The Hamburg-based wagon hire and rail logistics company, VTG Aktiengesellschaft (SCI: VTG999), performed solidly in the first three months of the 2009 financial year, despite a challenging market environment. Revenue fell slightly by 1.5 percent to EUR 145.2 million, thus reaching the same level as last year. The EBITDA increased by 5.1 percent to EUR 38.3 million. Operating cash flow increased 17.2 percent to EUR 36.4 million, well above last year’s value.
"Our good figures for the first quarter of this year, show that we are also capable of working successfully in difficult economic times. Sustained success also means adapting oneself early to a continuingly weak market, and having the respective measures well prepared," states Dr. Heiko Fischer, CEO of VTG Aktiengesellschaft. "This is the why we intend to keep the speed and volume of our investments in 2009 below the level of last year. In the middle-term, we will continue to pursue our international strategy of growth."
Wagon Hire Division with stable development
The Wagon Hire Division performed well in the first quarter of the year. The demand for wagons remained at a satisfactory level, although not all returns can be rehired currently. The utilization rate for the fleet lies at the high level of 90.0 percent. VTG does not sense any significant decrease in the demand for wagon hire currently. The division's revenue of EUR 71.2 million remained at the same level as the comparative period last year (EUR 71.7 million). The EBITDA actually rose by 5.7 percent, from EUR 36.4 million to EUR 38.5 million. The EBITDA margin, which relates to revenue, improved correspondingly, from 50.7 percent to 54.1 percent.
Rail Logistics Division continues with solid growth
The Rail Logistics Division profited from constant demand, in particular in cross-border block train transport from and to South-East and Eastern Europe. This was underlined by an increase in revenue of 9.9 percent to EUR 47.1 million. The EBITDA increased significantly by 12.1 percent to EUR 1.3 million. The EBITDA margin, which relates to gross income, reached 36.3 percent, compared to 37.8 percent in the first quarter of 2008.
Tank Container Logistics Division affected by drop in demand in the chemicals industry
As an integral part of the supply chain in the chemicals industry, the Tank Container Logistics Division has been strongly affected by the global economic crisis. Drastically sinking transport volumes worldwide, coupled with continuingly high capacities in the market, have led to a clear drop in revenues. Correspondingly the revenue fell by 18.4 percent to EUR 26.8 million. The EBITDA of EUR 1.6 million was 24.6 percent under that for the previous year. The EBITDA margin, calculated on the basis of gross income, reached 41.2 percent, a similar level to the comparative quarter of the previous year (41.4 percent).
Outlook: solid development in business despite tense short-term economic prospects
VTG assumes that the economic climate will hardly improve during the rest of the financial year, but do not expect a larger drop in demand at the VTG business divisions. In line with this, the business development for Wagon Hire will continue to decrease moderately, the economic crisis will make itself noticeable in the Rail Logistics Divisions in the course of the year, and VTG will adjust itself to the prospect of a sustained lower level of demand at the Tank Container Logistics Division. Preventive and flexible measures to ensure results are planned at all three divisions and will be implemented in line with developments in the market. These range from the incremental implementation of cost-saving measures, to adjustments in investments.