“Ukrzaliznytsia” suffers losses for the first time in a year: the reasons for the negative financial result
This situation was a consequence of the growth of exchange rates and deterioration of the structure of cargo transportation.
According to the results of work in July 2024, “Ukrzaliznytsia” is forecasting a negative financial result for the first time since the beginning of the year, despite the improvement of operational efficiency compared to last year. About this informs press service of the carrier.
Although the 40% increase in energy costs was partially offset by savings in other operating costs, the increase in exchange rates and the deterioration of the structure of cargo transportation became the main reasons for the negative financial result.
In particular, the volume of transportation of unprofitable cargoes, such as iron and manganese ore, increased significantly in July, which exceeded 3.6 million tons, which is 65% more than in July 2023. At the same time, the volume of grain transportation, an important and highly profitable cargo, decreased by 19% compared to the previous month.
In July, Ukrzaliznytsia transported 13.6 million tons of cargo, which is 12% more than in July last year. However, domestic shipments decreased by 22% to 6.4 million tons, while export shipments increased by 93% to 6.4 million tons. Import shipments increased by 39% to 746,000 tons.
During seven months of this year, “Ukrzaliznytsia” reduced fixed costs, except for the increase in electricity prices and labor costs, which are lower than the average level in Ukraine.
“Ukrzaliznytsia” advocates convergence of the cost of transportation of goods of different tariff classes. “There is no economic justification for the existence of a large difference in the cost of transporting goods of different tariff classes, because the infrastructure component (costs for infrastructure maintenance) is the same for all goods”, says the carrier’s message.
