Novorossiysk Commercial Seaport group restructuring its debt


The Novorossiysk Commercial Seaport group (NCSP) has several options for restructuring its debt on the seven-year loan of USD 1.9 billion it obtained from Sberbank in early 2011 for purchasing the Primorsk merchant seaport. The group’s deputy general director for finance and economics German Kachan announced this August 29.

According to Kachan, all the options provide for reduction of the covenants and the fixed interest rate (7.48% under the agreement with Sberbank), as well as revision of the schedule of payments on the loan. However, the NCSP must repay the bank by 2018, he said. It is unknown when a final agreement will be reached.

The grace period for payment of the debt expires in early 2014, according to materials from the port. The loan agreement stipulates that the NCSP’s payments should increase significantly from next year, but the port’s revenue has been falling since the beginning of the year. This is due to the reduction of the volume of transshipment of goods by 11.6% to 72.1 million tons in the first six months of 2013. The biggest falls during this period were in transshipment of crude oil (by 16.3% to 47.8 million tons) and grain (by 88.6% to 477,000 tons).

The NCSP’s top management is forecasting for 2013 transshipment volumes of 95 million tons of crude oil (16.6% less than in 2012) and 4.9 million tons of corn (-75%). The forecast for the net debt/EBITDA ratio in 2013 has been lowered from 2.9 to 3.5, said Kachan. As of June 30, the NCSP's debt amounted to RUB 2.1 billion (including USD 332 million in short-term loans).

The Novorossiysk Commercial Seaport group is owned by a joint venture established by the Summa Group and the Transneft company. It is the largest stevedoring group in Russia and the third largest in terms of cargo turnover in Europe.

Adapted from cfts.org.ua

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