Consolidated Financial Results of UWC for 1H 2016
PJSC “Research and production corporation “United Wagon Company” (“UWC” or the Holding) (MOEX: UWGN), the leader in innovative railcar building in the 1520 mm track gauge area, reports its IFRS consolidated financial results for the 1H 2016.
Key indicators over the reporting period:
- UWC’s consolidated revenue grew 38% to RUB 23.5 billion compared to the same period last year
- The Operation earned 211% more of revenue hitting RUB 6.4 billion YOY
- The Holding’s EBITDA grew 82% to RUB 5 billion YOY
- UWC had its EBITDA margin at 21.4%, an increase of 5.2 pp compared to 1H 2015
Comments
UWC’s consolidated revenue grew 38% to RUB 23.5 billion compared to 1H 2015. The indicator growth was largely contributed by the increased revenue derived from the Operation division and sales of railcars to third parties.
The Operation revenue grew 3 times to RUB 6.4 billion spurred by a drastic expansion of Vostok1520’s fleet, higher efficiency of railcars under operation and increasing rolling stock operation rates.
The Holding’s EBITDA grew 82% to RUB 5 billion amidst the overall growth of this indicator in each business segment. The EBITDA margin gained 5.2 pp reaching 21.4%. The margin growth was due to higher efficiency of the Holding's operating activities boosted by a set of measures aiming to reduce the production costs, enhance the production capacity, attract customers and raise the turnover rate of the fleet under control.
UWC's loss before tax in 1H 2016 was RUB 1.6 billion against RUB 5.3 billion last year. The loss mostly included non-monetary amortization expenses and interest expenses on borrowings and bonds. Smaller loss in this reporting period compared to last year was due to a significant increase in the operating profit. The negative financial performance in 2015 was largely inflicted by a currency exchange loss, which was not the case in 2016.
According to Anton Saykin, UWC’s CFO: “In the first six months of 2016 the railway market continued its recovery, spurring further demand for UWC’s products and services. The positive trend resulted in a significantly larger revenue earned by the Holding. We have also been able to raise the EBITDA margin in all divisions through the successful implementation of our business efficiency improvement plans. The smart management of production costs and business expenses brought on a material reduction in the loss before tax, further improvement of this indicator expected.”
