“National Rating Agency” has increased the credit rating of the company “RAIL1520” LLC to “AA-” on the national scale.
Limited Liability Company “RAIL1520” was established in early 2011 to provide services for the operational leasing for freight rolling stock. Among the clients of the Company are large transport companies and industrial enterprises operating in the key industries: gas, forestry, metallurgy, petroleum, coal and chemical, including such companies as CJSC “Eurosib SPb-TS”, “ZapSib-Transservice” LLC, CJSC “NefteTransServis”, OJSC “SUEK”, “TEK Nizhegorodski Express” LLC, “URALCHEM-TRANS” LLC, “Fintrans GL” LLC and others.
Since 2012 RAIL1520 (hereinafter – the Company) operates under the management of a Limited Liability Company “United Wagon Company” (UWC), an integrated provider of rail services in the areas of manufacturing, leasing, engineering as well as maintenance of freight cars. The Holding company uniting RAIL1520 and UWC is UNITED WAGON PLC (credit rating of the NRA at “AA-” on the national scale). Consolidated leasing portfolio of the companies under the management of “United Wagon Company” LLC (“RAIL1520” LLC, “RAILL1520 SERVICE” LLC, “RAIL1520 LEASING” LLC, and “MRC 1520” LLC) as of December 31, 2013 amounted to more than RUR 20.6 billion, which is 36% higher than in 2012. Net leasing portfolio of “RAIL1520” LLC at the end of 2013 reached RUR 16.1 billion.
The principal supplier of rail freight rolling stock to the Company RAIL1520 is Closed Joint-Stock Company “Tikhvin Freight Car Building Plant” (being under the management of UWC). The structure of the lease portfolio of RAIL1520 is dominated by large transaction amounting to RUR 500-1000 million concluded for a long term (mostly for over 4 years). Overdue indebtedness on the rent payments is almost absent due to the high reliability of the Company's customers.
Total assets of RAIL1520 as of September 30, 2013 grew by 23% as compared with the same period of 2012 and reached a value of RUR 21 billion. The structure of assets is consistent with the nature of the Company’s business: about 65% of all assets are profitable investments in tangible assets (cars transferred in operational leasing), while another 25% account for current account receivables. In 2-3 quarters of 2013 the Company has increased its additional capital by approximately RUR 1.77 billion by depositing of funds by the shareholder. As a result, as of September 30, 2013 the Company's shareholders' equity was increased by 60% as compared with the same period of 2012, to over RUR 5 billion. Growth rate of equity funds has far exceeded the dynamics of the growth of assets which has positively affected the autonomy ratio (it has increased from 0.19 as of 30.09.2012 to 0.24 as of 30.09.2013).
The amount of the collected lease payments for 12 months of 2013 totaled to RUR 2.9 billion, which is 21% higher as compared with the data for 2012. Operating profit for the 3rd quarter of 2013 amounted to RUR 1.4 billion versus RUR 1 billion for Q3 2012. Despite the growth in operating profit, the Company has received a negative financial result in the amount of RUR 87 million primarily due to the growth of foreign exchange rate losses and an increase in payments on property tax, bank charges and the negative result of the transaction a forward contract.
“Incorporation of “RAIL1520” LLC under the management of “UWC” LLC whose creditworthiness was evaluated by the Agency at a very high level has become one of the major factors contributing to the increase in the credit rating. Besides, a positive effect on the rating was due to the following factors: the increase of the capital and the coefficient of autonomy; improving of debt load indicators; the positive trend of assets, leasing portfolio and the rental income. Constraining impact on the level of the rating was due to negative dynamics of profitability indicators”, - observes Natalia Soboleva, a senior analyst at the National Rating Agency.