OREANDA-NEWS. Joint Stock Company SG-trans (the “Company”, “SGT” and together with its consolidated subsidiaries “SG-trans” or “the Group”), a leading Russian rail freight operator, today announces its preliminary unaudited financial and operational results for the 12 months ended 31 December 2013.

FY 2013 Financial Highlights

Revenue grew by 46% year-on-year to RUB 20.1 bn from RUB 13.8 bn in FY 2012;

EBITDA increased by 52% in 2013 to RUB 6.0 bn from RUB 4.0 bn in the previous year;

EBITDA margin expanded to 30% from 29% in 2012;

Net profit for the period grew by 178% to RUB 878 mln from RUB 316 mln in 2012;

Net debt as of 31 December 2013 was RUB 28 bn, compared to RUB 10.7 bn as of 31 December 2012.

FY 2013 Operational Highlights

Through the consolidation of subsidiaries and acquired assets, SG-trans has emerged as a universal rail freight operator with a total fleet of nearly 32,000 railcars under operation as of year end 2013;

Total transportation volumes increased by 69% year-on-year to 18.8 million tonnes in 2013;

Total freight turnover was up 72% year-on-year to 32.3 bn tonne-kilometres during the reporting period;

Strong performance in the Company's LPG segment earned a leading 29% market share in Russian LPG transport in 2013;

New long-term contracts signed with Sibur and Sanors holding companies.

Results of corporate restructuring and M&A

SG-trans spun off its non-core assets into a separate company, SG-trading, 100% owned by Sistema, in 2013.

Financial Alliance CJSC (further “Financial Alliance”) acquired 100% of Bashneft-Trans LLC for approximately RUB 100 mln in April 2013.

At the end of April 2013, Unirail Holdings Limited (further “Unirail Holdings”) and Sistema JSFC (further “Sistema”) began a multi-phased restructuring process of SG-trans, through which the two became owners of SG-trans on a parity basis. Financial Alliance and SG-trans were merged into one company under the SG-trans brand, and the restructuring process was officially completed in January 2014.

Aleksey Taicher, President of SG-trans, commented on the results:

“Many have spoken about 2013 being a challenging year for the rail freight sector. For SG-trans, 2013 was an exceptional year of successful business restructuring and building a strong and diverse platform from which we can continue to grow. We significantly expanded our fleet, through both purchasing new railcars as well as the successful merger with Financial Alliance. We have attracted an experienced management team. Thanks to their professionalism and efforts, we achieved significant operational efficiencies. Additionally, we expanded our client portfolio with a number of new long-term contracts with leading players in the petrochemical sector, reaching new geographies within the Russian and CIS markets. My view of SG-trans' future is focused on building a leading universal and diversified rail freight operator with a diverse service offering, including repair services.”

Konstantin Voevodin, Financial Director of SG-trans, added:

“2013 was a year in which we saw strong growth across all key financial metrics. Our revenue was up 46%, EBITDA added 52% and net profit increased by 178%. We will retain our focus on cost management, optimization of SG&A costs, and integration processes of recently acquired subsidiaries to further improve our profitability. Looking ahead, we believe the operating efficiencies achieved in 2013 will enable us to maintain a solid profit margin even in the current market environment, and we will be very well positioned to capitalise when demand recovers and the economic cycle picks up.”