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ČD Cargo Increases Its Share in the Domestic and European Transport Market

ČD Cargo, a. s., the largest subsidiary of České dráhy, a.s. and a member of ČD Group, which is engaged in rail freight transport, realized the pre-tax profit of 620 million CZK according to the International Financial Reporting Standards (IFRS) for the first half of 2018.

The net after-tax profit of 350 million CZK was the contribution of the segment of freight transport to the consolidated result of ČD Group.

In the first half of this year ČD Cargo Group transported under its own licences a total of 33.5 million tons of goods, which is 1.3 million tons more than for the same period of last year.

"In the domestic transport market we managed to increase our market share by 3% on a year-on-year basis. The currently available statistics indicate that such a volume progress was not reached by any of our competitors. At the same time, a positive trend of growing volumes of the transport by ČD Cargo continues in Poland, and our trains can also be seen more frequently in Austria, Germany and other countries. The active business policy and foreign expansion of the brand ČD Cargo, which are the fundamental pillars of our long-term strategy, contributed to a year-on-year increase of sales from our major business activity by 330 million CZK," says the chairman of the board of directors of ČD Cargo, a.s., Ivan Bednárik.

This has been achieved despite the fact that the results of ČD Cargo have been affected by a stronger CZK/EUR exchange rate and by the growth of power and diesel oil prices, which was partially compensated by savings of other costs. In accordance with the concept of renewal and sustainability of the railway rolling-stock, the company invested large sums in the renewal, modernization and maintenance of its locomotives and freight wagons.

Ivan Bednárik adds: "In recent months we’ve done a lot of hard work and entered into a large number of significant contracts to fulfil this concept. This includes e.g. the purchase of electric interoperable locomotives Vectron and Traxx MS3 and purchase of flat wagons and tank wagons. We’ve also been strengthening the numbers of high-sided wagons, where a half of the total number of 1 000 units is modernized and the other half is purchased as new units. We will also modernize our most widespread diesel locomotives of series 742, and we also want to buy several modern locomotives for shunting and light rail service. As a matter of priority, we’ve also been implementing the ETCS system, currently helping SŽDC with its testing in the corridor and finalizing tenders for equipping our locomotives with this European system."

Considering the planned volume of investments, we also need to secure sufficient external financing. ČD Cargo made use of the current favourable conditions in financial markets and issued seven-year bonds in the nominal value of 1 billion CZK on 20 July 2018. "We are ready to invest considerable funds in our core business even at the cost of lower economic results in the following years, because these are investments in our competitiveness and in the future of the rail freight transport as such," adds the chairman of the board of directors.



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ČD Cargo

It offers the transport of a wide array of goods ranging from raw materials to products with a high added value, transport of containers, special consignment, rental of railway wagons, railway siding services, and other transport services.