Overall first-half profit rose 26%, with net income at $58m, on combined revenues of $614m, up 62% year-on-year.

Fesco is Russia’s third-largest shipowner, with a fleet of 67 ships, including 26 container vessels. The company noted a “marked deterioration” in the maritime transport sector. “The economic crisis has also led to significant reductions in demand for transportation services and freight rates. It is not yet certain how sustained this downturn will prove to be.”

Management had yet to complete an assessment of how this would impact future cash flows. “However, it is possible that this reassessment, once completed, will result in a significant reduction or the complete elimination of goodwill.” But the company has focused on diversifying beyond its traditional shipping base and is moving aggressively into intermodal transportation, as well as terminal operations. Profits from these sectors were larger than Fesco’s shipping division, with its intermodal and liner division contributing $73.3m to profits, railway services $48.7m, and container terminals $71.6m.

Fesco is controlled by former energy minister Sergei Generalov via Industrial Investors Group, which has an 82% stake. About 15% is floated on the Russian stock exchange, with Swedish East Capital Asset Management holding 8.2%. Fesco has a 50% share in National Container Co which operates the country’s largest container terminal at St Petersburg and also has operations in the Black Sea and Ukraine. The NCC joint venture contributed a net result of $32.7m.

Lloyd’s List