10 October 2011
Kryukiv Wagon (UX: KVBZ UK, BUY) reduced production by 3x y-o-y to five passenger railcars in 9M11, Interfax reported on Friday. The company has not produced any passenger railcars since April 2011. Vitaly Gorovoy: The announced results are generally in line with our expectations of around 21 units in 2011E, down 45% y-o-y. We expect Kryukiv Wagon to still produce 12 units for Kazakhstan and four units for Belarus by yearend, according to signed contracts. In monetary terms, we estimate revenue from sales of passenger railcars to reach USD 16 mln this year, down 41% y-o-y. We believe the losses in passenger railcar output will be compensated by freight railcar production, putting overall revenue up 57% y-o-y to USD 864 mln in 2011E.