Full Year 2010 Financial Results Announcement

Globaltrans Investment PLC (“Company” together with its consolidated subsidiaries “Globaltrans”, or the “Group”), (LSE ticker: GLTR) today announces its financial and operational results[1]for the year ended 31 December 2010.

Certain financial information which is derived from the management accounts is marked in this announcement with an asterisk {*}. Information (non-GAAP and operational measures) requiring additional explanation or defining is marked with initial capital letters and the explanations or definitions thereto are provided at the end of this announcement.


Globaltrans, Russia’s leading private freight rail transportation group, had an outstanding year in 2010, managing to benefit from the sustained recovery of the transportation market. Increased business volumes, a better pricing environment and continued stringent control of operating costs together enabled the Group to deliver an excellent set of financial and operational results.

Financial highlights

  • Adjusted Revenue increased by 32% to USD 903.0* million (2009: USD 685.3* million), driven by increases in Freight Rail Turnover as well as firmer pricing;
  • Total Operating Cash Costs amounted to USD 510.6* million, a year-on-year increase of 28% driven by increased business volumes. Operating lease rentals - rolling stock and Empty Run Costs were the key contributors to the above growth;
  • Adjusted EBITDA increased by 37% to USD 390.9* million (2009: USD 284.5* million). Adjusted EBITDA Margin improved to 43%* from 42%* in 2009;
  • Profit for the year increased by 86% to USD 225.9 million (2009: USD 121.2 million), Earnings per share increased by 51% to USD 1.12 per share;
  • Capital expenditures[2] increased to USD 286.2 million from USD 103.9 million in 2009; primarily due to the Group’s investment programme into new rolling stock;
  • Net Debt increased by 32% to USD 381.3* million (2009: USD 288.9* million). Year end Net Debt to Adjusted EBITDA ratio remained unchanged year-on-year at 1.0x*;
  • The Board of Directors recommended increased dividend of USD 58.5 million (37.00 US cents per ordinary share), compared to USD 24.0 million (15.18 US cents per ordinary share) paid in 2010.

Operational highlights

  • Outperformance of the overall Russian freight rail market: Globaltrans' Freight Rail Turnover (measured in tonnes-km) grew 20% year-on-year to 97.4 billion tonnes-km in 2010 versus an overall Russian market which grew by 8%[3];
  • Significant expansion of the Group's fleet resulting from acquisition of rolling stock as well as increased leased-in fleet. The Group’s Total Fleet increased by 36% or 13,497 units to 50,714 units of rolling stock at the end of 2010 compared to the end of previous year. Owned Fleet increased by 5,789 units and leased-in rolling stock increased by 7,708 units;
  • Globaltrans strengthened its overall share of the Russian freight rail volumes to 5.3%[4] in 2010 from 4.8%[4] in 2009;
  • Empty Run Ratio for gondola cars improved to 42% compared to 46% in 2009;
  • Average Price per Trip up 7% to USD 770.4 compared to the previous year, Average Distance of Loaded Trip decreased by 2%;
  • The Group’s Average Rolling Stock Operated increased by 30% year-on-year to 36,793 units compared to the previous year;
  • The Group’s rolling stock acquisition programme remained on schedule and on track in 2010. The remaining balance of 6,500 units of rolling stock contracted at the close of 2009 were all delivered and put into operation in 2010. An additional 1,500 units of rolling stock were contracted and delivered between September 2010 and February 2011 as a part of new acquisition target of 5,000 units of rolling stock.

CEO Comment

Sergey Maltsev, CEO of Globaltrans Investment PLC, said:
“I am delighted to report an outstanding set of results for Globaltrans, the product of a very strong operating performance by the Group. In the last few years we have demonstrated that, irrespective of market conditions, we can grow our business and outperform the market, and we did so again this year. In 2010 Globaltrans outpaced the Russian freight rail transport sector, capturing a large part of the market volume growth and winning market share.

Our opportunistic, return-oriented growth strategy again proved its value as our significant investment into new rolling stock provided to be both profitable and well-timed. We received railcars at very good prices and in addition ensured that we had the capacity in place to satisfy strong customer demand for our services.

The combination of economic growth and continued deregulation continues to provide a powerful stimulus to our market. And with our strong management, excellent customer franchise, modern fleet and robust finances we are well placed to further expand our business in 2011.”


In 2011, Russian economic growth is projected to accelerate and we therefore expect our industry fundamentals to continue to reassert themselves. Our trading performance so far in 2011 tends to support this view.

Looking ahead, into 2011, we should reap the full benefit from the operational deployment of new rolling stock delivered in 2010, supported by our ongoing rolling stock acquisition program of 5,000 units.

Operationally, we will continue to concentrate our efforts on improving efficiency levels of our fleet utilisation focusing on increasing our use of block trains, minimising empty runs, ongoing transfer of repairs to mileage based system as well as increasing transportation volumes to neighbouring CIS countries.

In 2011, the government is due to unveil details concerning partial deregulation of locomotive traction as well as plans for further privatisation in the industry. We are monitoring these developments closely. The operation of additional locomotives would complement our business. Once there is an acceptable legislative framework in place, then we will elaborate our investment plans for locomotives.

Analyst and Investor Conference Call

For replay of an analyst and investor conference call hosted by Sergey Maltsev, Chief Executive Officer and Alexander Shenets, Chief Financial Officer on Monday, April 4th, 2011, please click here.


Globaltrans Investor Relations

Priit Pedaja
Mikhail Perestyuk
+357 25 503 153

Globaltrans (Globaltrans Investment PLC together with its subsidiaries - "Globaltrans" or "the Group") is the largest privately owned freight rail transportation group with operations in Russia by the size of owned rolling stock fleet (based on publicly available information) and the first such group to have an international listing.

Globaltrans Investment PLC is incorporated in Cyprus and has operating subsidiaries in Russia, Ukraine and Estonia. The Group provides freight rail transportation, railcar leasing, and certain ancillary services to clients in Russia, the CIS countries and the Baltics.

Group’s fleet of rolling stock owned and leased under finance and operating leases amounted to 50,714 units at the end of 2010, including 29,568 gondola cars, 20,598 rail tank cars, 58 locomotives and 490 other railcars.

The Group’s Freight Rail Turnover in 2010 amounted to 97.4 billion tonnes-km with 63.8 million tonnes of freight transported. In 2010 the Group’s Adjusted Revenue amounted to USD 903.0* million with Adjusted EBITDA reaching USD 390.9* million.

Globaltrans' global depositary receipts (ticker symbol: GLTR) are listed on the Main Market of the London Stock Exchange since May 2008.

To learn more on Globaltrans, please visit www.globaltrans.com.

Some of the information in this announcement may contain projections or other forward-looking statements regarding future events or the future financial performance of Globaltrans. You can identify forward-looking statements by terms such as 'expect', 'believe', 'anticipate', 'estimate', 'intend', 'will', 'could', 'may' or 'might', the negative of such terms or other similar expressions. Globaltrans wishes to caution you that these statements are only predictions and that actual events or results may differ materially. Globaltrans does not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in projections or forward-looking statements of Globaltrans, including, among others, general economic conditions, the competitive environment, risks associated with operating in Russia, rapid technological and market change in the industries Globaltrans operates in, as well as many other risks specifically related to Globaltrans and its operations.


[1] The Group’s financial performance in 2010 was affected by a 4% appreciation of the average exchange rate of the Rouble (Functional Currency of the Company, its Cyprus and Russian subsidiaries) against the US Dollar (the Group’s financial information presentation currency). In accordance with the Group’s accounting policies, the reported financial and operational results include results of LLC BaltTransServis (acquired in December 2009) for the years ended 31 December 2009 and 2010.

[2] Additions of rolling stock in 2010 as well as capitalised repairs (including rolling stock leased under finance leases).

[3] According to Rosstat.

[4] Company estimations based on Rosstat data; calculated as a percentage of the overall freight rail transportation volume in Russia.