Russian Railways sees 2010 net profit at RUB 70bn.

By bne IntelliNews December 23, 2010
State rail monopoly Russian Railways expects net profit this year to increase to RUB 70bn (USD 2.28bn), company's president Vladimir Yakunin announced to the press without providing the accounting standards used. If 2009 profit of RUB 14.4bn is taken as a base, this would make almost a 5-fold y/y growth. However, Yakunin noted that in 2011 net profit is seen to drop to about RUB 2.7bn due to limitations on tariffs' growth (cargo transportation tariff's growth approved by the government for 2011 stands at 8%, while company believes that economically justified growth is 23%). Previously Russian Railways announced that it is going to have state funding cut by 24% to RUB 89bn in 2011. Company's total investment program for 2011 stands at RUB 349bn. State funding for the company in 2011-2013 is going to amount to RUB 157.5bn, including RUB 67bn in 2012 and RUB 0.5bn in 2013. To remind, IFRS net profit of Russian Railways almost doubled y/y to RUB 152.2bn in 2009 vs. RUB 76.4bn seen in 2008. Revenues decreased by 4% y/y to RUB 1.15tn, out of which revenues from cargo transportation stood at RUB 844bn (down by 6% y/y) and revenues from passenger transportation at RUB 166.7bn (up by 3% y/y). Operating expenses (less state subsidies) went down by 8.2% y/y to RUB 1tn last year, while EBITDA jumped 51% y/y to RUB 330bn. Russian Railways is 100% owned by the government. The company is planning to raise up to RUB 100bn from its subsidiaries until 2012. RZD plans to sell stakes in about 30 companies, the largest assets being 50% minus two shares in First Cargo Company and 35% minus two shares in TransContainer, as well as 50% minus two shares stakes in companies such as Elteza, RZD Stroy, RemPutMash and others.

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