Public Joint Stock Company "TransContainer" announced its preliminary operating results for the fourth quarter and the full year of 2018. The positive operating results were mainly driven by the continuing growth of the Russian container transportation market, reflecting strong international freight flow dynamics, an increase in containerisation of the Russian railway freight transportation and positive macroeconomic environment.
Russia's container market demonstrated an accelerated growth in the fourth quarter of 2018 with transportation volumes growing 16.4% year-on-year to 1,224 thousand twenty-foot equivalent units (“TEU”). This was mainly driven by a 24.3% year-on-year increase in international transportation, while domestic transportation was up 7.0% year-on-year in the reporting quarter and 5.1% year-on-year for the full year of 2018.
The accelerated growth in the fourth quarter of 2018 brought the full year figures to the higher than expected level. In 2018, the Russian rail container market grew by 14.4% year-on-year to 4,441 thousand TEU. The main contributors were transit and import transportation segments which grew by 35.1% and 22.0%, respectively.
In the reporting quarter, container volumes transported by the Company’s flatcars and/or containers (including provision of own containers on the third-party flatcars) were up 8.9% year-on-year to 501 thousand TEU. This was mainly due to the continued growth in international transportation, which was up 20.3% year-on-year, with import and transit segments surging by 23.4% and 47.1%, respectively. In the fourth quarter of 2018, container volumes using TransContainer’s assets on domestic routes were lower compared to the corresponding period of 2017, mainly as a result of the Company’s fleet reallocation in favour of fast-growing international routes amid the shortage of flatcars, as well as due to the optimisation of TransContainer's empty runs.
The Company’s revenue-generating 1 container transportation volumes in Russia amounted to 419 thousand TEU in the fourth quarter of 2018, up 13.8% year-on-year. For the full year of 2018, container volumes transported by the Company’s flatcars and/or containers grew by 6.1% year-on-year to 1,886 thousand TEU, mainly as a result of a 14.3% year-on-year increase in international transportation.
In 2018, the Company’s revenue-generating container transportation volumes in Russia amounted to 1,544 thousand TEU, up 8.4% year-on-year.
The growth rates of the Company’s revenue-generating volumes in the fourth quarter and for the full year were considerably higher compared to the increase in total transportation by the Company’s flatcars and/or containers, due to the optimisation of TransContainer's empty runs.
In the fourth quarter of 2018, the Company’s throughput in the Russian rail container terminal network decreased by 0.7% to 331 thousand TEU, compared to 333 thousand TEU for the same period of 2017. For full year of 2018, the Company’s container terminal throughput was down 1.1% and amounted to 1,279 thousand TEU compared to 1,294 thousand TEU for the full year 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 growth of container freight going directly from/to the producers’ own freight yards. In addition, the Company had to close a number of its terminals in Moscow to comply with the decision of the Government of Moscow.
TransContainer (LSE: TRCN; MOEX: TRCN) is the leading intermodal container transportation company in Russia with a market share of approximately 43%. It is the market leader in Russia by flatcar fleet size, container transportation by rail and rail-side container terminal throughput. As at 30 September 2018, it owned and leased 25,903 flatcars and 67,852 ISO containers. TransContainer owns a network of rail-side container terminals, located at 40 railway stations across Russia. The company’s joint ventures and subsidiaries also operate one terminal in Slovakia, two terminals in Russia and 19 inland rail-side terminals in Kazakhstan. The Company's sales network comprises of 98 sales outlets in Russia, along with additional outlets across the CIS, Europe and Asia. TransContainer is listed on the Moscow Exchange and London Stock Exchange. The Company's major shareholder with 50% +2 shares is United Transportation and Logistics Company, established by Russian Railways, Belorussian Railway and Kazakhstan Temir Zholy.