Despite the challenging circumstances arising from the war, regular attacks on infrastructure, and constant risks to employees, Ukrzaliznytsia is demonstrating a confident trend towards the recovery of passenger transportation. In the past year, 65.7 million passengers used railway services, which is one million more than in 2023. This marks the second consecutive year of growth, following a significant decline in 2022, when transportation volumes dropped to 57.4 million due to the full-scale aggression of the Russian Federation.
This is reported by Business • Media
Passenger Flow Dynamics and Financial Results
Before the large-scale invasion, Ukrzaliznytsia transported over 150 million passengers annually. Specifically, the average figure from 2016 to 2019 was 161 million people. In 2020, the number of transports decreased to 68.3 million due to the pandemic, and in 2022, due to military actions. However, even under these extraordinary conditions, the railway remained a key means of evacuating the population, with at least 4 million evacuated citizens using it in 2022.
“The main reason for the losses is the tariffs. In Ukraine, passenger transportation does not cover costs, so it is subsidized by freight revenues.”
Losses and Eurobond Obligations
The financial result for Ukrzaliznytsia in the past year was a loss of 2.71 billion hryvnias. In comparison, in 2023, the company recorded a profit of 5 billion hryvnias. In the first year of the pandemic, losses amounted to nearly 12 billion hryvnias, and in the first year of the full-scale war, 9.6 billion hryvnias. The reason for the losses remains the low tariffs for passenger transportation, which do not cover expenses, thus they are financed from profits from freight transportation.
At the same time, the company confirmed its readiness to fulfill its obligations to investors. In particular, Ukrzaliznytsia promised to make coupon payments on July 9 and 15 for Eurobonds totaling 900 million US dollars maturing in 2026 and 2028. This will occur despite the challenging market conditions and liquidity shortages.