Analysis of financial results (IFRS)

Our strong balance sheet was underpinned by the initiatives seeking to improve the efficiency of freight transportation and streamline rolling stock management despite somewhat weaker operating growth. As a result, the Group’s income in 2019 grew by 3.9% y-o-y to RUB 2,508 bn vs RUB 2,413 bn in 2018. Our EBITDA rose by 9.4% to RUB 577 bn, while EBITDA margin amounted to 25.8%Here and elsewhere, the EBITDA margin factors in a revenue adjustment of RUB 268 bn, which constitutes the cost of third parties’ integrated forwarding and logistics services. on the back of strong operating results and cost controls.”

Vadim Mikhailov First Deputy CEO of Russian Railways

In 2019, the Group’s income grew by 3.9% y-o-y to RUB 2,508 bn vs RUB 2,413 bn in 2018.

This growth was mainly attributable to income from freight transportation and infrastructure services going up by 4.4% y-o-y to RUB 1,598 bn.

Income from passenger transportation grew by 6.3% to RUB 267 bn, while income from logistics services provided by GEFCO grew by 2.0% to EUR 4.739 bn.

In 2019, the Group’s operating expenses increased to RUB 2,348 bn (up 1.3% y-o-y) vs RUB 2,318 bn in 2018 due to higher prices for consumed products and fuel and energy. Payroll and social expenses went up as a result of a phased salary indexation programme implemented during 2019.

The Group’s net profit reached RUB 155.7 bn.

In 2019, EBITDA went up by 9.4% y-o-y to RUB 576.9 bn vs RUB 527.4 bn in 2018.

As at 31 December 2019, the Group’s net debt / EBITDA stood at 2.49x, an evidence of our sound financial health.