Page 111 - RUSRptOct18

9% for 2017). Oil and oil products – the second-largest cargo category – finished the year nearly flat. We also highlight a record year for grain, volumes of, which grew 16.4% y/y.
Russian Railways (RZD) signed a deal for new high speed trains with the Sinara Group, Siemens AG (the Russian subsidiary of Siemens ) and the German Mills Department of Siemens Mobility, for the purchase of high-speed Sapsan trains, the company said in a statement on September 19. The joint venture Sinara and Siemens AG, along with Ural Locomotives, will supply RZD with 11 new Sapsanov high speed trains and 27 new passenger cars, that will be integrated with those already in service.
Russian Railways (RZD) could invest RUB7 trillion to RUB10 trillion ($100bn-$144bn) until 2025 under its long-term development program , deputy head of state railroad Alexander Misharin monopoly said at the Eastern Economic Forum. Notably, the so-called 'Belousov list' Russian industrial majors being courted by the government to boost infrastructure investment could participate in RZD investment projects, the Minister of Economic Development Maxim Oreshkin told the press at the sidelines of the same forum, as cited by Tass. Previously presidential aide Andrei Belousov controversially proposed to slap a one-time selective tax on "extra revenues" of Russia's largest metals and chemical majors worth up to RUB500bn. Later, while meeting with representatives of the 14 metals, mining, and chemical companies, Belousov said he did not see the sense in raising taxes, but announced that the companies had agreed to the proposal to participate in investment projects over the next six years . The Finance Ministry and the government initially opposed Belousov, but now is supporting the drive to mobilise the capex of the companies to support President's Vladimir Putin's six-year RUB8 trillion spending spree. Accoording to Misharin, the main investment projects of RZD in the long-run are the mega-bridge to Sakhalin island , Sakhalin connection to the Japanese island Hokkaido, the development of high-speed cargo railways, and the second Severomuysky Tunnel on the Baikal-Amur mainline. Involvement of private industry majors in the investment programme of RZD is likely to be met negatively due to long history of inefficiency and corruption in the company. In 2015-2016 RZD underwent a top-bottom revamp as Kremlin sacked its former boss Vladimir Yakunin , who counted on almost unconditional state support for a $1 trillion investment programme he launched in 2007. Despite expecting cost and operating efficiency improvements under the company's new president Oleg Belozerov, earlier reports already warned that RZD might still need to rely on government support . The railway system has also been heavily involved in a string of massive Russian military exercises, moving large numbers of troops and equipment around the country amid continuing Russian stand-off with the West over Ukraine and Syria.
9.2.13 Other sector corporate news
MD Medical Group 1H18 IFRS results were flattish earnings and expanding leverage . MDMG has released modest 1H18 IFRS, with an 8% y/y advance in revenues and flattish y/y EBITDA and net income performances. Key headwinds included a slowdown in birth rates in Russia (5% lower y/y in 1H18 after 11% y/y correction in 2017), intensified competition in the IVF segment, and having three out of five hospitals in the ramping-up stage. Capex doubled y/y, to RUB 1.7bn, while net debt/EBITDA reached 0.7x as of June.
111 RUSSIA Country Report October 2018 www.intellinews.com