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TransContainer announced its operating results

Public Joint Stock Company "TransContainer" ("TransContainer" or the "Company") (LSE: TRCN) announces its preliminary operating results for the second quarter and the first half of 2018. The positive operating results were mainly driven by the continuing growth of the Russian container transportation market, which, in turn, was fueled by an increase in international freight flows, as well as a positive macroeconomic environment.

 

Market overview

Russia's container market continued to show strong performance in the second quarter of 2018. The transportation volumes in the reporting quarter were up 11.9% year-on-year to 1,060 thousand twenty-foot equivalent units ("TEU"). This was mainly driven by a 19.9% ​​year-on-year increase in international transportation, with exports and transit segments demonstrating solid growth.

 

Russian Rail Container Transportation Market in 2Q 2018 (ISO Loaded + Empty), 000 'TEU

2Q 201 8 2Q 201 7 Change
000 'TEU Percent
Domestic Routes 460.4 447.7 +12.7 + 2.8%
Export 275.4 230.7 +44.7 + 19.4%
Import 197.5 169.2 +28.2 + 16.7%
Transit 126.6 99.9 +26.7 + 26.8%
All Routes 059.9 947.5 +112.4 + 11.9%

 

For the first half of 2018, the Russian rail container market grew by 12.1% year-on-year to 2,065 thousand TEU. In terms of segment breakdown for the six-month period, domestic transportation grew by 2.8% year-on-year, while transportation increased by 18.1% year-on-year, while import and transit transportation grew by 19.3% and 28.5% respectively.

 

Russian Rail Container Transportation Market in IH 2018 (ISO Loaded + Empty), 000 'TEU

1H 201 8 1H 201 7 Change
000 'TEU Percent
Domestic Routes 891.4 866.9 +24.5 + 2.8%
Export 552.1 467.3 +84.7 + 18.1%
Import 393.6 330.0 +63.7 + 19.3%
Transit 227.4 177.0 +50.4 + 28.5%
All Routes 064.5 1 841.2 +223.3 + 12.1%

 

Rail container transportation

In the reporting quarter, container volumes transported by the Company's flatcars and containers (including provision ofown containers to the third-party flatcars) were up 4.8% year-on-year to 458 thousand TEU. This was mainly due to the continued growth in international transportation, which was up 13.1% year-on-year, with exports and transit segments growing by 13.9% and 29.7%, respectively. Lower domestic transportation was due to TransContainer's empty runs optimization in the company of 9.5% year-on-year. The partial reallocation of the flatcar fleet in favor of international transportation was also one of the factors contributing to lower domestic transportation. This was done in order to support the fast-growing volumes on transit routes.

 

Transportation of containers using TransContainer's assets in 2Q 2018 (ISO Loaded + Empty), 000 'TEU

2Q 201 8 2Q 201 7 Change
000 'TEU Percent
Domestic Routes 219.6 226.0 -6.4 -2.8%
Export 117.1 102.8 +14.3 + 13.9%
Import 81.6 77.4 +4.2 + 5.4%
Transit 39.3 30.3 +9.0 + 29.7%
All Routes 457.5 436.4 +21.1 + 4.8%

 

Container volumes transported by the Company's flatcar fleet in the second quarter of 2018 increased by 6.8% year-on-year to 434 thousand TEU from 406 thousand TEU a year earlier. The Company's revenue-generating [1] container transportation volumes in Russia reached 376 thousand TEU in the second quarter of 2018, up 7.1% year-on-year.

For the first six months of 2018, container volumes were transported by the Company's flatcar and container fleet, as described above, grew by 3.8% year-on-year to 893 thousand TEU, mainly as a result of an increase in transit and export transportation.

 

Transportation of containers using TransContainer's assets in 1H 2018 (ISO Loaded + Empty), 000 'TEU

1H 201 8 1H 201 7 Change
000 'TEU Percent
Domestic Routes 423.3 439.7 -16.4 -3.7%
Export 236.6 215.6 +21.0 + 9.7%
Import 160.1 151.3 +8.8 + 5.8%
Transit 72.7 53.4 +19.3 + 36.2%
All Routes 892.7 860.0 +32.7 + 3.8%

 

Container volumes transported by the Company's flatcar fleet in the first half of 2018 increased by 5.9% year-on-year to 848 thousand TEU from 800 thousand TEU a year earlier. The Company's revenue-generating container transportation volumes in Russia amounted to 724 thousand TEU in the first half of 2018, up 6.3% year-on-year.

 

Terminal handling

In the second quarter of 2018, the Company's throughput in the Russian rail container terminal network decreased by 3.1% to 322 thousand TEU, compared to 332 thousand TEU for the same period of 2017. For the first six months of 2018, the Company's container terminal throughput was down 2.9% and total to 604 thousand TEU compared to 622 thousand TEU for the first half of 2017.

The Company's container handling lagged behind the market dynamics mainly due to the following factors: (i) the fast-growing transit volumes have limited impact on the container terminal handling; and (ii) continuing the growth of the container.

 

Asset utilisation

In the second quarter of 2018, container empty run ratios improved from 17.4% to 16.0%, while empty run for flatcars decreased from 3.8% to 2.6%. These improvements were largely due to the continuing optimisation of fleet efficiency .

 

2Q 201 8 2Q 201 7 1H 201 8 1H 201 7
Turnover of containers, days 30.4 35.7 33.5 38.2
Turnover of flatcars, days 11.7 12.0 12.1 12.1
Empty run [2] for containers,% 16.0% 17.4% 18.2% 19.8%
Empty run for flatcars,% 2.6% 3.8% 3.1% 3.6%

 

Turnover of flatcars improved from 12.0 days for the second quarter of 2017 to 11.7 days for the reporting quarter of 2018, while turnover of containers decreased from 35.7 to 30.4 days, respectively.





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