In 2020, the Group’s consolidated revenue increased by 10% to RUB 62,168 million vs RUB 56,673 million in 2019. All business segments except for the Rail and Bunkering divisions showed YoY growth of revenue.
|Revenue, RUB m||56,673||62,168||10|
|EBITDA, RUB m||12,231||12,293||1|
|EBITDA margin, %||22||20||2 pp|
|Liner and Logistics Division||37,944||46,586||23|
In 2020, the Port Division's revenue went up 6%, or RUB 917 million to RUB 16,326 million vs RUB 15,409 million in 2019.
The key drivers were growth in import and export turnover of container cargo by 10%, greater turnover of high margin general cargos (coke and coal), a rise in rates, and changes in the vehicle turnover.
The Rail Division's revenue in 2020 dropped by 35% or RUB 2,892 million to RUB 5,340 million. The key driver for this decline was the grain segment sales in Q1 2020.
The Liner and Logistics Division's revenue went up by RUB 8,642 million or 23% YoY. The revenue growth was driven by:
- higher volumes carried by international routes;
- higher freight rates due to the lack of equipment;
- increase in intermodal transportation volumes;
- expanding the geography of land import services to meet the growing customer demand;
- increased volumes of domestic maritime transportation due to higher quality services (keeping the domestic maritime transportation at the highest level possible) and introduction of new routes.
The Shipping Division's revenue increased by 3%, or RUB 93 million, primarily on the back of charters, trips under the contract with Kinross Gold, and higher rates post the fleet upgrade.
A 29% decline of the Bunkering Division’s revenue to RUB 841 million was attributable to the absence of fuel sales to third parties and a shift in sales towards agency scheme.
|Liner and Logistics Division||32,834||40,278||23|
In 2020, the Group’s operating expenses increased by 13% to RUB 42,143 million vs RUB 37,279 million in 2019. The key contributor to the growth of the Group’s operating expenses was the increase in operating expenses of the Liner and Logistics Division due to higher transportation volumes.
Operating expenses of the Port Division slightly increased and were practically flat YoY with an insignificant decline in handling.
The Rail Division's operating expenses shrank by 33% or RUB 1,249 million due to selling the grain business, while those of the Liner and Logistics Division grew by 23% or RUB 7,444 million due to higher transportation volumes and railway tariff expenses on terminal services and road transportation.
Operating expenses of the Shipping Division decreased by 11% or RUB 231 million due to an increase in charters and purchase of new vessels that reduced operating expenses with an insignificant decline in capacity.
In 2020, FESCO’s gross profit stood at RUB 20,025 million vs RUB 19,394 million in 2019.
In 2020, the Group’s administrative expenses increased by 6% to RUB 7,782 million vs RUB 7,341 million in 2019.
|Salary and other staff related costs||5,028||5,575||11|
|Other administrative expenses||1,323||1,051||(21)|
|Total administrative expenses||7,341||7,782||6|
|Liner and Logistics Division||2,309||3,270||42|
|Liner and Logistics Division||6||7||1|
In 2020, the Group’s consolidated EBITDA increased by 1% to RUB 12,293 million vs RUB 12,231 million in 2019. EBITDA margin reduced by 2 pp to 20% vs 22% in 2019. The Rail Division's EBITDA decline was offset by growth in the Port Division and the Liner and Logistics Division.
The Port Division's EBITDA increased by 9%, or RUB 629 million, mainly driven by the cargo containerisation and container market expansion in the reporting year and larger handling volumes for container cargoes. At the same time, container handling in the Far East grew much faster than the market on the back of a strong commercial strategy, which helped increase FESCO's share in the Russian Far East to an all-time high of 45%.
The Rail Division's EBITDA dipped by 46%, or RUB 1,657 million YoY, as the Division's performance was under pressure from negative trends in the market of box car rates. In addition, the grain segment was sold in Q1 2020.
The Liner and Logistics Division's EBITDA increased by 42% or RUB 961 million. In 2020, international routes demonstrated much better performance than in 2019, as freight rates rose due to the lack of equipment in the market. Stable exports resulted in a better disequilibrium between imports and exports, which notably reduced container expenses. The domestic transportation growth was mainly driven by infrastructure projects and industrial construction. The key drivers of intermodal transportation growth included the ramp-up of car transportation projects, opening new routes to expand the geography of land import services and meet the growing demand, and increasing the direct customer base.
In 2020, the Shipping Division’s EBITDA went up by RUB 228 million or 29% YoY. Such impressive improvement in the Division’s performance was attributable to the project of gold mining equipment delivery implemented jointly with Kinross Gold, a greater number of time charter trips than in 2019 and improved fleet performance post upgrade.
In 2020, the Group’s depreciation and amortisation charges reduced by 15% to RUB 2,959 million vs RUB 3,485 million in 2019 mainly due to the sale of non-core vehicles from the Rail Division.
|Liner and Logistics Division||285||412||44|
Profit/(loss) from operating activity
In 2020, FESCO’s profit from operating activity stood at RUB 8,157 million vs RUB 8,304 million in 2019.
Other financial expenses
FESCO’s other net financial income and expenses increased from RUB (7,373) million in 2019 to RUB 2,419 million in the reporting year primarily on the back of foreign exchange gain and lower interest expenses.
Share of profit of equity accounted investees
The Group's share of profit of equity accounted investees went up to RUB 95 million vs RUB 77 million in 2019.
Profit before income tax
In 2020, FESCO’s profit before income tax stood at RUB 9,861 million vs RUB 740 million in 2019.
Income tax expense fell by 41% to RUB 1,515 million vs RUB 2,582 million in 2019. Income tax expense fell by 2% to RUB 2,251 million vsRUB 2,292 million in 2019.
Net profit stood at RUB 8,346 million vs net loss of RUB (1,842) million in 2019.
|Current tax expense|
|Deferred tax expense|
|Origination and reversal of temporary differences||290||(736)|
|Total income tax expense||2,582||1,515||(41)|
FESCO's liabilities as at 31 December 2020:
- RUB 31,732 million – loans and borrowings;
- RUB 1,960 million – lease liabilities.
Net debt shrank from RUB 38,062 million as at 31 December 2019 to RUB 29,552 million.
Net debt / EBITDA ratio as at 31 December 2020 decreased to 2.8x (excluding IFRS 16 impact).
|(Cash and cash equivalents)||(1,232)||(0.1x)||(4,140)||(0.4x)|
| Debt obligations and lease ||39,294||3.8х||33,692||3.2x|
The Group's CAPEX stood at RUB 3,103 million, with 90% of this amount attributable to the Port, Shipping and Rail Divisions.
Investments in the Port Division's infrastructure totalled RUB 839 million or 27% of FESCO's CAPEX.
The Shipping Division made up 28%, or RUB 855 million of the Group's CAPEX. FESCO added two multi-purpose bulk carriers to its fleet – FESCO PARIS and FESCO ULISS. The vessels cost RUB 828 million, with dry docking expenses amounting to RUB 12 million.
In 2020, Rail Division's CAPEX totalled RUB 1,111 million with most of this amount – RUB 1,002 million or 90% – spent on the procurement and repair of wheel sets.