Sergei Generalov: "We're returning from the manual to the system management"
Russian transport group FESCO has overcome the crisis period largely due to ‘manual mode’ of business management. The Group’s main stockholder Sergei Generalov took the FESCO’s President Office to optimize all of the company’s units. He is developing a strategy of FESCO in the post-crisis period as well. Sergei Generalov told in a recent interview with PortNews what the lessons a Russia's largest transport holding has learned from the crisis and where the company plans to direct its investment program.
- Sergey, please tell how FESCO has overcome the world economic crisis? Has it been over for you?
- The crisis period was very difficult for all, without exception, units of the transport group FESCO: for marine, for container and for the railway, which deals not only with containerized freight, but also with bulk ones (transportation of bulk cargoes – PortNews).
By total revenues, if we take the IFRS standards (international financial reporting system - PN), in the first half of 2009 compared with the first half of pre-crisis 2008 statistics was just shocking. Revenue slumped by more than 50%, the volume of transshipment and transportation of goods fell even more. It was very hard for us. In addition, we had yet a certain level of debt burden, which was equal to the pre-crisis volumes of business, but taking into account the sharp drop in traffic, became inadequate. So, we had to negotiate with banks on restructuring, termination or changing of a number of financial covenants, which was not easy at all. Noteworthy, the Group never delayed, even a single day, any payment to both banks and counterparties.
Now the volume has nearly recovered. In some segments, even exceeded pre-crisis level. However, we almost nowhere managed to fully restore the margin. Therefore, the overall profitability of FESCO’s business still remains lower than it was before the crisis.
- What types of activities of the Group show the best results this year?
- In 2010 line services containers traffic show significantly better results. In the first eight months of the year FESCO provided transportation for more than 190,000 TEUs of exports, a quarter higher than in 2009. However, today's results are still below pre-crisis level. In eight months of 2008, our services carried 295,000 TEUs of containerized cargo.
Our coastal traffic results are still lower than in 2008, but not so much. Short sea trade lines of FESCO from January to August this year carried more than 43,000 TEUs of containerized cargo, which is 14% lower than the same period of the pre-crisis years. Inland traffic volume did not drop so much as foreign trade, thanks largely to the Northern delivery.
Container rail traffic even exceeded those of 2008. If in the reporting period before the crisis, we had provided transporting by railroad of over 80,000 TEUs, in the current year we have already exceeded the amount of 114,000 TEUs. This is due to active restoration of imports. Luckily, this trend continues.
As for the rail transportation of bulk cargoes, which make up a considerable part of our business, it also fell significantly in 2009 - by 30%. This year we have been substantially higher than last year’s volume in terms of traffic volume. Freight volume loaded at railroad for the eight months of 2010 totaled 16.2 million tons, a 35-percent gain over the same period in 2009. We are talking about coal, metal and rubble. We have a fairly diversified fleet of railcars, so we do not depend on a particular type of cargo.
In the crisis period it was transportation of coal that turned to be a great help.
- Sergey, please tell how FESCO has overcome the world economic crisis? Has it been over for you?
- The crisis period was very difficult for all, without exception, units of the transport group FESCO: for marine, for container and for the railway, which deals not only with containerized freight, but also with bulk ones (transportation of bulk cargoes – PortNews).
By total revenues, if we take the IFRS standards (international financial reporting system - PN), in the first half of 2009 compared with the first half of pre-crisis 2008 statistics was just shocking. Revenue slumped by more than 50%, the volume of transshipment and transportation of goods fell even more. It was very hard for us. In addition, we had yet a certain level of debt burden, which was equal to the pre-crisis volumes of business, but taking into account the sharp drop in traffic, became inadequate. So, we had to negotiate with banks on restructuring, termination or changing of a number of financial covenants, which was not easy at all. Noteworthy, the Group never delayed, even a single day, any payment to both banks and counterparties.
Now the volume has nearly recovered. In some segments, even exceeded pre-crisis level. However, we almost nowhere managed to fully restore the margin. Therefore, the overall profitability of FESCO’s business still remains lower than it was before the crisis.
- What types of activities of the Group show the best results this year?
- In 2010 line services containers traffic show significantly better results. In the first eight months of the year FESCO provided transportation for more than 190,000 TEUs of exports, a quarter higher than in 2009. However, today's results are still below pre-crisis level. In eight months of 2008, our services carried 295,000 TEUs of containerized cargo.
Our coastal traffic results are still lower than in 2008, but not so much. Short sea trade lines of FESCO from January to August this year carried more than 43,000 TEUs of containerized cargo, which is 14% lower than the same period of the pre-crisis years. Inland traffic volume did not drop so much as foreign trade, thanks largely to the Northern delivery.
Container rail traffic even exceeded those of 2008. If in the reporting period before the crisis, we had provided transporting by railroad of over 80,000 TEUs, in the current year we have already exceeded the amount of 114,000 TEUs. This is due to active restoration of imports. Luckily, this trend continues.
As for the rail transportation of bulk cargoes, which make up a considerable part of our business, it also fell significantly in 2009 - by 30%. This year we have been substantially higher than last year’s volume in terms of traffic volume. Freight volume loaded at railroad for the eight months of 2010 totaled 16.2 million tons, a 35-percent gain over the same period in 2009. We are talking about coal, metal and rubble. We have a fairly diversified fleet of railcars, so we do not depend on a particular type of cargo.
In the crisis period it was transportation of coal that turned to be a great help.
- The coal cargo damages rail cars, doesn’t it?
- It is not the coal that damages cars, but an open loading method applied at ports. However, our railroad authorities do not much complain about it.
- How the Group's stevedoring business functioned during the crisis and what are the industry prospects today?
- Stevedoring companies of the Group - Commercial Port of Vladivostok (CPV) and Vladivostok Container Terminal (VCT) deal with the activity that was least affected during the crisis. And today, the growth of the port business is very good. During the eight months of this year the transshipment of containers at the VCT was nearly 187,000 TEUs, versus slightly over 123,000 TEUs last year, and in 2008 - more than 156,000 TEUs. Transshipment at cargo berths of CPV compared with pre-crisis year rose 13% and totaled in January-August 2010 4,65 million tons. I think that for the year there will be more than 7 million tons of cargo, and it certainly is a very good result.
But it should be noted that the increase of handled volume doesn’t mean income growth compared with the year 2008! I emphasize again, that a significant increase in freight turnover does not always accompanied by margin growth. So far, the proportion of income per ton of cargo handled at the port has been less than in the pre-crisis period, but much better than last year.
- Why does this happen this way?
- In the crisis, it "unexpectedly" turned out that there is a significant excess in transport capacities, at a much lower volume of cargo available for shipment. This is also true for as well for the railway business, as for port and marine transportation. Accordingly, all companies operating in the transport sector had to reduce their capacities (cutting, for example, the old ships for scrap) and cut down their services cost so to load somehow the existing facilities.
There were some cases, when time charter rate for a large bulk carrier toppled by 20 times during the crisis! FESCO has no large sea-going bulk carriers, but our time-charter rates for dry bulk fleet were receding heavily.
- It is not the coal that damages cars, but an open loading method applied at ports. However, our railroad authorities do not much complain about it.
- How the Group's stevedoring business functioned during the crisis and what are the industry prospects today?
- Stevedoring companies of the Group - Commercial Port of Vladivostok (CPV) and Vladivostok Container Terminal (VCT) deal with the activity that was least affected during the crisis. And today, the growth of the port business is very good. During the eight months of this year the transshipment of containers at the VCT was nearly 187,000 TEUs, versus slightly over 123,000 TEUs last year, and in 2008 - more than 156,000 TEUs. Transshipment at cargo berths of CPV compared with pre-crisis year rose 13% and totaled in January-August 2010 4,65 million tons. I think that for the year there will be more than 7 million tons of cargo, and it certainly is a very good result.
But it should be noted that the increase of handled volume doesn’t mean income growth compared with the year 2008! I emphasize again, that a significant increase in freight turnover does not always accompanied by margin growth. So far, the proportion of income per ton of cargo handled at the port has been less than in the pre-crisis period, but much better than last year.
- Why does this happen this way?
- In the crisis, it "unexpectedly" turned out that there is a significant excess in transport capacities, at a much lower volume of cargo available for shipment. This is also true for as well for the railway business, as for port and marine transportation. Accordingly, all companies operating in the transport sector had to reduce their capacities (cutting, for example, the old ships for scrap) and cut down their services cost so to load somehow the existing facilities.
There were some cases, when time charter rate for a large bulk carrier toppled by 20 times during the crisis! FESCO has no large sea-going bulk carriers, but our time-charter rates for dry bulk fleet were receding heavily.
- What part of your business was the most difficult to survive in the crises time? What had contributed to the success of the Group?
- The hardest thing for us was a decline in container traffic, especially by railroad. The daily profitability per flatcars shrank during the time by fourfold: from 1,200 rubles a day to 200-250 r/d in the height of crisis. Now this figure has grown to approximately 930 rubles a day.
We have managed to keep our business just because we had few supporting points - this is a shipping and port business, in addition to rail transportation.
I am confident that the strategy itself and the structure of the established group have become a major factor in our success in overcoming the crisis period. And only the next to it I would point to the human factor, including manual management of the business.
Not all consequences of the crisis have been resolved so far. The main thing – the volume has been restored. The profitability is growing slower, but it is.
- Economic recovery entails an active investment process. Are you ready for new investments?
- Now we revamping the investment program. In particular this applies to investments in container terminals: not only marine but also onshore (rail). This is a top priority in the strategy of FESCO.
The second direction of our investments is the railway business. We are interested to invest in building new rail cars, not only the gondolas, but also, for example, fitting platforms. Their profitability in the near future should edge the level when it becomes profitable to buy them. We want to have the most effective new fleet of rail cars. Therefore, we have entered into a general agreement with Tikhvin railcar plant, which starts building rolling stock using the state-of-the-art U.S. technology. I believe that through better service and better fleet we could boost significantly our market share in the long term.
The third investment area is ships fleet. It shrank during the crisis. A few outdated ships were scrapped, and some of the nonearning fleet was sold. This does not mean that we are not going to build a new fleet. The following year, FESCO will take delivery from China 4 large (57,000dwt each) bulk carriers. Evidently, this will greatly strengthen our position on the market of Russian commodity goods traffic. We are talking about coal, fertilizers. In the long term we plan to carry domestic grain as well. In line with our strategy, FESCO will seek more and more independently operate its fleet, not to transfer the ships for charter to third parties.
- The hardest thing for us was a decline in container traffic, especially by railroad. The daily profitability per flatcars shrank during the time by fourfold: from 1,200 rubles a day to 200-250 r/d in the height of crisis. Now this figure has grown to approximately 930 rubles a day.
We have managed to keep our business just because we had few supporting points - this is a shipping and port business, in addition to rail transportation.
I am confident that the strategy itself and the structure of the established group have become a major factor in our success in overcoming the crisis period. And only the next to it I would point to the human factor, including manual management of the business.
Not all consequences of the crisis have been resolved so far. The main thing – the volume has been restored. The profitability is growing slower, but it is.
- Economic recovery entails an active investment process. Are you ready for new investments?
- Now we revamping the investment program. In particular this applies to investments in container terminals: not only marine but also onshore (rail). This is a top priority in the strategy of FESCO.
The second direction of our investments is the railway business. We are interested to invest in building new rail cars, not only the gondolas, but also, for example, fitting platforms. Their profitability in the near future should edge the level when it becomes profitable to buy them. We want to have the most effective new fleet of rail cars. Therefore, we have entered into a general agreement with Tikhvin railcar plant, which starts building rolling stock using the state-of-the-art U.S. technology. I believe that through better service and better fleet we could boost significantly our market share in the long term.
The third investment area is ships fleet. It shrank during the crisis. A few outdated ships were scrapped, and some of the nonearning fleet was sold. This does not mean that we are not going to build a new fleet. The following year, FESCO will take delivery from China 4 large (57,000dwt each) bulk carriers. Evidently, this will greatly strengthen our position on the market of Russian commodity goods traffic. We are talking about coal, fertilizers. In the long term we plan to carry domestic grain as well. In line with our strategy, FESCO will seek more and more independently operate its fleet, not to transfer the ships for charter to third parties.
- Are you planning to carry only Russian cargo, and will your fleet fly under the Russian flag?
- I want to note that we are probably among the Russian sea shipping companies have the largest fleet sailing under the Russian flag. More than half of the fleet of the Far Eastern Shipping Company (FESCO), included in the FESCO Group, or, of 52 ships 34 are Russian-flagged ones. This is due to many factors, including that we are actively engaged in the Northern delivery and domestic trade. Will the vessels operating on the world market, operate under Russian flag, is largely dependent on the Russ. Gov’t and lawmakers, who are now actively working on amendments to various legislative acts designed to improve the competitiveness of owners of Russian-flagged fleet.
- You are looking at the Northern Sea Route as a promising region for transport?
- Northern Sea Route is now (not only in the long term) a very interesting shipping lane for our Group. We are now carring freight from the Russian Far East ports to the port of Pevek. In addition, we fully arrange ice pilotage in the Eastern Arctic. We lease the state icebreakers fleet under investments terms.
We plan to upgrade the fleet of the Arctic multi-purpose vessels that are quite outdated. Remaining resources for their efficient work is about 4-6 years. Under such a shipbuilding program, we will certainly consider the involvement of enterprises of the United Shipbuilding Corporation (USC). It would not be reasonable for USC to compete with the Chinese and S.Korean rivals in a segment of ordinary vessels (such as bulkers and container carriers), and as far as I know, they (USC) do not plan to do this. But in building of the specialized Arctic fleet, where only a handful of counties, including Norway, Finland and Russia who are experience in building such vessels, I think that the USC’s position is very good. Therefore, we are working on our shipbuilding program in the first place, bearing in mind the partnership with USC in terms of creating multi-purpose Arctic vessels. We’ll make the decision in 2011-2012, taking into account the actual development of the two shipbuilding projects, which had been announced by the United Shipbuilding Corp. in the Far East Chazhma and Bolshoi Kamen (Big Stone). However, we may place our order at other shipyards of USC. As the Far East company, we would certainly be willing to give priority to our fellow-countrymen.
- What do you think about the outlook of the bill on support for shipbuilding and shipping in Russia?
- We keep an eye on this bill. Moreover, through the Union of Russian Shipowners (SOROSS) we are trying to lobby the interests of shipowners. Of course, we understand that there are currently good opportunities for USC’s projects, and it was not associated only with the political will or direct federal support for the Corporation. It is a global trend and the Russian shipbuilding industry that contributes as a whole to business development of the Shipbuilding Corp.
Let me explain. Why do so many shipping companies prefer to build their fleet at foreign shipyards? The main advantage of foreign shipyards have always been not only the quality and terms of construction, but also opportunities for the shipowner to get under the shipbuilding project a very cheap and long-term loans and, accordingly, to bring them back from the operation of new vessels. Now, as a result of the economic crisis, the interest in the financing of shipping fell several times. The number of banks, which generally continues to fund shipbuilding projects, declined three times. Those financial institutions that remain on the market, tend to be very cautious considering new contracts. Therefore, for many owners to get loans to build ships at foreign shipyards have ceased to be so accessible and become a lot more expensive.
In Russia, it is important not only to make the work of USC’s shipbuilding assets more efficient, but to ensure the possibility of relatively cheap financing of shipbuilding orders as well. Undoubtedly, this funding is possible with participation of the state. Such measures will be far greater incentive to build the fleet in Russia, than directive commands from the government. It is an economic stimulus that actually works.
- What are your ambitions in the development of container stevedoring business?
- The Group has already had money for this kind of investments. Therefore, we consider all possible offers.
This is especially true of the Far East, where we plan to expand the existing container facilities. This November, a big shipment of machinery is expected at VCT, which can boost the terminal efficiency in transshipment of containers to the railway. At the same time, within the supervisory Board of CPV we discuss a Vladivostok’s container facilities development project. With our partner, OJSC RZD (Russian Railways) we are negotiating the construction of a marine terminal of "Russian Troika" company. The three projects I have mentioned are a priority for us. On the projects basis we are building not only the stevedoring business, but serious logistical solutions for our clients. This means the direct delivery of cargo through the territory of Russia, for example, from Finland to Shanghai, or from Shanghai to Moscow and St. Petersburg. Therefore, to ‘eliminate bottlenecks’ in the Far East – is for us the number one priority.
- What about Russian Railways’ ‘bottlenecks’?
- There are no serious obstacles for the traffic growth through the Trans-Siberian railroad, say, up to 500,000 TEUs! Large amounts will, of course, require ‘elimination of the bottlenecks’. There is a corresponding program of RZD “TransSib in 7 days”, which provides for the ‘elimination’, those technological constraints that we have. This program includes funds for the development of the Trans-Siberian Railroad for the period 2009-2012. Therefore, we have no doubts that this will be done. We are more concerned about the development of the Vladivostok station’s traffic capacity.
I am confident that our investment and coordinated with them investments of OJSC RZD - is the key to success. On this basis, we can greatly boost the volume of traffic.
- Are you planning to increase the number of shipping lines too?
- We attract seaborne container flows to Vladivostok at the expense of a reliable train services. There are many cases, when containers are carried from other terminals, from the other side of the Golden Horn Bay in Vladivostok, and load the cargo to our Vladivostok-Moscow-bound train FESCO, which now runs 4 days a week. Soon we will launch the fifth train. We are ‘boosting up’ Vladivostok as a hub for shipping lanes container flows to the Trans-Siberian Railroad.
As for our own shipping services in the Far East, the first thing FESCO plans to do is the increase not of the lines number but the number and tonnage of ships on the existing ones, that are doing now. In the last three quarters of this year, we have increased the total capacity of the fleet on the Chinese service by 70%, from 3500 TEUs to 5900 TEUs, and on the S.Korean service – twice as much. In December of this year, a new FESCO’s container carrier, of over 3,000TEUs capacity, the largest Russian container ship will start operating on our Chinese service. This will help to serve the dramatically increased cargo volumes. We acquired this container before the crisis, and managed with great difficulty to save it during the crisis.
- Can you forecast container throughput at your container terminals in the Far East?
- We expect that the container volume at our three container terminals ("Russian Troika", VCT, and two berths in CPV) will be around 600-650 thousand TEUs a year in 2015-2017. Today the figure is about 260 thousand TEUs a year. This is a good pace for Vladivostok. Railroad will not be able to handle larger volumes without revolutionary changes.
- Are you interested in stevedore business in other regions of Russia?
- We are basically interested in Novorossiysk, and we might return to the stevedoring business in this region. In addition, we are eyeing various projects in the Northwest. It is not excluded that we will, alone, or in a different, more comfortable, partner combinations, enter into a project in the region.
- Manual management of the Group was introduced by you during the crisis. Will you change anything now when the crisis has been over?
- We are gradually returning from manual management to the system one. I really hope that after the next stockholders' meeting of FESCO, I'll turn over the President office to someone and will remain Chairman of the Board of Directors. I will continue to be responsible for strategy, just like before.
Interviewed by Nadezhda Malysheva.
- I want to note that we are probably among the Russian sea shipping companies have the largest fleet sailing under the Russian flag. More than half of the fleet of the Far Eastern Shipping Company (FESCO), included in the FESCO Group, or, of 52 ships 34 are Russian-flagged ones. This is due to many factors, including that we are actively engaged in the Northern delivery and domestic trade. Will the vessels operating on the world market, operate under Russian flag, is largely dependent on the Russ. Gov’t and lawmakers, who are now actively working on amendments to various legislative acts designed to improve the competitiveness of owners of Russian-flagged fleet.
- You are looking at the Northern Sea Route as a promising region for transport?
- Northern Sea Route is now (not only in the long term) a very interesting shipping lane for our Group. We are now carring freight from the Russian Far East ports to the port of Pevek. In addition, we fully arrange ice pilotage in the Eastern Arctic. We lease the state icebreakers fleet under investments terms.
We plan to upgrade the fleet of the Arctic multi-purpose vessels that are quite outdated. Remaining resources for their efficient work is about 4-6 years. Under such a shipbuilding program, we will certainly consider the involvement of enterprises of the United Shipbuilding Corporation (USC). It would not be reasonable for USC to compete with the Chinese and S.Korean rivals in a segment of ordinary vessels (such as bulkers and container carriers), and as far as I know, they (USC) do not plan to do this. But in building of the specialized Arctic fleet, where only a handful of counties, including Norway, Finland and Russia who are experience in building such vessels, I think that the USC’s position is very good. Therefore, we are working on our shipbuilding program in the first place, bearing in mind the partnership with USC in terms of creating multi-purpose Arctic vessels. We’ll make the decision in 2011-2012, taking into account the actual development of the two shipbuilding projects, which had been announced by the United Shipbuilding Corp. in the Far East Chazhma and Bolshoi Kamen (Big Stone). However, we may place our order at other shipyards of USC. As the Far East company, we would certainly be willing to give priority to our fellow-countrymen.
- What do you think about the outlook of the bill on support for shipbuilding and shipping in Russia?
- We keep an eye on this bill. Moreover, through the Union of Russian Shipowners (SOROSS) we are trying to lobby the interests of shipowners. Of course, we understand that there are currently good opportunities for USC’s projects, and it was not associated only with the political will or direct federal support for the Corporation. It is a global trend and the Russian shipbuilding industry that contributes as a whole to business development of the Shipbuilding Corp.
Let me explain. Why do so many shipping companies prefer to build their fleet at foreign shipyards? The main advantage of foreign shipyards have always been not only the quality and terms of construction, but also opportunities for the shipowner to get under the shipbuilding project a very cheap and long-term loans and, accordingly, to bring them back from the operation of new vessels. Now, as a result of the economic crisis, the interest in the financing of shipping fell several times. The number of banks, which generally continues to fund shipbuilding projects, declined three times. Those financial institutions that remain on the market, tend to be very cautious considering new contracts. Therefore, for many owners to get loans to build ships at foreign shipyards have ceased to be so accessible and become a lot more expensive.
In Russia, it is important not only to make the work of USC’s shipbuilding assets more efficient, but to ensure the possibility of relatively cheap financing of shipbuilding orders as well. Undoubtedly, this funding is possible with participation of the state. Such measures will be far greater incentive to build the fleet in Russia, than directive commands from the government. It is an economic stimulus that actually works.
- What are your ambitions in the development of container stevedoring business?
- The Group has already had money for this kind of investments. Therefore, we consider all possible offers.
This is especially true of the Far East, where we plan to expand the existing container facilities. This November, a big shipment of machinery is expected at VCT, which can boost the terminal efficiency in transshipment of containers to the railway. At the same time, within the supervisory Board of CPV we discuss a Vladivostok’s container facilities development project. With our partner, OJSC RZD (Russian Railways) we are negotiating the construction of a marine terminal of "Russian Troika" company. The three projects I have mentioned are a priority for us. On the projects basis we are building not only the stevedoring business, but serious logistical solutions for our clients. This means the direct delivery of cargo through the territory of Russia, for example, from Finland to Shanghai, or from Shanghai to Moscow and St. Petersburg. Therefore, to ‘eliminate bottlenecks’ in the Far East – is for us the number one priority.
- What about Russian Railways’ ‘bottlenecks’?
- There are no serious obstacles for the traffic growth through the Trans-Siberian railroad, say, up to 500,000 TEUs! Large amounts will, of course, require ‘elimination of the bottlenecks’. There is a corresponding program of RZD “TransSib in 7 days”, which provides for the ‘elimination’, those technological constraints that we have. This program includes funds for the development of the Trans-Siberian Railroad for the period 2009-2012. Therefore, we have no doubts that this will be done. We are more concerned about the development of the Vladivostok station’s traffic capacity.
I am confident that our investment and coordinated with them investments of OJSC RZD - is the key to success. On this basis, we can greatly boost the volume of traffic.
- Are you planning to increase the number of shipping lines too?
- We attract seaborne container flows to Vladivostok at the expense of a reliable train services. There are many cases, when containers are carried from other terminals, from the other side of the Golden Horn Bay in Vladivostok, and load the cargo to our Vladivostok-Moscow-bound train FESCO, which now runs 4 days a week. Soon we will launch the fifth train. We are ‘boosting up’ Vladivostok as a hub for shipping lanes container flows to the Trans-Siberian Railroad.
As for our own shipping services in the Far East, the first thing FESCO plans to do is the increase not of the lines number but the number and tonnage of ships on the existing ones, that are doing now. In the last three quarters of this year, we have increased the total capacity of the fleet on the Chinese service by 70%, from 3500 TEUs to 5900 TEUs, and on the S.Korean service – twice as much. In December of this year, a new FESCO’s container carrier, of over 3,000TEUs capacity, the largest Russian container ship will start operating on our Chinese service. This will help to serve the dramatically increased cargo volumes. We acquired this container before the crisis, and managed with great difficulty to save it during the crisis.
- Can you forecast container throughput at your container terminals in the Far East?
- We expect that the container volume at our three container terminals ("Russian Troika", VCT, and two berths in CPV) will be around 600-650 thousand TEUs a year in 2015-2017. Today the figure is about 260 thousand TEUs a year. This is a good pace for Vladivostok. Railroad will not be able to handle larger volumes without revolutionary changes.
- Are you interested in stevedore business in other regions of Russia?
- We are basically interested in Novorossiysk, and we might return to the stevedoring business in this region. In addition, we are eyeing various projects in the Northwest. It is not excluded that we will, alone, or in a different, more comfortable, partner combinations, enter into a project in the region.
- Manual management of the Group was introduced by you during the crisis. Will you change anything now when the crisis has been over?
- We are gradually returning from manual management to the system one. I really hope that after the next stockholders' meeting of FESCO, I'll turn over the President office to someone and will remain Chairman of the Board of Directors. I will continue to be responsible for strategy, just like before.
Interviewed by Nadezhda Malysheva.