Research and production corporation «United Wagon Company» Financial Results for 2016

Transcription

1 Research and production corporation «United Wagon Company» Financial Results for April 2017

2 UWC's financial results: Revenue 1 2 Revenue The revenue growth in 2016 was due to: +32% YOY Higher volumes of production and sales Increase in the average size of the company s own fleet Growing railcar prices and lease rates 17.1 In the reporting year, the share of other goods and services in the revenue grew due to the income generated by JSC TAP Titran-Express, UWC s own railcar maintenance and repair facility, acquired in 2016 Consolidated revenue reconciliation Revenue breakdown by segment , % 1% 12% 11% 88% 88% Production Distribution Other Adjustments UWC Revenue and eliminations Production Distribution Other Source: Company s IFRS statements * Segments: Production - sales of railcars and castings; Sales - operating lease; Other - service maintenance, etc. Notes: (1) 2015 and 2016 revenue excludes the performance of Vostok1520 LLC sold in November 2016

3 UWC's financial results: % YOY 13.7 The growth in the reporting year was due to higher railcar sales and lease revenues The margin increased owing to a higher operational efficiency of the production and a growing profit from the lease business % % 28.2% The major negative impact on the margin and the profitability is caused by the growing payroll of production personnel margin reconciliation Factor analysis of margin As % of revenue % 47.4% 7.4% 10.6% 6.5% 19.2% 12.3% 7.9% 28.2% 4.2% Production Distribution Other Adjustments and eliminations UWC margin Other SG&A Source: Company's IFRS statements Personnel costs Raw materials Notes: (1) 2015 and 2016 revenue excludes the performance of Vostok1520 LLC sold in November 2016

4 UWC's financial results: Net income 4 Net income 1 In the reporting period UWC s profit was generated by the consolidated growth currency exchange gains the profit received from discontinued operations of Vostok1520 LLC -9.7 The major negative impact on the Company's profit is produced by loan and bond interest expenses, and non-monetary amortisation expenses Net income reconciliation Factor analysis of net income D&A and PPE impairment Fin. Costs FOREX gain Income tax revenue Income from discontinued operations Net income Net loss 2015 D&A and PPE impairment Fin. costs FOREX Income tax Discon-d Net income operations 2016 Source: Company's IFRS statements Notes: (1) Including the profit from discontinued operations

5 % 35% 30% 25% 20% 15% 10% 5% 0% Financial results of Production 5 Revenue The Production revenue increased due to: +35% YOY 43.4 A higher production volume of railcars in the reporting year (an increase of 28% to 15.9 thousand units) 32.1 Higher railcar selling prices 23.2 The growth of the margin and the revenue was due to the following factors: +117% YOY 9.0 UWC increased the capacity and output of its facilities % Measures were taken to reduce the cost of production % 5.6% The margin was negatively influenced by the growth of the production personnel payroll caused by the enlargement of the industrial site staff size and indexation of their wages margin Source: The Company's IFRS statements

6 Financial results of Distribution 6 Revenue % YOY 5.2 The revenue in the Sales (operating lease services) grew due to: Increases in the average size of UWC s own fleet Increases in the average railcar lease rate The margin and revenue grew due to: +53% YOY 4.3 Higher lease rates and growing difference between the cost of operation and railcar profitability % % 81.1% Provision recovery of RUB 172 mn in 2016 to cover doubtful debts accrued in 2015 margin Source: The Company's IFRS statements

7 UWC s capital expenditures 1 7 Capital expenditures structure and changes 2, Most of the 2016 expenses were incurred in connection with the implementation of strategies aiming to expand the product assortment, and achieve a higher capacity, flexibility and operating efficiency of the production process The share of costs in foreign currency is some 50%, with most of the costs related to purchases of product, plant and equipment abroad. The remaining 50% includes ruble-denominated costs of construction and installation Operational efficiency Product portfolio expansion Other projects Source: The Company's management statements Notes: (1) Excluding investments for acquisition of railcars in the Sales; (2) The investment expenditures are shown without VAT; (3) Excluding asset acquisition

8 UWC s loan portfolio 8 Debt portfolio structure Debt optimisation By lender Otkritie Alfa Bank By segment In H1 2016, the bond holders resolved to shift the maturity date of Series 01 bonds issued by UWC Finance for a total amount of RUB 15 bn from 2016 to % 2% 1% 2% RUB 102 bln 16% 19% 30% VEB-EDB Gazprombank Credit Bank of Moscow Rosnano Other Bonds 29% 7% Production Other RUB 102 bln 32% 31% Distribution Bonds In October 2016, Alfa-Bank disbursed to UWC a loan used by the Company to repay its RUB 19.2 bln debt to Sberbank and Otkritie Bank. The new loan has a better repayment schedule: most payments are due in 2022 and While the Company continues collaborating with its current lenders, it is developing partnerships with other large Russian and international banks. Principal repayment schedule 1 Net debt/, x Debt load decrease E 2018E E Bonds repayment Loans repayment Source: Company s management accounts Note: (1) As at 31/03/2017. Excluding working capital loans

9 Contacts 9 Investor Relations +7 (499) IR@uniwagon.com Research and Production Corporation United Wagon Company 7/11 bld. 1, Novokuznetskaya st., Moscow, Russia, Office: +7 (499) Fax.: +7 (985)