Operating expenses up 2.8% in Georgia
Baku, Azerbaijan, July 26
By Tamilla Mammadova – Trend:
Operating expenses, excluding the PPE (property, plant and equipment impairment, remained relatively flat in Georgia, up 2.8 percent to $152.1 million in 2018, Trend reports via research of Galt & Taggart, a leading investment banking and investment management services company in the country.
The major expense categories which were up in the reporting period were employee benefits, which increased 3 percent to $60.9 million due to increased business trip expenses, as well as change in capitalized employee expense calculation.
Electricity, consumables and maintenance expenses increased 4.3 percent to $17.2 million, mostly related to increased fuel expenses. Other expenses increased 25.3 percent to $18.5 million as growing cargo containerization increased logistical services expenses.
Meanwhile, taxes other than taxes on income reduced 23.7 percent to $10.6 in 2018 (in 2017 other taxes included one-off $3.1 million difference between accounting and tax base).
Georgia recognized a significant 691.3 million lari ($272.8 million) impairment loss on PPE in 2018, in addition to 382.6 million lari ($152.5 million) impairment loss recognized by the company in 2017 (related to the Tbilisi Bypass project - railway project around the city).
Georgia’s net loss almost doubled in 2018 due to recognized impairment. Georgia recognized a $272.8 million impairment loss on PPE in addition to $4.7 million impairment loss on trade receivables in 2018.
FY18 operating cash flow decreased 0.6 percent to $70.6 million. Cash outflows from investing activities (mainly related to purchase of two new double-decker trains in 1H17) were down 48.6 percent to $29.7 million. Cash flow from financing activities increased 74.1 percent to $44.3 million in 2018.