VTG posts a good start into 2010

For the Hamburg-based wagon hire and rail logistics company VTG Aktiengesellschaft (WKN: VTG999) the positive rebound seen in the later part of 2009 continued in all operational divisions for the first quarter of 2010. Revenue increased by 6.6 percent, from EUR 145.2 million to EUR 154.8 million. Operating profit (EBITDA) decreased slightly compared with the previous year, by 2.6 percent, from EUR 38.3 million to EUR 37.3 million. Cash flow from operating activities decreased by 13.1 percent to EUR 31.6 million. 

“Not only did we show in 2009 that we can withstand an economic crisis but we are also already taking advantage of the improving economic situation in all operational divisions”, says Dr. Heiko Fischer, CEO of VTG Aktiengesellschaft. “On the whole, our customers are able to better utilize the capacity of our wagons and, accordingly, are returning fewer wagons. The logistics divisions, Rail Logistics and Tank Container Logistics, are seizing the opportunities for continued as well as new growth.”
 
Wagon Hire: Fleet capacity utilization level stabilizes
The Wagon Hire division performed well in the first quarter. The decline in capacity utilization continued to slow and decreased only slightly on the previous quarter, by 0.4 percentage points to 87.0% This represents the smallest drop for five quarters and shows that the business from customers continues to pick up. As their business improves the capacity of wagons already on hire are first better utilized and thereafter further wagons will be requested from VTG. Compared with the previous year, capacity utilization dropped by only three percentage points, from 90.0 percent to 87.0 percent. Revenue for this division amounted to EUR 74.0 million, 3.9 percent above that of the same period last year of EUR 71.2 million. This significant rise in revenue is largely due to a major wagon building contract awarded to Waggonbau Graaff in 2009. Due to the fact that capacity utilization was still declining slightly, EBITDA, at EUR 35.9 million, was 6.7 percent below the level of the previous year, but only slightly under the level of the previous quarter of EUR 36.3 million. The EBITDA margin related to revenue decreased from 54.1 percent in the previous year to 48.6 percent in the first quarter of 2010.
 
Rail Logistics continues to grow
Rail Logistics benefited from, among other things, a significant rise in international single wagon transports, the increase in cross-border block train traffic, and the customer contracts taken over from the company LOG-O-RAIL at the turn of the year. This was reflected by the 6.0 percent in the division’s revenue, from EUR 47.1 million in the same quarter last year to EUR 50.0 million in the first quarter of 2010. EBITDA showed an increase of 53.6 percent to EUR 2.0 million. The EBITDA margin on gross profit increased accordingly, from 36.3 percent to 50.0 percent.
 
Tank Container Logistics successfully continues on path of recovery
Already since the third quarter of 2009, the Tank Container Logistics division showed that it is on its path to recovery from the economic crisis. This development continued in the first quarter of 2010. The rise in demand spanned all regions served by the division, with particular concentration of demand in US and intra-Asian transport routes. Accordingly, revenue for the division increased by 15.0 percent, from EUR 26.8 million to EUR 30.8 million. EBITDA, at EUR 2.1 million, was 32.1 percent above the level of the previous year. The EBITDA margin on gross profit reached 41.9 percent, slightly higher than the level of the previous year of 41.2 percent.
 
Outlook for 2010
With the good results achieved in the first quarter of 2010, VTG has laid the foundation towards meeting the forecast already announced back in February. As moderate economic growth continues, the positive developments being seen in the three divisions are expected to continue. As a result of this, VTG expects revenue and operating profit for 2010 to be around the levels of 2009. 

Source: Transport Weekly