Consolidation of the Controlling Stake in NCSP

In September 2018, the Group acquired 50% of the authorised capital of Omirico Limited, which had indirect control over 50.1% of shares of NCSP (Novorossiysk Commercial Sea Port). As a result of the acquisition, the Group’s effective share in NCSP grew from 37.07% to 63.08% (according to IFRS), the Group having thus gained control over NCSP and its subsidiaries. In January 2019, the controlling stake in NCSP, amounting to 50.1%, was transferred to direct ownership of Transneft.

As NCSP Group has its terminals at the key transit points for exported and imported cargoes on the Black and the Baltic Sea, it allows for benefitting from the growing demand for cargo transshipment to all destinations. In terms of turnover, NCSP Group’s ports are No. 1 in Russia and No. 3 in Europe, after Rotterdam and Antwerp.

In 2018, NCSP Group’s turnover amounted to 140.2 million tonnes. Against the background of a decrease in transshipment of crude oil by 11.4% due to redistribution of exports of oil from the West to the East, the Group was able to increase transshipment of grain (+14.3%) and petroleum products (+9.7%). The freight turnover of ferrous metals and cast iron grew by 13% due to the increase in delivery to Europe and Southeast Asia; transshipment of other cargoes increased substantially (+109.6%).

According to 2018 results, the market share of NCSP Group amounted to 17% of the cumulative turnover of all sea ports in Russia. Transshipment of 80 cargo types in the interests of more than 300 cargo owners took place at NCSP Group’s terminals. The unique geographic footprint allowed for getting involved in all the key north-west and south directions of Russia’s foreign trade.

NCSP Group maintained leadership in the key stevedoring services’ markets in the Russian port industry, with the following transshipment results: 26% for crude oil, 23% for petroleum products, 44% for ferrous metals and cast iron, 36% for ore and iron ore concentrate, 28% for non-ferrous metals and 23% for grains.

Due to the increased efficiency of the stevedoring business, NCSP Group’s consolidated revenue under IFRS grew by 5.7% in 2018 and achieved USD 951.3 million. NCSP Group’s EBITDA grew by 2.4% to USD 669.4 million. At year-end, the net debt reduced by 21.5% to USD 230.7 million.

At year-end 2018, the net debt to EBITDA ratio went down to 1.26 versus 1.64 in 2017.

Key Indicators of NCSP
Indicator 2017 2018 Change
Turnover, million tonnes 143.5 140.2 –2.3%
Revenue, USD million 899.8 951.3 +5.7%
EBITDA, USD million 653.7 669.4 +2.4%
Net debt, USD million 1,074.9 844.2 –21.5%
Net debt / EBITDA 1.6 1.3
NCSP’s Advantages
The Baltic Sea Basin The Azov - Black Sea Basin
NCSP Group’s share in 2018 is 22% NCSP Group’s share in 2018 is 31%
  • Crossing of European transport corridors
  • Developed infrastructure
  • Direct access to Central Russia
  • One of the leaders in the transshipment of liquid bulk cargoes in the region
  • Crossing of intercontinental trade routes
  • Year-round navigation
  • Container cargo export
  • Second largest region of oil and petroleum products export

Access to markets:

  • North-Western Europe
  • North America

Access to markets:

  • Mediterranean countries
  • India
  • Southeast Asia
  • Middle East
  • Africa
  • Central and South America
NCSP Group’s market share in cargo transshipment through sea ports of Russia in 2018