Russia’s leading private wagon leasing firm Brunswick Rail Limited recorded a 20% decline in gross revenue in 2014. Net loss in 2014 was US$ 275.5m as against net profit of US$ 28.0m in 2013, and net cash from operating activities was US$ 166.8m compared to US$ 182.6m in 2013.
Its total fleet stood at 25,562 railcars, including 208 railcars on financial lease. The Group continued to diversify its fleet and took delivery of 1,903 new railcars, while selling 165 old gondolas and 200 old mineral hoppers as part of its fleet management programme to reduce the age of the fleet and diversify the fleet into specialized cars.
“Throughout 2014 and into 2015, we have seen a continued deterioration in the market environment. Transportation volumes have declined steadily, and an oversupply of railcars in the market has maintained strong downward pressure on rates, with spot rates in US dollar terms falling by more than 50% over the course of the year”, commented Brunswick Rail CEO Alex Genin.
“In addition, the sharp decline in the rouble against the dollar led to us having to re-negotiate a number of contracts from dollars into roubles, leaving our rouble revenue at a disproportionately high level relative to our liabilities”, he added.
“We reduced our capital expenditure from US$ 106m in 2013 to US$ 95m for 2014, with the majority of this having been invested in the first quarter of the year. This was in line with our strategy to defer our ambitious growth plans and instead to focus on cash preservation, cost cutting and maximizing operational efficiency”, stated Nicolas Pascault, Managing Director and Deputy CEO of Brunswick Rail.