PJSC “Research and production corporation “United Wagon Company” (“RPC UWC” or the Holding) (MOEX: UWGN), the leader in innovative railcar building in the 1520 mm track gauge zone, announces its consolidated financial results for the year 2015 prepared in accordance with the IFRS.
2015 Key Results:
- RPC UWC’s consolidated revenue increased 147% to reach RUB 42.1 billion
- The Production revenue was RUB 32.1 billion, an increase of 38%
- The Holding ’ s EBITDA grew 97% YOY to RUB 7 billion
- The Production EBITDA gained 223% to reach RUB 4.2 billion
RPC UWC’s consolidated revenue increased 147% compared to 2014 to reach a total of RUB 42.1 billion. The positive dynamics was due to higher profitability of the Production division, increasing railcar sales in the market, and higher earnings of Vostok1520, RPC UWC’s railcar operator.
The Production revenue reached RUB 32.1 billion, an increase of 38% driven by 28% larger railcar production output and higher product prices in the reporting year.
The Holding's total cost of sales was RUB 37.9 billion. The amount of the consolidated cost of sales was mainly contributed by the Production Division with its cost of sales worth RUB 29.8 billion. Growing railcar production and the implementation of cost of sales reduction measures resulted in a smaller share of the Production Division’s cost of sales in the revenue with the Division receiving a positive gross profit.
While the Holding’s EBITDA grew 97% to reach RUB 7 billion, the EBITDA margin went 4 pp down to 17%. The fall in the margin was triggered by larger shares of the less marginal Production and Operation Divisions in the consolidated revenue. The EBITDA margin of the Production Division went 7 pp up to 13%.
The Holding’s net loss for the year totaled RUB 9.7 billion compared to RUB 0.5 billion worth profit in the previous year. The loss incurred over the reporting period mainly comprises nonmonetary amortization expenses and currency exchange losses, together with financial costs increased by higher interest expenses on the bonds with coupon rates dependent on the inflation.
Anton Saykin, RPC UWC’s Financial Director, commented: “Given the adverse macroeconomic environment, in 2015 UWC was able to demonstrate significant growth in its operating performance and revenues. The Company achieved its yearly targets with respect to the increase of the production volumes and reduction of its cost of sales, which doubled the EBITDA margin in the Production Division. Massive renovation of the fleet takes the freight transportation market to a new level. We expect the demand for UWC’s products to grow in 2016, which, along with implementation of the strategies to maximize the production operational efficiency, will further improve the Holding’s financial performance».