BAKU, Azerbaijan, June 9
By Tamilla Mammadova – Trend:
Despite growth in transportation volumes by Georgian Railways (GR), revenue from freight transportation recorded a decline in 2020, driven by declines in both, liquid and dry cargo transportation revenues, Trend reports via the Galt & Taggart investment bank.
Liquid cargo revenue, which is almost entirely made up of oil products declined 13.1 percent year on year to $39.1 million.
The decline was mostly driven by lower tariffs earned on oil products transportation (-12 percent year-on-year) due to changes in product direction and product category mix (less share of Russia and aviation fuel which are more profitable direction).
Overall, dry cargo transportation volumes posted a positive 3 percent year-on-year growth in 2020, however, revenue from dry transportation was down 2.8 percent year-on-year to $62.7 million.
The decline was mostly driven by lower tariffs as well as a change in product direction mix. Growth in chemical and fertilizers as well as other categories partially compensated the losses in other dry product transportation revenues:
Ores (-23.1 percent year-on-year to $10.7 million);
Chemicals and fertilizers (+26.2 percent year-on-year to $7.4 million);
Sugar (-21.5 percent year-on-year to $3.9 million);
Grain (-18.4 percent year-on-year to $2.6 million)
Construction freight (-25.7 percent year-on-year to $2.3 million)
Industrial freight (-26 percent year-on-year to $2 million)
Cement (-71.3 percent year-on-year to $0.2 million)
Other (+12.2 percent year-on-year to $30.1 million
GR’s operating expenses (excluding the PPE impairment) declined 9.3 percent year-on-year to $116.4 million in 2020. The decline was mostly driven by lower depreciation and amortization expenses.
"Slight deterioration in the profitability on the one hand and lari’s continued weakness on the other put pressure on GR’s leverage. We forecast net debt-to-EBITDA margin to remain elevated in the medium term and retreat to below 4 levels by 2023 as the company’s profitability improves," the report said.
---
Follow the author on Twitter: @Mila6197935