Weaker cargo volumes pressured revenues & profitability in 9M25
In 9M25, cargo volumes transported by Georgian Railway declined by 4.9% y/y to 9.8mn tons, primarily reflecting weaker transit shipments from Kazakhstan and reduced domestic transportation, partly offset by higher import volumes.
In line with the decline in transported cargo, revenues fell by 7.3% y/y to US$ 164.9mn in 9M25. The contraction was driven mainly by lower earnings from logistics services, reflecting reduced transportation of sulfur, heavy fuel and gas oil, alongside weaker revenues from freight and passenger traffic.
Adjusted EBITDA dropped sharply by 31.2% y/y to US$ 43.2mn in 9M25, as the 7.3% y/y decline in revenues was compounded by a 1.1% y/y increase in operating expenses, largely due to higher salary costs. The combined effect of weaker top-line performance and rising costs resulted in a disproportionate deterioration in operating profitability, with EBITDA margin declining to 26.2% in 9M25 from 35.3% in 9M24.
For FY2025, we expect company revenues at US$ 222.8mn, representing a 6.5% y/y decline.
