Page 109 - RusRPTSept19

Russian fertiliser major EuroChem reported net IFRS profit tripled to $612mn in 1H19, the company said on August 6. The Ebitda of the company increased by 21% y/y to $819mn, while the free cash flow of $136mn was reported versus negative FCF of $41mn a year ago. Improved financials were attributed by the company to favourable pricing environment and an increase in sales volumes. Net profit surged despite the $25mn loss that EuroChem reported on the sale of its distribution assets in Ukraine.
Russian diamond mining giant Alrosa decreased sales by 23% on the month to $170.5mn in July, including $164.6mn of rough diamonds and $5.9mn of polished diamonds, the company said in a statement on Friday. In January–July, the company’s sales fell 34.6% to $1.982bn, including $1.949bn of rough diamonds and $33.1mn of polished diamonds.
Phosagro reported its 2Q19 IFRS results. EBITDA declined almost 25% q/q to $284mn on lower prices and lower sales volumes versus 1Q19, which set a high base. The EBITDA margin was 32%. Leveraged FCF for 2Q19 came in at $159mn for a 3.3% yield thanks to a $97mn working capital release, which mainly owed to a decrease in receivables. In 2Q19, PhosAgro sold R4.95bn in receivables to a bank without recourse in exchange for R4.5bn in cash ($70mn at the 2Q19 average $/RUB). So the bulk of the working capital release came from factoring operations. On the conference call, the CFO guided that PhosAgro intends to use factoring one or several times per quarter during the next 2-3 years. Capex in 2Q19 (as reported on the cash flow statement) was $141mn. In 1H19, capex totaled R17.7bn, or 43-44% of the full-year guidance (R40-41bn including capitalized repairs), suggesting a slight capex uptick in 2H19. The total dividend payment is $105mn at the current $/RUB for a 2.2% yield. The payout is 76% of adjusted net income.
Russian metals major Norilsk Nickel reached a record-high market capitalisation of RUB2.6 trillion ($39bn) on the Moscow Exchange and $38.9bn on the London Stock Exchange on August 30. The company has 38% of its shares as a freefloat. The capitalisation jumped on the rising prices of nickel and palladium, which were pushed up by the nickel ore exports ban from Indonesia effective from December 2019. The nickel price rose 60% year-to- date as the market braces for nickel deficit due to the ban that affects about 10% of the metal's global volume.
9.2.12 Transport corporate news
Russian railroad monopoly Russian Railways (RZD) set the date for the auction of Transcontainer container operator for November 27 2019, the company said on August 7. RZD will put 50% plus 2 shares up for sale at a starting price of RUB36.16bn ($553mn). As reported by bne IntelliNews, this spring the Russian government outlined rules for the sale of controlling stake in Transcontainer, one of the most valuable transportation assets in Russia, on a market that saw a number of large deals in 2018. The Transcontainer deal has been delayed several times in botched privatisation efforts. The price of RUB36bn was announced in May, and was below the market valuation as capitalisation of the company in Moscow stood at about RUB89bn. But it would allow the company to attract a "wide number of investors," according to the head of RZD Andrei Starkov. In 2018 Russian billionaires Roman Abramovich and Alexander Abramov already acquired 24.5% stake in Transcontainer from RZD and reportedly intended to seek a controlling stake in one of Russia's most valuable transportation assets. Unconfirmed reports
109 RUSSIA Country Report September 2019 www.intellinews.com