Page 159 - RusRPTOct20

The management of Russia's largest gondola operator​ ​Globaltrans​ said that it has been preparing a local listing of its shares​, which Sberbank CIB on September 3 sees as a potential driver for the name. As reported by ​bne IntelliNews,​ Globaltrans reported a 16% year-on-year decline in revenues in 1H20 under IFRS due to lower gondola tariffs, ​but still beat the consensus expectations​ on the top line by 8%. The company is one the most ​attractive equity names and dividend payers​, and recently ​approved a share buyback seen as supportive for the name​. Sberbank CIB maintains a positive view on the stock and reiterates the Buy call on the shares, now with an upgraded $9.08 per share target price. Sberbank CIB also notes that recent cargo transportation data from Russian Railways (​as reported by ​bne IntelliNews t​ his week​) looked positive for the cargo transportation segment, indicating that the y/y decline in transportation volumes in tonnes eased from 4.5% in 6M20 to 4.0% in 8M20. This, together with a 2H20 dividend guided at RUB5bn ($66.2mn), is another positive driver for Globaltruck, Sberbank CIB believes, expecting the company to pay RUB13.3bn in dividends in the next 12 months, for a double-digit 16% yield.
Russian transportation major ​Globaltrans​ reported a 16% year-on-year decline in revenues in 1H20 under IFRS due to lower gondola tariffs, ​but still beat the consensus expectations on the top line by 8%. As reported by ​bne Intellinews​, Russia's largest gondola operator Globaltrans is one the most attractive equity names and dividend payers​, and recently ​approved a share buyback seen as supportive for the name​. In 1H20, despite the 27% decline in Ebitda, Globaltrans still beat the expectations with RUB14.6bn ($198.1mn) earnings, and 51% margin versus 46.5% expected by the consensus. Free cash flow (FCF) remained positive at RUB7bn. "Growth of volumes despite [coronavirus (COVID-19)], better than expected trends in gondola tariffs along with efficient cost control helped to keep Ebitda margin at 51%," BCS Global Markets commented on September 1, while noting that FCF was just 15% lower y/y, helped by lower capex. At the same time Globaltrans guided for 2H20 interim dividend of RUB5bn, in addition to RUB8.3bn dividend for 2H20, which BCS GM sees as a positive surprise for the name. The planned listing on Moscow Exchange in 2H20 is seen by the analysts as a positive trigger, as it would lead to improved liquidity and unlock of an upside potential from the company’s generous dividends. BCS GM affirmed the Buy recommendation on the name with target price of $7.5.
9.2.13 ​Other sector corporate news
MD Medical Group​ (MDMG) released upbeat corporate newsflow related to its financial results and capital allocation. ​In addition to stable 1H20 revenues, the company reported a 100bp y/y improvement in EBITDA margin to 28.5%, which we link to higherprofitability from COVID-19 related procedures. Net income increased 19% y/y, receiving further support from lower leverage, as net debt declined 44% y/y to RUB2.3bn and 0.5x net
159 ​RUSSIA Country Report​ October 2020 ​ ​www.intellinews.com