russian Federation "Development of transport system" included in the Transport strategy and the Strategy for development of railway transport of the Russian Federation for the period up to 2030 Implementation of the Project by 2020 is attributed to the existence of Orders of the President of the Russian Federation V. Putin No. PR-1881 of (to take comprehensive measures for the implementation of the Project in time) EFFECT FOR TRANSPORT INFRASTRUCTURE The increase in the volume of exports of energy coals by construction of new transshipment facilities In the territory of the Russian Federation Diverting cargo flows from the Baltic to Russian ports Entering new sales markets due to increase in the carrying capacity of ships CURRENT IMPLEMENTATION STATUS: Construction of the "Lavna" coal transshipment facility has been launched The project is implemented on the basis of public-private partnership and use of concessions 16 Presentation of the STLC'S key development indicators

16 SUCCESSFUL PLACEMENT OF THE EUROBONDS The main investors included the largest institutional investors from Great Britain, Russia and Europe Both issues of Eurobonds were in great demand the order books made up USD billion (oversubscribed 4.5 5x) received from large international institutional investors Twice, STLC reduced the benchmarks for the coupon rate for each issue, having closed the book at the lower limit of the final range: % per annum issue % per annum issue 2 GEOGRAPHICAL SPREAD OF INVESTORS 3% 6% 10% 9% 5% 13% 16% 17% 36% 18% 20% 6% 23% 38% 24% 56% Placement of Eurobonds of STLC (issue 2) is the first since year issue of Eurobonds from the financial sector of the Russian Federation The issue of Eurobonds of STLC made it possible to extend the debt portfolio and create the conditions for subsequent borrowings at the rates convenient for STLC Asia USA (offshore) Russia Switzerland Сontinental Europe Great Britain TYPE OF INVESTORS 10% 12% 30% 48% Hedge funds and insurance companies Private banks Banks Management companies and funds PARAMETERS ISSUE 1 ISSUE 2 Issuer GTLK Europe DAC * Guarantor * Till September, GTLK Europe Limited STLC Issue volume USD 500 USD 500 Circulation period 5 years 7 years Coupon rate 5.95% per annum 5.125% per annum Placement price Circulation commencement date Format Listing Issue ratings Lead managers 100% of the nominal July 19, 2016 May 31, 2017 Ba3 (Moody s) / BB- (Fitch) J.P. Morgan, Renaissance Capital, UBS, VTB Capital Regulation S Irish Stock Exchange Ba3 (Moody s) / BB (Fitch) J.P. Morgan, Renaissance Capital, Societe Generale, VTB Capital, Gazprombank, Alfa Capital Markets 17 Presentation of the STLC'S key development indicators

17 SUSTAINABLE BALANCE STRUCTURE STLC s assets increased exponentially due to growth in volume of the new business The company effectively diversified the structure of its obligations, attracting bond loans in rubles and foreign currency STLC maintains a high level of capital adequacy due to additional contributions to its capital and continuous improvement of its operational efficiency CAPITAL*, USD ** ASSETS*, USD billion** 46.5%*** % 18% 4% 4% % 38% % 21% 4% 11% % 45% 38% 12% 3% 0.8 7% 15% 16% 30% 10% 74% 65% 57% 23% 31% 40% 40% H 2018 LIABILITIES*, USD billion** 5.4 3% %*** 5% 2.7 3% 56% % 1% 29% 49% 1.3 6% 5% 1.1 1% 29% 3% 24% 18% 14% % 10% 2% 98% 59% 61% 41% 30% 32% 35% H 2018 Capital/Assets, % 20% 13% 11% 25% 25% 19% 16% 20% Including subsidies worth USD in 4Q 2018 In 2017, USD ** of contributions to the capital In 2016, USD 189 ** of contributions to the capital In 2015, USD 532 ** of contributions to the capital ,001,7 1,317, H 2018 F2018**** Net investment in leases Cash and cash equivalents Loans received Bonds issued Assets under operating lease Other assets Financial leasing liabilities Other liabilities *According to IFRS **According to exchange rate of the ruble on (1 USD= RUB) *** Average annual growth rate ****Forecast value for Note: Figures cannot be summed up correctly due to rounding Source: according to IFRS 18 Presentation of the STLC'S key development indicators

18 REVENUE AND MARGINS Significant revenue growth, primarily due to the development of the operating leasing segment STLC maintains a high operational efficiency while maintaining the ratio of operating expenses to total assets at less than 1% in the first half of 2018 REVENUE, USD * % % 50% OPERATIONAL EFFICIENCY OPERATIONAL COSTS / ASSETS**, % 5% % 10% 52% 59% 1.4% % 22% 43% 1.1% 1.0% % 96% % 3% 92% 75% 47% 35% 45% 44% 0.7% 0.7% 0.6% H H 2018 Finance lease income Operating lease income Other interest income Note: Figures cannot be summed up correctly due to rounding *According to exchange rate of the ruble on (1 USD= RUB) ** The ratio of administrative costs and average annual assets (according to IFRS) Source: according to IFRS 19 Presentation of the STLC'S key development indicators

19 IFRS FINANCIAL STATEMENTS BALANCE Balance [USD ]* H 2018 Assets ,253,5 1,480,2 2,823,6 3,538,6 5,192,6 6,443,2 Cash and cash equivalents Investments in securities Net investment in leases ,080,8 2,072,2 2,566,8 Assets under operating lease ,279,4 1,343,8 2,048,7 2,478,0 Equipment purchased for leasing purposes Advances to equipment leasing providers Investment property Fixed assets and intangible assets VAT recoverable Current tax assets Deferred tax assets Other assets Equity capital ,001,0 Share capital ,046,5 1,046,5 Undestributed profits Liabilities ,096,7 1,320,8 2,131,1 2,656,1 4,197,7 5,442,2 Loans received ,337,5 1,912,0 Issued bonds ,313,3 2,394,4 3,070,6 Liabilities under financial leasing Accounts payable to equipment suppliers Advances received Other liabilities Current tax liabilities Deferred tax liabilities Total equity capital and liabilities ,253,5 1,480,2 2,823,6 3,538,6 5,192,6 6,443,2 *According to exchange rate of the ruble on (1 USD= RUB) 20 Presentation of the STLC'S key development indicators

20 IFRS FINANCIAL STATEMENTS STATEMENT ON COMPREHENSIVE INCOME Statement of Comprehensive Income [USD ]* H 2018 Interest income from leasing operations Other interest income Income from operating leasing Operating leasing depreciation Interest expenses Net interest income Loss from interest-bearing assets Net interest income after impairment Administrative costs Other operating income and costs Income less costs from revaluation of foreign currency Loss on impairment of non-interest assets Profit (loss) before taxation Tax on income Total aggregate income KPI [key performance indicators] H 2018 ROE (Net Profit (Comprehensive Income) / Annual Average Capital) 0.93% 1.25% 2.56% 0.26% 0.17% -6.42% 1.88% Equity / Assets 19.69% 12.51% 10.77% 24.53% 24.94% 19.16% 15.54% *According to exchange rate of the ruble on (1 USD= RUB) 21 Presentation of the STLC'S key development indicators

21 STLC'S PARTNERS STLC cooperates on an ongoing basis more than 70 manufacturers and dealers of machinery and constantly expands the range of its partners: STLC actively cooperates with the relevant associations and state corporations: And maintains strong partnership relations with leading financial institutions: 22 Presentation of the STLC'S key development indicators

22 STATE TRANSPORT LEASING COMPANY 73 Respublika St., Suite #100, Salekhard, Yamalo-Nenets Autonomous Area, Separate business unit in the city of Moscow: 31a Leningradsky Avenue, bldg #1, Moscow, (495)