R232 R140 G39 G196 B62 B236 R84 B83 2016 Full-Year Results ... · 3/17/2017 · 2016 Full-Year...

Definitions for terms marked in this presentation with capital letters are provided in the Appendices at pages 26-27 1

Global Ports Investments PLC

2016 Full-Year Results Presentation

17 March 2017

R140

G196

B236

R232

G39

B62

R84

G80

B83

R0

G86

B145

R151

G177

B165

R76

G158

B208

R70

G90

B80

R157

G207

B232


Information contained in this presentation concerning Global Ports Investments PLC, a company organised and existing under the laws of Cyprus

(the “Company”, and together with its subsidiaries and joint ventures, “Global Ports” or the “Group”), is for general information purposes only. The

opinions presented herein are based on general information gathered at the time of writing and are subject to change without notice. The Company

relies on information obtained from sources believed to be reliable but does not guarantee its accuracy or completeness.

These materials may contain forward-looking statements regarding future events or the future financial performance of the Group. You can identify

forward looking statements by terms such as “expect”, “believe”, “estimate”, “anticipate”, “intend”, “will”, “could”, “may”, or “might”, the negative of

such terms or other similar expressions. These forward-looking statements include matters that are not historical facts and statements regarding the

Company’s and its shareholders’ intentions, beliefs or current expectations concerning, among other things, the Group’s results of operations,

financial condition, liquidity, prospects, growth, strategies, and the industry in which the Company operates. By their nature, forward-looking

statements involve risks and uncertainties, because they relate to events and depend on circumstances that may or may not occur in the future.

The Company cautions you that forward-looking statements are not guarantees of future performance and that the Group’s actual results of

operations, financial condition, liquidity, prospects, growth, strategies and the development of the industry in which the Company operates may differ

materially from those described in or suggested by the forward-looking statements contained in these materials. In addition, even if the Company’s

results of operations, financial condition, liquidity, prospects, growth, strategies and the development of the industry in which the Company operates

are consistent with the forward-looking statements contained in these materials, those results or developments may not be indicative of results or

developments in future periods.

The Company does not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the

occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in forward-looking

statements of the Company, including, among others, general economic conditions, the competitive environment, risks associated with operating in

Russia, market change in the Russian transportation industry or particularly in the ports operation segment, as well as many other risks specifically

related to the Company and its operations.

These materials do not constitute an offer or an advertisement of any securities in any jurisdiction.

DISCLAIMER


Unless stated otherwise all financial information in this presentation is extracted from the Consolidated Financial Statements of the Company for the

twelve months period ended 31 December 2016 which are prepared in accordance with International Financial Reporting Standards adopted by the

European Union (“IFRS”) and the requirements of the Cyprus Companies Law, Cap.113.

The Global Ports Group’s Consolidated Financial Statements of the Company for the twelve months period ended 31 December 2016 is available at

the Global Ports Group’s corporate website (www.globalports.com).

The financial information is presented in US dollars, which is also the functional currency of the Company and certain other entities in the Group.

The functional currency of the Group’s operating companies for the periods under review was (a) for the Russian Ports segment, the Russian

rouble, (b) for the Oil Products Terminal segment and for the Finnish Ports segment, the Euro.

In this presentation the Group has used certain non-IFRS financial information as supplemental measures of the Group’s operating performance.

Such information is marked in this presentation with an asterisk {*}.

Information (including non-IFRS financial measures) requiring additional explanation or defining is marked with initial capital letters and the

explanations or definitions are provided at the end of this presentation.

Rounding adjustments have been made in calculating some of the financial and operational information included in this presentation. As a result,

numerical figures shown as totals in some tables may not be exact arithmetic aggregations of the figures that precede them.

Market share data has been calculated using the information published by the Association of Sea Commercial Ports (“ASOP”), www.morport.com,

Seabury Group LLC (“Seabury”) and Drewry Financial Research Services Ltd (“Drewry”).

REFERENCE TO ACCOUNTS AND OPERATIONAL INFORMATION

3


CONTENTS

4

PAGE

I. Global Ports at a glance 5

II. Continued focus on cash flow and deleveraging 6

III. Container market: 2016 volumes broadly flat 7

IV. Container export growth is a sustained trend 8

V. 2016 Operating highlights 9

VI. 2016 Financial highlights 11

VII. On-going focus on deleveraging 12

VIII. Industry outlook and strategic focus 13

Appendix #1: Global Ports Group

14

Appendix #2: Selected operational and financial information 20


The #1 container terminal operator in Russia(1)

Strong presence in both key container gateways to Russia: Baltic and the Far Eastern basins

● 6 marine container terminals in the Baltic basin and 1 in Far East basin

Efficient, well-invested terminals provide for low CAPEX requirements and high cash flow generation

Listed on the main market of the London Stock Exchange, free float of 20.5%(2)

● APM Terminals and N-Trans (each with 30.75% of total share capital) are the core strategic shareholders

● Adherence to best-in-class corporate governance

● Board of Directors with strong track record and deep understanding of the industry

GLOBAL PORTS AT A GLANCE

(1) Source: ASOP, based on 2016 overall container throughput in the Russian Federation ports

(2) Of total share capital.

BALTIC BASIN

BLACK SEA BASIN

FAR EASTERN BASIN

Vostochnaya

Stevedoring Company

MLT-Helsinki

MLT-Kotka

Vopak E.O.S. Ust-Luga

Container

Terminal

Moby Dik

First Container Terminal

Petrolesport

Logistika-Terminal

Yanino


CONTINUED FOCUS ON CASH FLOW AND DELEVERAGING

Focus on additional

revenue streams

Market volumes grew 4% in 2H 16 y-o-y resulting in 1% y-o-y growth for the full year

Continued growth in containerised export (13% y-o-y) and empty import (growth of 1.7x) to 7% of

total import driven by on-going containerisation in Russia

Competition remains strong with c. 50% utilisation rate across the industry

Signs of gradual

container market

recovery

Deleveraging remains

priority, debt portfolio

diversified

Strong cash flow

generation, focus on

efficiency

Adjusted EBITDA of USD 224 million (-23%), high Adjusted EBITDA margin of 68%

Strong cash conversion, FCF of USD 178 million, supported by low CAPEX of USD 18 million

Continued focus on operational efficiency, process optimisation and centralisation

Net Debt(1) reduced by c. USD 100 million in 2016 to USD 947 million

Successful diversification of debt portfolio, share of public debt increased to more than 80%

Dividends remain suspended

Global Ports’ full-year Consolidated Marine Container Throughput down 19% y-o-y, 3.6%

decrease in 2H 16 compared to 1H 16

Focus on additional revenue streams in order to generate better yield from existing infrastructure:

● Bulk cargo throughput up 67% y-o-y, driven mainly by coal and scrap metal

● Inland container throughput grew 58%

(1) Including derivative financial instruments


3%1%

-2%-6%

-23%

-29%-27%

-24%

-5%

1% 0.5%

7% 9%

1Q14 3Q14 1Q15 3Q15 1Q16 3Q16 Jan-Feb17 2014 2015 2016

0.5 0.7

0.9 1.1

1.5

2.0

2.4

3.0

3.7

2.4

3.5

4.5 4.9

5.2 5.1

3.78 3.82

00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16

CONTAINER MARKET: 2016 VOLUMES BROADLY FLAT

Russian container market remained broadly flat in 2016,

driven by a 1% decrease in laden imports offset by 13%

growth in laden export and 73% growth in empty imports

2Q 16 saw the first monthly container market y-o-y

increase after 7 consecutive quarters of decline

● 4Q 16 grew 7% y-oy, Jan-Feb 17: 9% y-o-y

Competition remains strong in an environment of low

capacity utilisation

● Average capacity utilisation was below 50% in 2016

Source: ASOP, Company estimates

Laden import

Russian container market

mln TEU

-31%

-1%

2.28

1.57 1.55

mln TEU

Russian container market quarterly dynamics

% YoY


2012 2013 2014 2015 20162012 2013 2014 2015 2016

2012 2013 2014 2015 2016

CONTAINER EXPORT GROWTH IS A SUSTAINED TREND

Laden exports up 22% since 2012; up 13% in 2016 supported

by ongoing containerisation

● Containerisation of export supply chains allows for

reduction of cargo losses; more flexibility and ability to

market small quantities (as little as one container) globally

Growth in exports balances Russian container flows

● Need to import empty containers is increasing the overall

market: import of empty containers was virtually non-

existent before rising to c. 7% of total import in 2016

● Export is potentially more stable compared to volatile

imports

0.5x

- Laden export/total export ratio in Saint-Petersburg area(1)

Laden export of Russia, mln TEU per annum

0.4x 0.4x

0.77 0.76

0.92

22%

Source: ASOP

(1) Saint-Petersburg and Ust-Luga

Growth in laden export is balancing Russian container market Laden exports growth drives empty containers’ import

Export growth is a sustained trend

0.94

1.05

13%

0.7x 0.8x

XX

15.6%

XX - Share of laden export in total market, %

14.8% 18.0% 24.8% 27.6%

- Imports of empty containers dynamics, kTEU XX

XX - Share of empty container import in total import (%)

17 32 33

71

122

1.5% 1.3% 0.8% 4.3% 7.3%


2015 2016

2015 20162015 2016

2015 2016

2016 OPERATING HIGHLIGHTS (1/2)

Focus on

additional

revenue

streams

improving

utilisation of

existing

infrastructure

during time of

container

market

weakness

Record volumes of Consolidated Marine

Bulk Throughput of 2.2 mln tons (+67% y-

o-y and +38% h-o-h) driven by coal in

VSC, scrap metal and other bulk export at

PLP

Rapid growth in Consolidated Inland

Container Throughput (+58%) and in

Consolidated Inland Bulk Throughput

(+11%) driven by containerisation of

exports and high quality of service

14% growth in high and heavy Ro-Ro

throughput

Despite 12%(1) decrease in car sales in

Russia and 24%(1) decrease in sales of

new imported cars, PLP handled 96

thousand cars in 2016 which is only 4.6%

lower than in 2015.

58%

110

174

Inland container

throughput, ths TEU

Bulk, ths tonnes

1326

2210

67%

Inland bulk,

ths tonnes

2015 2016

11%

273

304

14%

13 15

Ro-Ro, ths units Cars, ths units

-4.6%

101 96

(1) Source: PWC Auto report (www.pwc.ru/ru/automotive/publications/assets/automotive-market-of-russia-feb16/Auto_report_Rus.pdf)


2013 2014 2015 2016

2016 OPERATING HIGHLIGHTS (2/2)

CAPEX remains

below guidance

Total CAPEX of USD 18 million vs. mid-term

guidance of USD 25-35 million

Every CAPEX item scrutinised. As an example: two

STS cranes were relocated from PLP to VSC

instead of buying new equipment

(1) Illustrative combined basis

(2) Lost-time injury frequency rates

(3) Global Minimum Requirements

Focus on

efficiency and

safety

Ongoing analysis of business processes and

centralisation opportunities

● Commercial, procurement, IT and legal already

centralised

● Further unification of IT platform and enhancement

of IT solutions

Ongoing safety focus with significant progress

achieved:

● LTIF(2) reduced by 39% to a factor of 1.16

● Roll-out of additional safety improvements and

standards (contractor safety and Lock-Out Tag-Out)

● Increased our GMR(3) compliance to 95% across all

terminals from 76% last year.

Focus on control of costs: Total Operating Cash

Costs decreased 7% in USD terms, remained

broadly flat in RUB terms

Cash CAPEX, mln USD

18.0 23.6

-74%

70.0* (1)

11.7

Relocation of two STS cranes from Saint-

Petersburg to Far East via Northern Sea Route


2015 2016

2015 2016

2016 FINANCIAL HIGHLIGHTS

Decline in volumes impacted revenues

Adjusted EBITDA margin

remained strong

High cash conversion

Revenue

Adjusted EBITDA and Adjusted EBITDA margin

Revenue declined 18% to USD 331 million, driven

by 19% decrease in Consolidated Marine

Container Throughput

Revenue per TEU down 2%(1)

Share of non-container Revenue increased from

16% in 2015 to 19% in 2016

Adjusted EBITDA down 23% to USD 224 million

Adjusted EBITDA Margin remained strong at

68%

Strong Free Cash Flow generation due to:

● Strong operating cash flows

● Low CAPEX requirements

● Dividend flow from joint ventures

USD mln

406 331

-18%

291*

224*

-23% 72%* 68%*

USD mln

AdjustedEBITDA

Incometax

CAPEX Dividendsfrom JVs

Other FCF

5

Cash Conversion in 2016

USD mln

224*

(28) (18) (5)

178*

(1) On consolidated basis


31.12.2016 2017 2018 2019 2020 2021 2022 2023 and after

2013 2014 2015 2016

ON-GOING FOCUS ON DELEVERAGING

Source: Company data

(1) Including derivative financial instruments

Net Debt(1) reduced by c. USD 100.3 million* in 2016

Since NCC acquisition at the end of 2013:

● Total Debt(1) reduced by c. USD 396.8 million*

● Net Debt(1) reduced by c. USD 402.8 million *

As of 31 December 2016:

● Total Debt(1) was USD 1,067 million*, Net debt(1) was USD

947 million*

● Net Debt / Adjusted EBITDA of 4.2x*

● Average interest rate of the debt portfolio is around 6.7%*

● Share of public debt was more than 80%*, share of fixed rate

borrowings was almost 100%*

Consistent Net Debt(1) reduction

Debt maturity profile as of 31 December 2016

USD mln

USD mln

1208*

947*

1350*

1048*

Cash &

Equivalents

Net cash from

operating activity

in 2016

315*

196

119

61* 34* 31*

73*

166*

350* 352*


INDUSTRY OUTLOOK AND STRATEGIC FOCUS

Build on our

strengths

Efficient modern capacity available in right locations in key container gateways

High level of service, focus to increasing service levels further

Industry leader in IT solutions within Russian container industry

Industry outlook Gradual container market volume recovery, growing 9% in January-February 2017 period

50% unutilised industry capacity is intensifying pressure on prices

Continued focus

on FCF and

deleveraging

Well invested terminals enable scale down of CAPEX to USD 25-35 million per annum in the mid term

Focus on cost control, preserve cash given capacity available across the portfolio

Use strong Free Cash Flow for deleveraging

14

APPENDIX #1

Global Ports Group


STRONG POSITIONS IN KEY BASINS

RUSSIA FINLAND

ESTONIA

BALTIC SEA GULF OF FINLAND

Ust-Luga

Container

Terminal

First Container

Terminal

Petrolesport Moby Dik

RUSSIA

CHINA

SEA OF

JAPAN

Vostochnaya

Stevedoring Company

Moscow St. Petersburg

Nakhodka

Black Sea Basin

18% of Russia’s

container traffic

Shanghai

Baltic Basin

Key entry gateway to Russia

Excellent maritime access to key

consumption areas St. Petersburg

and Moscow

The cheapest route to deliver cargo

from China to European part of

Russia(1)

Far East Basin

Supplying Russian Far East, CIS

countries (Kazakhstan, Tajikistan,

Uzbekistan) as well as central

Russia (including Moscow)

The fastest route to ship cargoes

from China to Moscow: up to 15-

20 days faster than via the Baltic

Basin (1)

Baltic Basin

53% of Russia’s container

traffic

Far East Basin

27% of Russia’s

container traffic

VEOS

MLT Helsinki

MLT Kotka

Source: Based on 2016 market data by ASOP

(1) Company estimate based on public sources


WELL INVESTED CONTAINER TERMINALS IN KEY GATEWAYS

Black Sea Basin 17% of Russian market 2016 throughput

Russia

• Capacity: 440 ths. TEU

NCSP

Novorossiysk

Black

Sea

Turkey


NUTEP

Baltic Sea Basin 53% of Russian market 2016 throughput

Far East Basin 27% of Russian market 2016 throughput


VSC


VMTP

Vladivostok

Okhotsk

Sea

Russia

China Russia

Finnish transit

Baltic countries’ transit


Moby Dik

• Capacity: 1,000 ths. TEU

PLP

St. Petersburg

Region

Estonia

Latvia

Kaliningrad

Region

Baltic Sea

Lithuania


Ust-Luga


BSC and Kaliningrad SCP


FCT


CT St-Petersburg

Moscow

Finland

Other terminals


Bronka

• Capacity(1): 500 ths. TEU

Source: Drewry, open sources, Company analysis

Note: Gross container handling capacity with respect to container terminals of the Group as at 30 June 2016

(1) Source: Vedomosti as at 19.06.2015


ENLARGED BALTIC SEA BASIN


PLP


FCT • Capacity: 400 ths. TEU

Moby Dik


Ust-Luga

Bronka

• Capacity: 500 ths. TEU • Capacity: 750 ths. TEU

CT St-Petersburg


224*

178 *

EBITDA Free Cash Flow

4.2x*

- Net Debt / LTM EBITDA

PRINCIPLES OF IFRS CONSOLIDATION

Fully consolidated Accounted using equity method

Vopak EOS is a JV with Royal Vopak (Netherlands),

other JVs are with Container Finance (Finland)

Key contributors are large terminals FCT, PLP and VSC

20% of ULCT owned by Eurogate GmbH, shown as non-

controlling interest in GPI’s financial statements

mln USD, 2016 X.Xx

37*

14*

22*

EBITDA Free Cash Flow

GPI's share in Free Cash Flow-0.1x*

mln USD, 2016

36*

100% 80% 100% 100% 100% 75% 75% 75% 50%

VEOS Multi-Link

Terminals Yanino FCT PLP ULCT Moby Dik LT VSC

- Net Debt / LTM EBITDA X.Xx


OTHER SEGMENTS

Vopak E.O.S. Finnish Ports segment

Throughput, mln tons

4.9*

2.6*

-47%*

86

59

-32%*

32*

19*

-43%*

2015

2016

272*

3.9*

19.6

188* 12.9

1.5*

-31%*

-34%*

-62%*

Revenue, USDm Adjusted EBITDA

(USDm) and Adjusted

EBITDA margin (%)

Focus on storage and accumulation of large shipments,

utilising the unique features of the tank farm consisting of

78 tanks of different sizes

Market environment remains extremely challenging

Due to mandatory adoption of IFRS 11 from January 1st 2014, Vopak E.O.S., Finnish Ports segment (as well as Moby Dik and Yanino

included in the Russian Ports segment) are consolidated using the equity method of accounting and their proportional share of net

profit is reported below EBITDA

37.6%* 31.6%*

Finnish Ports segment throughput decreased by 31%*

Revenues decreased by 34%, Adjusted EBITDA by 62%*

20.2%* 11.6%*

Throughput, thousand TEU Revenue, USDm Adjusted EBITDA

(USDm) and Adjusted

EBITDA margin (%)

2015

2016

20

APPENDIX #2

Selected operational and financial information


SELECTED OPERATIONAL INFORMATION(1)

(1) Data is on a 100% basis. Source: Management accounts

(2) Total throughput of Russian Ports excludes the throughput of Yanino which in 2016 and 2015 was 115 thousand TEUs and 107 thousand TEUs respectively and the throughput of LT which in 2016 and 2015 was 174 thousand TEUs and 110

thousand TEUs respectively

2015 2016

2015 2016

Gross throughput Gross throughput

Russian Ports segment Finnish Ports segment

Containerised cargo

(thousand TEUs)

PLP 376 265

Containerised cargo (thousand

TEUs) 272 188

VSC 353 301

Moby Dik 169 155

FCT 578 480 Oil Products Terminal segment

ULCT 86 82

Total Russian Ports segment(2) 1,562 1,284

Oil products Gross Throughput

(million tonnes) 4,9 2,6

Non-containerised cargo

Ro-ro (thousand units) 13 15

Cars (thousand units) 101 96 Bulk cargo (thousand tonnes) 1,364 2,236


SELECTED OPERATIONAL INFORMATION (CONTINUED)

Source: Management Accounts

(1) As a result of the relocation of two STS cranes from PLP to VSC the capacity of PLP temporarily decreased to 750 thousand TEUs. It is expected to be restored to 1 mln TEUs in 2H 2017.

2016 2016

Capacity (end of the period)

Russian Ports segment Finnish Ports segment

Russian Marine Container Terminal Capacity

Annual container handling capacity

(Thousand TEUs)

PLP(1) 1,000 MLT Kotka 270

VSC 650 MLT Helsinki 150

Moby Dik 400 Total 420

FCT 1,250

ULCT 440

Total Global Ports 3,740

Yanino, inland container terminal


(Thousand TEUs) 200

Annual general cargo capacity (Thousand tonnes) 400 Oil Products Terminal Segment

LT, inland container terminal Storage Capacity (in thousand cbm) 1,052


(Thousand TEUs) 200


GLOBAL PORTS CONSOLIDATED INCOME STATEMENT

Source: Global Ports consolidated financial statements

Summary Income Statement

USD million 2015 2016

Revenue 405.7 331.5

Cost of sales (176.4) (186.1)

Gross profit 229.3 145.4

Administrative, selling and marketing expenses (42.3) (36.7)

Share of profit/(loss) of joint ventures 3.8 (40.4)

Other (losses)/gains – net (6.0) (68.8)

Operating profit 184.8 (0.5)

Finance income/(costs) – net (215.1) 110.3

Profit before income tax (30.3) 109.9

Income tax expense (3.4) (48.6)

Profit for the period (33.7) 61.3

Profit attributable to:

Owners of the Company (25.1) 61.0

Adjusted EBITDA* 291.0 224.3

Adjusted EBITDA Margin* 71.7% 67.7%


GLOBAL PORTS CONSOLIDATED BALANCE SHEET


Summary Balance Sheet

USD million 30-Jun-16 31-Dec-16

PP&E (incl. prepayments) 557.2 584.9

Intangible assets 699.5 666.2

Derivative financial instruments 11.3 35.5

Other non-current assets 233.3 175.9

Cash and equivalents 119.2 119.3

Other current assets 63.9 61.3

Total assets 1,684.4 1,643.0

Equity attributable to the owners of the Company 315.9 309.6

Minority interest 15.1 15.3

LT borrowings 1,058.7 1,040.9

Derivative financial instruments 2.5 -

Other non-current liabilities 169.0 170.9

ST borrowings 93.0 78.7

Other current liabilities 30.3 27.6

Total equity and liabilities 1,684.4 1,643.0


GLOBAL PORTS CONSOLIDATED CASH FLOW STATEMENT


Summary Cash Flow Statement

USD million 2015 2016

Cash generated from operations 297.3 218.7

Dividends received from joint ventures 10.4 5.3

Tax paid (59.7) (28.1)

Net cash from operating activities 248.0 195.8

Cash flow from investing activities

Purchases of intangible assets (0.1) (0.1)

Purchases of property, plant and equipment (11.7) (18.0)

Proceeds from sale of property, plant and equipment 8.7 1.0

Loans granted to related parties (8.7) (9.9)

Loans repayments received 0.5 0.4

Other 1.5 1.0

Net cash used in investing activities (9.8) (25.6)

Cash flow from financing activities

Net cash outflows from borrowings and financial leases (118.0) (95.2)

Interest paid (74.4) (79.9)

Dividends paid to the owners of non-controlling interest - (0.7)

Net cash used in financing activities (192.4) (175.9)


DEFINITIONS Adjusted EBITDA (a non-IFRS financial measure) for Global Ports Group is defined as profit for the period before income tax expense, finance (income)/costs—net, depreciation of property, plant and

equipment, amortisation of intangible assets, share of profit/(loss) of joint ventures accounted for using the equity method, other gains/(losses)—net and impairment of goodwill and property, plant and

equipment and intangible assets;

Adjusted EBITDA Margin (a non-IFRS financial measure) is calculated as Adjusted EBITDA divided by revenue, expressed as a percentage;

Baltic Sea Basin is the geographic region of northwest Russia, Estonia and Finland surrounding the Gulf of Finland on the eastern Baltic Sea, including St. Petersburg, Tallinn, Helsinki and Kotka;

Consolidated Marine Container Throughput is defined as combined marine container throughput by consolidated marine terminals: PLP, VSC, FCT and ULCT;

Consolidated Marine Bulk Throughput is defined as combined marine bulk by consolidated terminals: PLP, VSC, FCT and ULCT;

Consolidated Inland Container Throughput is defined as combined container throughput by consolidated inland terminals: LT;

Consolidated Inland Bulk Throughput is defined as combined bulk throughput by consolidated inland terminals: LT;

Container Throughput in the Russian Federation Ports is defined as total container throughput of the ports located in the Russian Federation, excluding half of cabotage cargo volumes. Respective

information is sourced from ASOP (“Association of Sea Commercial Ports”, www.morport.com).

Cash Costs of Sales (a non-IFRS financial measure) is defined as cost of sales, adjusted for depreciation and impairment of property, plant and equipment, amortisation and impairment of intangible

assets;

Cash Administrative, Selling and Marketing expenses (a non-IFRS financial measure) is defined as administrative, selling and marketing expenses, adjusted for depreciation and impairment of

property, plant and equipment, amortisation of intangible assets;

CD Holding group consists of Yanino Logistics Park (an inland terminal in the vicinity of St-Petersburg), CD Holding and some other entities. The results of CD Holding group are accounted in the

Global Ports’ financial information using the equity method of accounting;

Far East Basin is the geographic region of southeast Russia, surrounding the Peter the Great Gulf, including Vladivostok and the Nakhodka Gulf, including Nakhodka on the Sea of Japan.

First Container Terminal (FCT) is located in the St. Petersburg harbour, Russia’s primary gateway for container cargo. The Global Ports Group owns a 100% effective ownership interest in FCT. The

results of FCT are fully consolidated;

Finnish Ports segment consists of two terminals in Finland, MLT Kotka and MLT Helsinki (in port of Vuosaari), in each of which Container Finance currently has a 25% effective ownership interest. The

results of the Finnish Ports segment are accounted for in the Global Ports’ financial information using the equity method of accounting (proportionate share of net profit shown below EBITDA);

Free Cash Flow (a non-IFRS financial measure) is calculated as Net cash from operating activities less Purchase of PPE;

Functional Currency is defined as the currency of the primary economic environment in which the entity operates. The functional currency of the Company and certain other entities in the Global Ports

Group is US dollars. The functional currency of the Global Ports Group’s operating companies for the years under review was (a) for the Russian Ports segment, the Russian Rouble and (b) for the Oil

Products Terminal segment, and for the Finnish Ports segment, the Euro;

Gross Container Throughput represents total container throughput of a Group’s terminal or a Group’s operating segment shown on a 100% basis. For the Russian Ports segment it excludes the

container throughput of the Group’s inland container terminals, Yanino and Logistika Terminal;

Logistika Terminal (LT) is an inland container terminal providing a comprehensive range of container freight station and dry port services at one location. The terminal is located to the side of the St.

Petersburg - Moscow road, approximately 17 kilometres from FCT and operates in the Shushary industrial cluster. The Global Ports Group owns a 100% effective ownership interest in LT. The results of

LT are fully consolidated;


DEFINITIONS MLT group consists of Moby Dik (a terminal in the vicinity of St-Petersburg) and Multi-Link Terminals Oy (terminal operator in Vuosaari (near Helsinki, Finland) and Kotka, Finland). The results of MLT

group are accounted for in the Global Ports’ financial information using the equity method of accounting (proportionate share of net profit shown below EBITDA);

Moby Dik (MD) is located in Kronshtadt on the St. Petersburg ring road, approximately 30 kilometers from St. Petersburg, at the entry point of the St. Petersburg channel. It is the only container terminal

in Kronstadt. The Global Ports Group owns a 75% effective ownership interest in MD, Container Finance LTD currently has a 25% effective ownership interest. The results of MD are accounted for in

the Global Ports’ financial information using the equity method of accounting (proportionate share of net profit shown below EBITDA);

Net Debt (a non-IFRS financial measure) is defined as the sum of current borrowings, non-current borrowings and derivative financial instruments less cash and cash equivalents and bank deposits with

maturity over 90 days;

Oil Products Terminal segment consists of the Group’s 50% ownership interest in Vopak E.O.S. (in which Royal Vopak currently has a 50% effective ownership interest). The results of the Oil

Products Terminal segment are consolidated in the Global Ports’ financial information using the equity method of accounting (proportionate share of net profit shown below EBITDA);

Petrolesport (PLP) is located in the St. Petersburg harbour, Russia’s primary gateway for container cargo. The Group owns a 100% effective ownership interest in PLP. The results of PLP are fully

consolidated;

Ro-Ro, roll on-roll off is cargo that can be driven into the belly of a ship rather than lifted aboard. Includes cars, buses, trucks and other vehicle

Russian Ports segment consists of the Global Ports Group’s interests in PLP (100%), VSC (100%), FCT (100%), ULCT (80%) (in which Eurogate currently has a 20% effective ownership interest),

Moby Dik (75%), Yanino (75%) (in each of Moby Dik and Yanino Container Finance currently has a 25% effective ownership interest), and Logistika Terminal (100%) and some other entities. The results

of Moby Dik and Yanino are accounted for in the Global Ports’ condensed consolidated financial information using the equity method of accounting (proportionate share of net profit shown below

EBITDA);

TEU is defined as twenty-foot equivalent unit, which is the standard container used worldwide as the uniform measure of container capacity; a TEU is 20 feet (6.06 metres) long and eight feet (2.44

metres) wide and tall;

Total Debt (a non-IFRS financial measure) is defined as a sum of current borrowings, non-current borrowings and derivative financial instruments.

Total Operating Cash Costs (a non-IFRS financial measure) is defined as Global Ports Group’s cost of sales, administrative, selling and marketing expenses, less depreciation and impairment of

property, plant and equipment, less amortisation and impairment of intangible assets;

Ust Luga Container Terminal (ULCT) is located in the large multi-purpose Ust-Luga port cluster on the Baltic Sea, approximately 100 kilometres westwards from St. Petersburg city ring road. ULCT

began operations in December 2011. The Global Ports Group owns a 80% effective ownership interest in ULCT, Eurogate, the international container terminal operator, currently has a 20% effective

ownership interest. The results of ULCT are fully consolidated;

Vopak E.O.S. includes AS V.E.O.S. and various other entities (including an intermediate holding) that own and manage an oil products terminal in Muuga port near Tallinn, Estonia. The Group owns a

50% effective ownership interest in Vopak E.O.S.. The remaining 50% ownership interest is held by Royal Vopak. The results of Vopak E.O.S. are consolidated in the Global Ports’ financial information

using the equity method of accounting (proportionate share of net profit shown below EBITDA);

Vostochnaya Stevedoring Company (VSC) is located in the deep-water port of Vostochny near Nakhodka on the Russian Pacific coast, approximately eight kilometers from the Nakhodka-

Vostochnaya railway station, which is connected to the Trans-Siberian Railway. The Group owns a 100% effective ownership interest in VSC. The results of VSC are fully consolidated;

Weighted average effective interest rate is the average of interest rates weighted by the share of each loan in the total debt portfolio.

Yanino Logistics Park (YLP) is the first terminal in the Group’s inland terminal business and is one of only a few multi-purpose container logistics complexes in Russia providing a comprehensive range

of container and logistics services at one location. It is located approximately 70 kilometres from the Moby Dik terminal in Kronstadt and approximately 50 kilometres from PLP. The Global Ports Group

owns a 75% effective ownership interest in YLP, Container Finance LTD currently has a 25% effective ownership interest. The results of YLP are accounted for in the Global Ports’ financial information

using the equity method of accounting.

Definitions for terms marked in this presentation with capital letters are provided in the Appendices at pages 26-27

28 28

INVESTOR RELATIONS Mikhail Grigoriev Phone: +7 495 989 4769 (ext. 1310)

Mob: +7 916 991 7396

Yana Gabdrakhmanova Phone: +7 495 989 4769 (ext. 4197)

Mob: +7 910 462 5538

E-mail: [email protected]

Web: www.globalports.com

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