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JSC TransContainer annual report 2008 1

01. Company profile — 6

Principal corporate developments in 2008 8Principal results for 2008 10 Business description 11Priority Activities 16

02. Management report on the Company’s activities in 2008 — 18

2.1. The container market 20

2.2. Operational results 26

2.3. Financial results 30

2.4. Strategy 38

2.5. Investments 40

2.6. Risks 42

2.7. Corporate governance 46

2.8. Social responsibility 58

03. Financial report — 64

Balance sheet 66Profit and loss report 69Auditor’s report 70Revision Commission’s report 72

04. Additional information — 74

Information on major and related party transactions 76Subsidiaries and affiliates 98Glossary 100Corporate details 104

Contents

DmitrY Novikov

Chairman of the Board of DirectorsJSC TransContainer

3

Dear Shareholders and Investors,

JSC TransContainer is an acknowledged leader in the Russian

market for railway container transportation, providing a full

range of container transportation and container processing

services, and accounting for 61% of all Russian container rail

turnover.

The Company owns and operates Russia’s largest fleet

of flatcars (more than 24,000 units) and containers (more than

60,000 units) and a nation-wide network of rail-side container

terminals. It is actively developing freight forwarding and

logistics services, which are of high added value.

A landmark event for JSC TransContainer in 2008 occurred

when the Company became JSC Russian Railways’ (“RZD”)

first subsidiary to place its shares in the equity capital mar-

kets. The European Bank for Reconstruction and Development

(EBRD) became the owner of 9.25% percent of JSC TransCon-

tainer’s shares, while another 5.75% of shares were sold

to private institutional investors.

As a result of changes to the capital structure, the composition

of the Board of Directors was changed significantly: the Board

was enriched with the expertise and knowledge of the new

shareholders’ representatives, as well as the independent

directors.

The core business model adopted by the Company — providing

clients with services which integrate the Company’s own

transportation, terminal and freight forwarding assets —

proved its sustainability in 2008. Despite the world economic

crisis (which Russia did not avoid), the Company managed not

only to preserve its position of market leadership, but also

to significantly exceed its business plan targets. The container

transportation volumes handled by the Company’s rolling stock

rose by 15.3% to 1.5 mln TEU, revenues increased by 51%

to 20.2 bln Rubles and net profit amounted to 2.7 bln Rubles,

(an increase of 75% compared to 2007). It is important to note

that this growth was due to an increase in the client base as

well as to higher quality and a broader range of services.

At the same time as actively developing its business, the

Com pany managed to maintain a low level of debt (less than

1xEBITDA), which contributed to its financial stability during

the hard economic conditions at the end of 2007 and at the

start of 2008, and developed as one of the Company’s competi-

tive advantages.

A lot of work was done last year to improve corporate gover-

nance in the Company. Strategy and audit committees were

established, credit and dividend policies were approved and

other internal rules were created to increase the Company’s

transparency.

In 2008, the Board of Directors approved the strategic direction

of JSC TransContainer’s development up to 2017. This became

the basis for establishing the Company’s activities and invest-

ment priorities for 2009.

This year, the Company aims to consolidate its leadership

position in the Russian market, as well as to create the basis

for further sustainable development.

On behalf of the Board of Directors, I want to give my thanks

to JSC Russian Railways, EBRD and our other shareholders

for their trust and support in supporting the development

of our business.

My thanks and gratitude also go to all employees of JSC

TransContainer for their contribution to the outstanding results

which the Company achieved last year. I wish them well

in reaching their professional goals in 2009.

Yours faithfully,

Dmitry Novikov

Chairman of the Board of Directors

JSC TransContainer

Petr Baskakov

General DirectorJSC TransContainer

5

Dear Shareholders, Investors, Colleagues and Partners,

2008 was very good for our Company. It succeeded in reaching

all the targets we set and we maintained its leadership in the

local rail container market, despite the world economic crisis.

In 2008, JSC TransContainer transported 1.5 mln TEU, or more

than 60% of all Russia’s railway container traffic. This was

15.3% percent more than we transported in 2007. The compa-

ny increased its fleet by 3,000 flatcars and 13,000 containers.

The capacity of the car fleet increased by 14.5% to reach

67,000 TEU, while our fleet of ISO containers increased by 50%

to exceed 75,000 TEU. Our own fleet of 40-foot containers grew

5 fold and the fleet of 80-foot platforms almost 9 fold. The

utilization rate of rolling stock increased and the number

of dispatches of container block-trains rose 2.5 fold.

We managed to increase the volume of our operations and

maintain our competitive edge thanks to persistent effort

to provide high-quality service and to promote our services,

even in conditions of decreasing demand for rail container

transportation services due to a fall in industrial production.

For xample, the Company has now fully adopted requisition

and income accounting within a unified information system,

allowing clients to register the whole range of services it

requires across all JSC TransContainer sub-divisions.

In the tough economic circumstances of 2008 the Company

placed its debut bond issue of 3 bln Rubles. The money was

used to fund the Company’s investment programme.

In 2008, the Company expanded its presence in Russia and

also across important international transportation routes.

JSC TransContainer opened Russia’s largest inland container

terminal at Zabaikalsk, following its reconstruction, and

launched a multi-modal freight container route to deliver

timber from Lesosibirsk (Krasnoyarsk region) to the port

of Alexandria (Egypt). The Company took on a long-term lease

with the Dobra (Slovakia) trans-shipping terminal which,

thanks to its geographic location and infrastructure, will

allow JSC TransContainer to handle over 250,000 TEU

annually and will act as a gate for the transportation of Euro-

pean goods to Russia in the same way that it serves as a gate

for container flows from East Asia.

In addition during 2008 the Company continued to pursue its

active social policy by not only creating decent working and

living conditions for its employees, but also by doing its share

to improve social conditions in the regions where it operates.

I would like to offer my sincere gratitude to all JSC TransCon-

tainer employees for their strong expertise and their innova-

tive approach to their work, which will enable the Company

to fulfill its long-term development plans and maintain its

market leadership.

Yours faithfully,

Petr Baskakov

General Director

JSC TransContainer

6 04 Additional Information

COMPANY PROFILEPrincipal events and results for 2008. Business description and principal business activities

6

7JSC TransContainer annual report 2008

COMPANY PROFILEPrincipal events and results for 2008. Business description and principal business activities

7

8

01January

A demonstration run of the first interna-

tional freight container train on the

Beijing-Hamburg route was organised.

The Company acted as a forwarder

on the territory of Mongolia, Russia and

Belarus using its own rolling stock.

Freight container trains started carrying

Volkswagen component parts from the

Czech Republic and Slovakia to the

Volkswagen RUS factory in Kaluga.

JSC TransContainer organized a regular

service from the Japanese ports

of Nagoya, Kobe and Yokohama.

February

The shareholder structure of the Compa-

ny changed upon the private placement

of 15% of JSC TransContainer shares.

LLC Port Vyborgsky (Oslo Marine

Group) and JSC TransContainer signed

a cooperation agreement to open

a TransContainer agency to resolve the

port’s transportation and logistics

problems.

March

The Company established the regular

delivery of Hyundai Elantra automobile

component parts from Korea to the

Russian factory of TagAZ (Taganrog).

JSC TransContainer placed its debut

series 01 bonds with a nominal value

of 3 bln Rubles on the MICEX Stock

Exchange.

April

A new Board of Directors of JSC Trans-

Container was elected.

Companyprofile

principal corporate developments in 2008


May

JSC TransContainer and CRIMT, an affili-

ate company of China Railways, signed

a memorandum to cooperate in the

transportation of freight in containers

on international railway services across

Russia and China.

JSC TransContainer and LLC TransGroup

AS signed a letter of intent to set up

a joint venture to fulfil a project to build

and launch a freight terminal in the port

of Zarubino (Primorsky Region) to ser-

vice transit freight flows from the

Asia-Pacific Region to Europe.

The Board of Directors of JSC TransCon-

tainer elected Dmitry Novikov as its

Chairman.

The audit committee and the strategy

committee were set up under the Board

of Directors of the Company.

June

JSC TransContainer and Volkswagen

RUS signed an additional agreement

to establish logistics at the Volkswagen

factory in Kaluga. Under the agreement,

JSC TransContainer will perform the

loading/discharging of freight containers

at the factory.

LLC Trans-Eurasia Logistics GmbH,

a joint venture between JSC RZD, JSC

TransContainer and Deutsche Bahn, was

registered in Germany to provide

international freight container transpor-

tation.

July

The Board of Directors of the Company

approved Provisions on insider informa-

tion and Provisions on information

disclosure.

September

JSC TransContainer paid a coupon on its

series 01 bonds.

JSC TransContainer, LLC TransGroup AS

and two Japanese logistics companies,

Kamigumi Co. and Kintetsu World

Express, signed a memorandum called

“To Set Up Cooperation When Running

a Terminal” in the Port of Zarubino.

JSC TransContainer and Kintetsu World

Express, a Japanese company, and

UNICO Logistics Co, a Korean company,

signed a letter of intent to set up a joint

venture to offer integrated logistics

services in the 3PL format.

Standard & Poor’s international rating

agency assigned the Company a GAMMA

5+ corporate governance rating.


decided that JSC TransContainer would

participate at the Co-ordination Trans-

port Meeting of CIS (Commonwealth

of Independent States) countries.


decided to set up LLP TransEurasia,

a joint Russo-Kazakh venture to manage

freight container transport between

Russia and Kazakhstan.

October

A refurbished JSC TransContainer

terminal was opened at Zabaikalsk,

on the Russian-Chinese border, becom-

ing Russia’s largest land freight contain-

er terminal.

A regular multi-modal freight container

route was launched to deliver timber

from Lesosibirsk (Krasnoyarsk Region)

to the port of Alexandria (Egypt) via the

port of Zapadny in Rostov-on-Don.

The RID-Expert RA consortium assigned

the Company a national corporate gover-

nance rating of 6, which demonstrates the

extent of the corporate governance sys-

tems developed at JSC TransContainer.


approved the Provisions on its dividend

policy.


approved the Principal lines and targets

of JSC TransContainer development.

10 01 Company profile

November

JSC TransContainer took a long-term

lease on the Dobra transshipping

terminal, located near Cierna nad Tisou

(Slovakia), close to the border with

Ukraine.


approved the credit policy of JSC

TransContainer.

December

JSC TransContainer became a laureate

of the Company of the Year, the 10th

anniversary prize, in the Logistics and

Freight Transportation.

principal results for 2008

Name of index 2007 2008 Change absolute

%

Key operational results

Container transportation volume (thousands TEU), including:

1,303 1,502 199 +15.3%

• domestic traffic 827 873 46 +5.6%

• international traffic 476 629 153 +32.2%

Terminal handling (thousands TEU) 1,972 1 899 –73 –3.7%

Key financial metrics

Revenue (mln Rubles) 13 431 20 226 6 795 +51%

EBITDA 4 440 7 095 2 655 +60%

Gross income 2 641 4 441 1 800 +68%

Net income 1 532 2 680 1 148 +75%

EBITDA margin 33% 35% +2%

Gross margin 20% 22% +2%

Net income margin 11% 13% +2%

Net assets 16 766 19 063 2 297 +14%

Total assets 20 293 26 916 6 623 +33%

Ratings

GAMMA corporate governance rating (Standard & Poor’s)

— 5+ — —

National corporate governance rating — 6 — —

JSC TransContainer annual report 2008 11

“Centre for cargo container traffic

TransContainer” was set up as an open

stock company on March 4, 2006, on the

basis of assets of a branch of JSC

Russian Railways. It has been operating

since July 1, 2006. JSC TransContainer

was founded and is developing as

a vertically integrated business aimed at

providing integrated transport and

forwarding services for clients on a door-

to-door principle.

JSC TransContainer is Russia’s largest

rail freight container operator, managing

a fleet of 60,000 ISO containers and over

24,000 specialized flatcars. After JSC

Russian Railways, the Company is

Russia’s second largest operator

of rail-side container terminals, which

are located at 47 railway stations.

The JSC TransContainer sales network

has 140 offices located all over Russia

and is the largest in the sector. The

Company also offers freight-forwarding

and logistics services in neighbouring

states via a network of representative

offices and agent companies. The

Company’s client base includes more

than 20,000 regular customers and is

widely diversified by industry and region.

JSC TransContainer develops its busi-

ness geographically by setting up joint

ventures, by broadening its network

of agent companies and representative

offices abroad and by offering a broader

range of services.

Business description


GEOGRAPHY OF BUSINESS OFOPEN SOCIETY "TRANSCONTAINER"

Карта России

MOSCOW

Novosibirsk

Irkutsk

Krasnoyarsk

Chita

Khabarovsk

Yuzhno-Sakhalinsk

Chelyabinsk

Voronezh

Rostov-on-Don

Saratov

Yaroslavl

Saint PetersburgKaliningrad

Nizhny Novgorod

Samara

Yekaterinburg

• Chelyabinsk

• Chita

• Irkutsk

• Kaliningrad

• Khabarovsk

• Krasnoyarsk

• Moscow

• Nizhny Novgorod

• Novosibirsk

• Rostov-on-Don

• Saint Petersburg

• Samara

• Saratov

• Voronezh

• Yaroslavl

• Yekaterinburg

• Yuzhno-Sakhalinsk

12

Geography of JsC transContainer businessRUSSIAN NETWORK


GEOGRAPHY OF BUSINESS OFOPEN SOCIETY "TRANSCONTAINER"

Карта России

MOSCOW

Novosibirsk

Irkutsk

Krasnoyarsk

Chita

Khabarovsk

Yuzhno-Sakhalinsk

Chelyabinsk

Voronezh

Rostov-on-Don

Saratov

Yaroslavl

Saint PetersburgKaliningrad

Nizhny Novgorod

Samara

Yekaterinburg

• Chelyabinsk

• Chita

• Irkutsk

• Kaliningrad

• Khabarovsk

• Krasnoyarsk

• Moscow

• Nizhny Novgorod

• Novosibirsk

• Rostov-on-Don

• Saint Petersburg

• Samara

• Saratov

• Voronezh

• Yaroslavl

• Yekaterinburg

• Yuzhno-Sakhalinsk

13

Branch offices of JSC TransContainer

JSC TransContainer annual report 2008


Le Havre

Thamesport

Southampton

TilburyLondon

AmsterdamRotterdam

Zeebrugge

Warsaw

BrestKiev

Trieste

Minsk

UKRAINECZECH REPUBLIC

KAZAKHSTAN

LATVIA

FINLAND

CHINA

MONGOILA

JAPAN

SOUTHKOREA

GERMANY

Bremerhaven

Berlin

Hamburg

Moscow

Tuchkovo

Tallinn

Yelabuga

Assake

Zamin Ude

ZabaikalskNaushki

Ulan-Ude

Novosibirsk

Yekaterinburg

Pusan

Chiwan

Hong KongShenzhen

Yan Tian

Ningbo TokyoShimizu

NagoyaKobe

Shanghai

Beijing

Vladivostok

Kaohsiung

Tanjung Pelepas

Singapore

Nakhodka

SaintPetersburg

Helsinki

Kotka

KrasnoeBELARUS

Koper

Kosice

MladaBoleslav

Dobra Martsevo

UZBEKISTAN

TURKEYIstanbul

Gemlik

Genoa

Salerno

Novorossiysk

LITHUANIA

International Transport Corridor №2 (ITC №2)

International Transport Corridor №5 (ITC №5)

Trans-Siberian mainline

Other land routes

Sea routes

14

Geography of JsC transContainer businessINTERNATIONAL NETWORK

Joint ventures:• Finland

• Germany

Representative offices and agents::• Czech Republic

• Germany

• Ukraine

• Belarus

• Latvia

• Lithuania

• China

• Uzbekistan

• Turkey

• Kazakhstan

• Mongolia

• South Korea

• Japan


Le Havre

Thamesport

Southampton

TilburyLondon

AmsterdamRotterdam

Zeebrugge

Warsaw

BrestKiev

Trieste

Minsk

UKRAINECZECH REPUBLIC

KAZAKHSTAN

LATVIA

FINLAND

CHINA

MONGOILA

JAPAN

SOUTHKOREA

GERMANY

Bremerhaven

Berlin

Hamburg

Moscow

Tuchkovo

Tallinn

Yelabuga

Assake

Zamin Ude

ZabaikalskNaushki

Ulan-Ude

Novosibirsk

Yekaterinburg

Pusan

Chiwan

Hong KongShenzhen

Yan Tian

Ningbo TokyoShimizu

NagoyaKobe

Shanghai

Beijing

Vladivostok

Kaohsiung

Tanjung Pelepas

Singapore

Nakhodka

SaintPetersburg

Helsinki

Kotka

KrasnoeBELARUS

Koper

Kosice

MladaBoleslav

Dobra Martsevo

UZBEKISTAN

TURKEYIstanbul

Gemlik

Genoa

Salerno

Novorossiysk

LITHUANIA


16 01 Company profile

priority activities

Business line Principal services Assets as at 31/12/08 Share of revenue

Rail-based container transportation ser-vices

• Providing clients with rolling stock to haul clients’ freight in containers

• providing clients with rolling stock to haul clients’ containers• providing flatcars and containers on a lease basis• providing medium-duty containers on a lease basis

• 24,200 flatcars • 60,100 ISO containers• 76,100 medium-duty con-

tainers (MDC)

46.7%

Terminal and agency services

• Container loading, unloading and storage (within the frame-work of an agency agreement with JSC Russian Railways)

• additional terminal services (loading/unloading goods in/ from containers, preparation of containers for charging, etc.)

• bonded warehousing services

• Container terminals at 47 railway stations

• 5 bonded warehouses• over 290 units of loading

equipment

15.7%

Freight-forwarding and logistics services

• Freight forwarding, including the preparation of transporta-tion documents, customs clearance, etc.

• container freight monitoring, delivery schedules planning and optimization

• organization of multi-model container door-to-door deliveries

• 140 sales offices in Russia• 16 agents and 7 repre-

sentative offices abroad• 2 joint ventures

28.9%

Truck deliveries • Transportation of containers between railway terminals and clients’ warehouses

• transportation under customs control and container delivery from a customs stations to clients’ warehouses

• Over 330 truck-tractors• over 500 semi-trailers• over 100 lorries

8.2%



MANAGEMENT REPORT ON THE COMPANY’S ACTIVITIES IN 2008

18


MANAGEMENT REPORT ON THE COMPANY’S ACTIVITIES IN 2008

19

20

The international container market

According to Drewry Shipping Consul-

tants Ltd, the volume of international

container transportation in 2008

amounted to 152.8 mln TEU. That

represented growth over the previous

year of 7.2%, which is significantly lower

than the average annual growth of 11–

12% during the previous 7 years. This

was due to a sharp fall in volumes

during the fourth quarter of 2008

because of the world economic crisis.

According to RBС, the average contain-

erization level globally was on average

50–60% of the total volume of dry freight

carriage. In financial terms, the size

of the container freight market is nearly

$1 trln. The largest flow of container

traffic goes from Asia-Pacific Region

states to Western Europe and the United

States, with China accounting for about

25% of international container freight

turnover.

From the second half of 2008 there was

a fall in sea freight rates as the interna-

tional container freight market shrank

following the crisis in the world economy.

manaGement report on the Company’s aCtivities in 200802the Container market 02 1


Rail-based container transportation

According to RBC, Russia’s 2008 total

container market in 2008 amounted

to about 5.5 mln TEU.

The rail container turnover amount-

ed to 2.45 mln TEU in 2008, an increase

of 15.6% compared to 2007 levels. This

was the highest in the average growth

rate in the sector since 2001, mainly due

to container turnover growth in import

and export traffic (by 30% and 28% re-

spectively). As a result, the share of inter-

national traffic by rail of the overall volume

of container turnover rose to 54% in 2008

compared to 50% in 2007 while domestic

container traffic increased by just 6.3%.

The dynamics of Russian railway container turnover (2001–2008)

2001 2002 2003 2004 2005 2006 2007 2008

3.0

2.5

2.0

1.5

1.0

0.5

0.0

0.981.17

1.371.49

15.6%

1.731.85

2.12

2.45

Source: Booz&Co

The economic crisis had a negative

impact on the Company, pushing the

traffic volume down by 8% in the

4th quarter of 2008 compared with the

3rd quarter of 2008. Nevertheless, the

volume of rail container transportation

increased by 3% more in the 4th quarter

of 2008 compared to the 4th quarter

of 2007.

A fall in industrial production following

the shortage of loan supply from banks

and decreasing international demand for

Russia’s main export goods, as well as

lower demand in Russia and Ruble

exchange rate dynamics, which were

unfavourable to imports, can be singled

out as key reasons for falling traffic.

Average annual growth rate 14%

02 Management Report on the Company’s Activities in 2008 22

However, despite deteriorating econom-

ic conditions at the end of 2008, the

fundamental factors for growth in Rus-

sia’s container freight market remain

in place. The medium term growth of the

container freight market will be driven

by the dynamics of consumer and

investment markets in Russia and the

CIS, the development of transport and

logistics infrastructure and the level

of containerization.

According to Company data, container-

ization levels for rail-based container

transportation in Russia amounted

to just 3.6% in 2008, an increase

of 0.3 percentage points from 2007

levels. The containerization level for

international freight traffic amounted

to 9.3% in 2008. The containerization

level in export traffic grew to 5.6%

in 2008, compared to last year’s level

of 4.6%.

Chemical industry, cars and car compo-

nents, pulp and paper goods, food and

metal ties contributed mainly to the

Russian container turnover.

15%14%

11%

9%8%7%7%

29%

The structure of Russian rail container freight turnover

Chemicals 15%

Cars & car

components 14%

Pulp & Paper 11%

Food 9%

Metal ties 8%

Machines,

Machine tools 7%

Non-ferrous Metals 7%

Other 29%

Source: JSC TransContainer

Russian railway container turnover structure in 2008 (thousands TEU)

23.5%

24.3%

6.3%

45.9%

Import 576 thou. TEU, 23,5%

Export 596 thou. TEU, 24,3%

Transit 154 thou. TEU, 6,3%

Local 1 127 thou. TEU, 45,9%



JSC TransContainer’s industry leadership

The Company holds the leading position in the market and its key business segments, the servicing of freight container rail transportation and the operation of container terminals.


The Company owns Russia’s largest

flatcar fleet comprising of more than

24,000 units, or 61% of Russia’s total

flatcar fleet. The Company successfully

services and upgrades its rolling stock

and has unique know-how about fleet

management in the Russian Federation

across more than 280,000 routes.

In 2008 the Company serviced 61% of all

Russian rail-based container turnover.

The structure of the Russian container flatcar fleet (in units)

as of Dec. 31, 2008

The structure of the market for rail container transportation

by own rolling stock in 2008 (TEU)

39%

39%

61%

61%

TransContainer 61%

Other owners 39%


TransContainer

1 502 thou. TEU, 61%

Other owners 951 thou. TEU,

39%



Rail-based container terminals

The Company owns terminals at

47 stations on JSC Russian Railways’

network, which are located on the

busiest routes, including key transport

hubs and points of container inflows.

The Company terminals’ share of the

overall handling of containers across the

JSC Russian Railways network, includ-

ing the handling of rail terminals at sea

ports and the loading/unloading on con-

signors’ approach lines, amounted

to 36% in 2008.

Company’s share in the Russian rail-side terminal

handling of containers in 2008 (in TEU)

TransContainer 36%

Other 64%

Source: Booz&Co

64%

36%

25JSC TransContainer annual report 2008 25JSC TransContainer annual report 2008


Rail-based container freight

In 2008, the volume of containers

transported by the Company’s fleet

increased by more than 15% to over

1.5 mln TEU. Its share of overall rail-

based container transportation in Russia

remained unchanged from the previous

year, at more than 61%. By contrast, the

Company’s international freight opera-

tions grew by 32% to 629,000 TEU,

increasing the proportion of internation-

al traffic in the Company’s total trans-

portation volumes by 5.5% to 42%

in 2008. The Company’s market share

in the international routes rose to 47.5%

(+2.6% on 2007 levels).

operational results02 2Volumes of container rail freight

transported by the Company’s own

rolling stock (thousands TEU)

Export Import

Transit Domestic


2007 2008

827101

185

190

1 303

873127

218

284

1 502

1 500

1 000

500

0

+15.3%


The structure of container rail freight transported

by the Company’s own rolling stock in 2008 (thousands TEU)

Given high demand for container

transportation in the first three quarters

of 2008, the container transportation

volume growth was mainly driven by the

amount of the available rolling stock and

the average turnover of the fleet.

In 2008, the Company took a number

of steps to improve its fleet.

Thus, the Company’s flatcar fleet

increased by 3,000 units to 24,200 units

(including 1,500 leased platforms).

Among this, the share of high-capacity

80-foot flatcars increased by 7.6 times

in 2008. The Company’s fleet capacity

in terms of TEU grew by 14.5% in 2008.

The growth in the fleet utilization in 2008

was achieved through improved fleet

management and increased number

of block-trains. In 2008, the number

of block-trains arranged JSC TransCon-

tainer increased 2.5 fold, compared with

2007 levels, to reach 1,000 runs.

Freight carried in the Company’s own

containers accounted for about 57%

of overall containers transported by the

Company’s fleet, or more than 850,000

TEU (growth of 24.5% compared to 2007).

19%

15%

8%

58%

Export 18%

Import 15%

Transit 8%

Domestic 58%


80-foot flatcars

60-foot flatcars

40-foot flatcars


31.12.07 31.12.08

26,2%

73,0%

0,8%21,200

30,0%

64,1%

0,9%24,200

+3,000

The dynamics and structure of the Company’s

container flatcars (thousands units)

25 000

20 000

15 000

10 000

5 000

0


In 2008, the Company’s container fleet

increased by 13,100 units to 60,100 units.

The proportion of high-capacity 40-foot

containers within its fleet increased more

than four fold to 25% of the total fleet. As

a result the capacity of the container fleet

increased by 50% in TEU terms.

Terminal and agent services

In 2008, the Company handled 1.9 mln

TEU at its 47 terminals, or 36.8%

of Russia’s total rail container terminal

handling in 2008 and retained its leading

position in rail-side container terminal

handling in Russia.

The Company’s terminals have “site

of common use” status and handle the

containers of all market operators.

The volume containers handled at the

Company’s terminals in 2008 fell 3.7%

compared to the previous year, mainly

due to a fall in the volume of MDC

handling, as well the negative market

trend in the fourth quarter. However, the

volume of ISO container handling at the

Company’s terminals rose by 1% in 2008.

Truck deliveries

In 2008, the Company continued to de-

velop its business of hauling containers

from the Company’s terminals to cus-

tomer warehouses by trucks for loading/

unloading, thus providing door-to-door

container deliveries. The volume

of container transportation by trucks

rose by 26% in 2008 to exceed 700,000

TEU. The share of ISO containers

in trucking container activities amount-

ed to 84%.

The growth in truck deliveries in 2008

was mainly due to a growth in deliveries

by the Company’s own truck fleet. The

share of deliveries by the Company’s

own truck fleet rose to 39%, compared

to 28% a year earlier, while the share

of transportation by outsourced trucks

The dynamics of trucking container

activities* (thousands TEU)

Own truck Other owners’ * ISO+MDC

fleet truck fleet

The dynamics and structure

of the Company’s ISO container fleet

(in units)

The dynamics of container handling*

at the Company’s container terminals

(mln TEU)

40-foot containers 20-foot containers


* ISO+MDC, loaded and empty


31.12.07 31.12.08

94%

6%

47,000

75%

25%

60,100+13,100

2007 2008

1.971.90

–3.7%

2.0

1.5

1.0

0.5

0.0

2007 2008

401

432

800

600

400

200

0

271

158

704

559

+25.9%

60 000

40 000

20 000

0


Lorries Tractors Semi-trailers


31.12.07 31.12.08

48%

53%

35%

12%

16%

36%

680 units

960 units+280 units

decreased from 72% to 61%, respective-

ly. The truck container transportation

increased due to the growth and

improvement of its truck fleet, and the

growth in truck turnover.

The Company’s own truck fleet grew by

280 units (or 41%) in 2008, to 960 units

by the end of the year. The growth in the

number of semi-trailer trucks was two

times higher than the growth in the

number of tractors, allowing for better

management of the truck fleet.

Freight-forwarding and logistics services

In 2008, the Company actively developed

the business of offering value added

freight-forwarding services including

intermodal container door-to-door

deliveries at a through-rate, i.e. offering

an integrated package of intermodal

container transportation at a unified

fixed tariff.

During the year the Company improved

the range and quality of its freight-for-

warding and logistics services, introduc-

ing new information technology and

increasing the number of dedicated

client service centers. The Company

successfully introduced container

shipment technology for goods such as

liquids, sawn timber, bulky goods and

cars and now offers services using

specialized containers, such as insulated

containers, grain-bulkers, tank-contain-

ers, and open-top containers.

As a result, in 2008 the Company more

than doubled revenues generated by

freight-forwarding and logistics services

to 1.7 bln Rubles.

The dynamics and structure

of the Company’s truck fleet

1 000

800

600

400

200

0


JSC TransContainer presents financial

results for 2008 in accordance with

Russian Federation Accounting Stan-

dards. BDO Unicon checked the Compa-

ny’s report in accordance with Russian

auditing standards and provided a posi-

tive auditor’s report.

In 2008, the Company broadened the

range of its services significantly,

including the integrated services

of intermodal container deliveries at

through tariff rates.

finanCial results 02 3

Principal financial results

Index, mln Rubles 2007 2008

Revenue, including 13 431 20 226

• Third-party services for through-rate transportation *** 2 754

Adjusted revenue * 13 431 17 472

Rail-based container transportation services 8 531 9 455

Terminal services and agency fees 2 748 3 171

Freight-forwarding and logistics services (including services at a through-rate)

895 5 848

Truck deliveries 1 180 1 652

Other 77 100

Expenses, including: 10 790 15 786

• Third-party services 4 935 8 156

— empty runs 2 071 2 340

— repair and maintenance 1 754 1 546

— third-party services for through rate transportation — 2 754

— other services 1 110 1 516


In 2008, Company revenue increased by

50.6% to 20.2 bln Rubles, including 2.8

bln Rubles representing third-party

services for through-rate transportation

contracts. The company’s own revenues

amounted to 17.5 bln Rubles or 30%

more than in the same year-ago period.

2008 gross income increased by 68.2%

compared with 2007 and amounted

to 4.4 bln Rubles. Net income amounted

to 2.68 bln Rubles, or 74.9% above 2007

levels.

* revenue less expenditure for third-party services for through-rate transportation

** to adjusted revenue

*** in 2007, the volume of associated third-party services for through-rate transportation was

insignificant and did not stand out in accounting

Index, mln Rubles 2007 2008

• Payroll and related expenses 1 880 2 506

• Other operating expenses 1 361 2 267

• Amortisation and depreciation 1 792 2 143

• Materials, fuel and electricity 700 501

• Commercial expenses 122 213

Gross income 2 641 4 441

Gross margin 20% 22%

Adjusted gross margin ** — 25%

Other revenues, net 55 362

Income before tax 2 586 4 079

Income tax 1 054 1 399

Net income 1 532 2 680

Net income margin 11% 13%

Adjusted net income margin** — 15%

EBITDA 4 440 7 095

EBITDA margin 33% 35%

Adjusted EBITDA margin** — 41%


Revenue

Company revenue in 2008 was gener-

ated from the following principal

sources:

1) Revenue from rail-based container

transportation services amounted

to 9.5 bln Rubles, increasing by 11%

compared with 2007 due to rising

demand for container freight. These

activities accounted for 47% of the

Company’s total revenue.

2) Revenue from terminal services and

agency fees increased by 15% compared

with 2007 levels to 3.2 bln Rubles. The

growth took place despite falling

volumes of container transshipments by

3.7%, mainly due to a growth in regulat-

ed tariffs on operations executed by JSC

TransContainer as JSC Russian Rail-

ways’ agent, as well as due to new

services offered by the Company at its

terminals, such as bonded warehousing

services. Revenues from terminal

services and agency fees contributed

16% to the Company’s total revenue.

3) Revenue from freight -forwarding

and logistics services amounted

to 5.8 bln Rubles and grew by 6.5 times

compared with 2007, following an up-

turn in the Company’s activities in this

market segment and a rapid increase

in the volume of operations at

a through-rate reflected in this revenue

item. More than 160,000 TEU was

hauled in 2008 under through-rate

contracts. The share of freight-forward-

ing and logistics services in the Compa-

ny’s total revenue increased to 29%

from 7% a year earlier.

4) Revenue from truck deliveries

amounted to 1.7 bln Rubles, which is

40% more than in 2007. The growth was

due to rising demand for the ‘last mile’

JSC TransContainer revenue structure in 2007

JSC TransContainer revenue structure in 2008

0.6%

0.5%

20.5%

15.7%

63.5%

46.7%

8.8%

8.2%

6.7%

28.9%

Container transportation

services 63.5%


20.5%

Transportation and

forwarding services 6.7%

Truck transportation services

8,8%

Other 0.6%

Container transportation

services 46.7%


15.7%

Transportation and forward-

ing services 28.9%

Truck transportation services

8.2%

Other 0.5%


service, as well as to favourable price

trends in the first nine months of 2008.

The share of truck deliveries in the

Company’s total 2008 revenue amounted

to 8%, compared with 9% a year earlier.

Expenses

The Company’s principal costs in 2008

were Expenses on third-party services

for through-rate transportation

(expenses share 17.4%), payrolls and

related charges (15.9%), empty runs

(14.8%), depreciation and amortization

(13.6%) as well as repair and mainte-

nance (9.8%).

Expenditure on empty runs rose by 13%

compared with 2007 to 2.3 bln Rubles.

This rise in costs followed growth in JSC

Russian Railways’ tariffs and a higher

volume of container transportation.

It was partially compensated for by

a decrease in empty runs of cars and

containers, due to improved manage-

ment of the rolling stock fleet.

Expenditure on third-party services for

through-rate transportation amounted

to 2.8 bln Rubles and is singled out as

an independent item, starting in 2008,

when a rapid growth in the volume

of such operations was registered

following growing demand from clients for

this type of service.

Payrolls and related charges amounted

to 2.5 bln Rubles, which is 33.3% more

than in 2007. The growth is due to the

increase of base wages under a Collec-

tive bargaining agreement, as well as

to the growth in the number of person-

nel as the volume of container haulage

and handling increased in 2008.

Expenditure on repairs and mainte-

nance amounted to 1.5 bln Rubles,

which is 11.9% less than in 2007.

The structure of expenses in 2007

1%

17%46%

6%

13%

17%

Third-party services 46%

Payrolls and related charges

17%

Other operational expenses

13%

Amortization and depreciation

17%

Raw materials, fuel and

electricity 6%

Commercial expenses 1%

The structure of expenses in 2008

1%

16% 52%

3%14%

14%

Third-party services 52%

Payrolls and related charges

16%

Other operational expenses

14%

Amortization and depreciation

14%

Raw materials, fuel and

electricity 3%

Commercial expenses 1%


The decrease was due to better man-

agement of repair works.

Other operating expense included rent,

leasing, property security, the cost of au-

dit, legal and other consulting services,

as well as other operating expenses. The

2008 total of these items amounted

to 2.3 bln Rubles.

Company’s assets

As of December 31, 2008 the Compa-

ny’s assets were RUR 26.9 billion and

had increased by 32.6% compared

to the previous year. The increase was

primarily due to increase in fixed assets

and short-term receivables.

Fixed assets amounted to 17.2 bn Rubles

as of December 31, 2008, or 63.8%

of total assets. In 2008 fixed assets

increased by 3.9 bn Rubles, or by 28.9%

primarily due to the Company’s large-

scale investment programme.

Short-term (up to one year) receivables

amounted to 5.5 bln Rubles or 20.6%

of the total assets as of December 31,

2008. an increase of 81.9% compared

with 2007 was primarily due to advance

payments related to purchase of fixed

assets. Commercial receivables amount-

ed to 1.2 bln Rubles as of December 31,

2008, or 4.5% of total balance (27.6%

growth).

Construction in progress amounts

to 2,124,656,000 Rubles, or 7.9% of total

assets. The figure grew by 79.8% due

to upgrading works at the Zabaikalsk

terminal.

Inventories amounted to 568,630,000

Rubles, or 2.10% of total balance as

of December 31, 2008. This was a de-

crease of 6.4% compared to 2007.

Cash amounted to 443 321,000 Rubles

(1.6% of total balance) as of December 31,

2008, an increase of 2.2 times on the 2007.

Aggregate balance sheet of the Company

mln Rubles 2007 2008

Balance

Fixed assets, including: 14,805 19,616

• capital assets 13,324 17,175

Current assets, including: 5,488 7,300

• short-term receivables 3,046 5,540

• short-term financial investments 1,255 14

• cash 202 443

Total assets 20,293 26,916

Equity capital 16,766 19,063

Long-term liabilities, including: 62 3,302

• loans and credits 3,094

Short-term liabilities, including: 3,465 4 552

• payables 3,464 4,551

Equity capital and liabilities 20,293 26,916

Debt / funds available 0.0 6.8

Debt / EBITDA 0.0 0.4


approved by Order #10n of the Ministry

of Finance of the Russian Federation

and FCSM of Russia #03-6/pz dated

January 29, 2003.

Equity and liabilities

The Equity capital of the Company

amounted to 19.1 bln Rubles as of De-

cember 31, 2008 and increased by 13.7%

compared to 2007, due mainly to income

capitalization Equity-to-assets ratio

amounted to 70.8% as of December 31,

2008.

Borrowings. In 2008, the Company

issued bonds worth 3 bln Rubles at its

nominal value, with maturity in March

2013 and a semi-annual coupon pay-

ment. an annual coupon rate of 9.5%

was set for the first two coupons. The

rate of future coupons will be set by the

Company. As of December 31, 2008, the

Company’s debt on borrowings amount-

ed to 3,093,690,000 Rubles, including

3,000,000,000 Rubles of the bond issue

nominal value and 93,690,000 Rubles

in accrued coupon.

Payables amounted to 4.6 bln Rubles as

of December 31, 2008. The growth

in payables amounted to 31.4% com-

pared to December 31, 2007. The share

of payables of the Company’s assets

amount to 16.9%.

Net assets of the Company increased by

2,296,743,000 Rubles or 13.7% during

the reporting period. As of December

31, 2008 net assets amounted

to 19,062,658,000 Rubles. So net assets

are 5,167,880,000 Rubles more than the

Company’s share capital (13,894,778,000

Rubles)

Net assets were calculated under the

practice of the net assets value assess-

ment for a joint stock company,

Asset structure in 2008

13.9%

20.6%

63.8%

0.1%1.6%

Asset structure in 2007

12.1%

15.0%

65.7%

6.2%1.0% Fixed assets 65.7%

Short-term receivables 15.0%

Short-term financial

investments 6.2%

Cash 1.0%

Other assets 12.1%

Fixed assets 63.8%

Short-term receivables 20.6%

Short-term financial

investments 0.1%

Cash 1.6%

Other assets 13.9%


Cash flow

The Company’s principal source of cash

was net cash flows from operating

activities, which amounted to 6.1 bln

Rubles in 2008, a 47.5% increase

on 2007 levels.

Net cash flow from investment activities

was negative and amounted to 4.6 bln

Rubles in 2008. The cash allocated for

the acquisition of capital assets amount-

ed to 8.9 bln Rubles, including VAT

(growth of 68.6%, or 3.6 bln Rubles

on 2007).

The amount of net cash allocated for

financial activities amounted to 1.2 bln

Rubles in 2008, mainly due to growth

in expenditure on the “finance lease

payment” item due to an early repay-

ment in 2008 of a part of the Company’s

liabilities on finance leasing. In 2007, the

Company had growth in net cash from

financial activities, due to an inflow

of cash in payment of authorized capital

stock of the Company from the major

shareholder.

JSC TransContainer's equity and liabilities structure in 2007

JSC TransContainer's equity and liabilities structure in 2008

17.1%

16,9%11.5%

82.6%

70.8%

0.3%

0.8%

Equity capital 82.6%

Payables 17.1%

Other liabilities 0.3%

Equity capital 70.8%

Loans and credits 11.5%

Payables 16.9%

Other liabilities 0.8%


Financial stability

An analysis of the Company’s 2008

financial position demonstrates positive

changes to principal performance

indicators.

Profitability ratios demonstrate a signifi-

cant improvement in business efficiency

in 2008 compared with 2007.

Operating performance also demon-

strates a significant improvement

in 2008 compared with 2007.

Liquidity ratios demonstrate an im-

proved quality of working capital man-

agement compared to 2007.

Cash flow statement, mln Rubles

mln Rubles 2007 2008

Net cash flow from operating activities 4,107 6,057

Net cash flow from investment activities ( 5,304) (4,581)

Net cash flow from financial activities 820 (1,236)

Net growth of cash and equivalents (377) 241

Cash and equivalents as at the beginning of the year 579 202

Cash and equivalents as at the end of the year 202 443

For reference:

Capital expenditure (5,282) (8,905)

Financial ratios*

Index 2007 2008

Return on equity 9.5% 14.9%

Total assets margin 14.1.% 20.8%

Gross margin 19.7% 22.0%

Net income margin 11.4% 13.3%

EBITDA margin 33.1% 35.1%

Turnover period of commercial receivables, in days 25 19

Turnover period of payables, in days 107 104

* The statistical indices were transferred into dynamic indices by calculating an arithmetic mean for

the period for a consistent assessment of the indices. The EBITDA index, calculated according

to the accounting report, was adjusted to account costs on financial lease.



on December 29, 2008 preliminarily

approved the Company’s strategic

elements of activity until 2017.

Principal strategic targets of the Company

• the growth in scale and volume

of operations through the growth of its

own container and flatcar fleet, the

development of terminal infrastructure

and the expansion of its sales network;

• the geographical and industrial

expansion of business through acquisi-

tions and strategic alliances, the

development of new routes, the master-

ing of new activities and the acquisition

of assets;

• to increase operational efficiency by

the implementation of new haulage

technologies, improve fleet operations,

develop value added services and install

new IT systems and management

methods.

Priority projects


The Company plans:

• to upgrade its rail flatcar and

container fleet, improving its structure

and increasing the size of the fleet

in accordance with demand trends;

• to increase the number of block-

trains, including the implementation

of block train runs between the Compa-

ny’s own hub-terminals in order

to concentrate container flows; and

• to reduce expenses on idle hours

and empty runs through the introduc-

tion of IT- systems, and the improved

management of fleets and terminals.

Terminal activities

The Company plans to invest in the de-

velopment and broadening of its ter-

minal network. The Company plans

strateGy 02 4JSC TransContainer’s mission is to contribute effectively to cli-ents’ businesses by means of providing quick, safe and integrated solutions for container transportation in Russia, the CIS and globally.


to focus on upgrading a number of the

busiest terminals in order to increase

their capacity, as well as to create stor-

age capabilities and bonded warehouses

at a number of the Company’s terminals.

The Company also plans to broaden the

network of terminals through:

• cooperation with large Russian

companies to create terminal capacity

on their sites;

• the acquisition/construction of new

terminals, including terminal capacity

in ports; and

• the acquisition/leasing of foreign

terminals which service freight flows

going to Russia.

Freight-forwarding

and logistics services

The development of logistics and freight-

forwarding services will be integrated into

the development of the Company’s

trans portation services to create inte-

grated transport and logistic solutions

aimed at end consignors and consignees.

Priority lines of activities will be:

• The development and implementa-

tion of integrated transport and logistics

solutions to deliver container goods for

individual client orders, including the

organization of accelerated multi-modal

transportation on the principles of door-

to-door and just-in-time;

• The broadening of the range of value

added services (including customs

clearance, insurance, security, freight

monitoring, planning and improvement

of deliveries, special conditions of dan-

gerous goods haulage, “last mile”

services, etc.);

• The establishment of new competi-

tive routes for the intermodal delivery

of container goods, providing for

integrated transport and logistics

service for clients at through rates.

Industry diversification

As the Company implements integrated

transport and logistics solutions for its

large clients, it will consider the possibil-

ity of its expansion into related indus-

tries by creating alliances with partner

companies from its sector, as well as via

acquisitions or the development of its

own skills. The Company plans to focus

on the following sectors:

• warehouse services, connected with

activities of Company terminals, includ-

ing transit and customs warehousing, as

well as cargo consolidation;

• 3PL-logistic services for assembly

factories located within the Russian

Federation, where the Company partici-

pates as a forwarder;

• stevedore services in ports, which

participate in international container

routes of the Company;

• freight delivery by sea on the busiest

inter-modal container routes served by

the Company.

Geographical expansion

Geographical expansion is an important

element of the Company strategy and

will be implemented via:

• The expansion of the sales offices

network in Russia and abroad;

• The strengthening of the Company’s

presence in its core markets by setting

up joint ventures, opening new repre-

sentative offices and broadening its

agent network;

• Control over companies whose

activities are connected with transport

and infrastructure asset management

in transport centers and on key contain-

er freight routes.

In the next few years the Company plans

to broaden its presence in regions with

growth potential in freight flows, which

could be harmonized with the current

operations of the Company.


investments 02 5The results of 2008 investment programme implementation

The 2008 investment programme was

aimed at increasing and improving the

Company’s rolling stock fleet, as well as

broadening and upgrading the Compa-

ny’s terminal facilities to consolidate the

position of JSC TransContainer as

Russia’s market leader in rail container

haulage.

The company last year acquired:

• 13,000 ISO containers;

• 1,900 flatcars.

And also:

• 1,000 units of insulated containers

were produced;

• 1,100 units of flatcars were acquired

on financial lease;

• the upgrade of the container terminal

at Zabaikalsk station was completed; and

• cranes, trucks and other equipment

were acquired.

The Company executed a provisional

contract on the purchase and sale of real

estate (office building). The price of the

purchased office building will not exceed

76 million USD (less VAT). In 2008, 1.6

million Rubles were allocated to finance

the purchase of the building (per item

«Construction»). Reimbursement of VAT

on the acquisition of real estate will be

claimed once the property rights have

been registered with the state.


In 2008, the investment programme was

mainly funded via equity capital, as well

as via a bond issue worth 3 bln Rubles

placed in the first quarter.

Principal focus of the investment programme implementation in 2009–2012

The company’s 2009 investment pro-

gramme is budgeted at 5 bln Rubles

(VAT excluded), but could be adjusted

depending on market trends and the

macro-economic situation in Russia.

Investment will be primarily allocated

to raise the efficiency of assets, existing

capacities maintenance and fulfilling

obligations on existing contracts.

1,259 mln Rubles will be allocated

to capital construction, terminal recon-

struction and equipment upgrades.

247 mln Rubles will be allocated to up-

grade the container fleet.

Investment in the upgrade of the flatcar

fleet is planned at no more than

3.5 bln Rubles. The Company plans

to acquire long-base (80-foot) platforms

to compensate the retirement of rolling

stock and fleet structure improvement.

Decisions on the investment in rolling

stock will be made after taking into

consideration market developments.

The investment programme up to 2012

is aimed at further improving the

Company’s asset structure, their

efficiency growth and cementing JSC

TransContainer’s leading position in key

markets.

Financing of the investment programme by type of assets in 2008 (mln Rubles, VAT included)

Asset name 2008

Containers 1 472

Flatcars 3 532

Trucks 297

Power-Hosting equipment 226

Capital construction 3 205

Computers and office machines and equipment 47

Equipment 25

Financial investment 1

Other 99

TOTAL 8 905


risks 02 6Financing risks

The global economic crisis led to a sig-

nificant increase in volatility in the

currency markets, a fall in credit

volumes, higher interest rates and

worsening credit conditions for Russian

borrowers.

Whilst the Russian government’s

stabilization policy enabled the contin-

ued functioning of key financial markets,

their condition is still unstable and

exposed to significant risks. Credit is

available to a very small number of bor-

rowers, but interest rates remain high,

and the offer of a long-term credit is

highly restricted. The ruble rate to the

currency basket fell significantly in the

4th quarter of 2008 to the 1st quarter

of 2009 and is exposed to strong fluctua-

tions. This economic backdrop has

implications for the Company’s borrow-

ings and for the funding of its invest-

ment programme.

Under the circumstances, the Compa-

ny’s management is taking measures

aimed at:

• Cutting currency risk, by minimizing

borrowing in currencies other than the

ruble;

• Strengthening controls over credit

risk in terms of the timeliness of clients’

payments for services and considering

terms of payment postponement to cli-

ents individually, depending on current

liquidity assessment;

• Raising the liquidity of the Company’s

bonds — taking steps to get credit

ratings and to include the Company’s

bonds series 01 into the Lombard list

of the Bank of Russia;

• Credit source diversification — set-

ting credit limits with leading Russian

banks;

• Improving current expenditure on the

investment programme, depending

on trends in the demand for container

deliveries.

Risks connected with rising tariffs

JSC TransContainer’s competitiveness

greatly depends on tariffs for infrastruc-

ture services and traction. These tariffs

are set by government bodies.

Although the tariffs are paid by the

Company’s clients, their increase may

affect the Company’s competitiveness

and financial results as it may make rail


container freight more expensive com-

pared to other types of transportation.

Risks of customs control changes

A large share of the Company’s activities

are accounted for by international freight,

which is affected by the administration

of goods import and export rules set by

the Russian Federation and by neighbour-

ing states. Changes in the level of cus-

toms duties and the method of customs

screening have a material effect on the

stability and volume of goods flow.

Risks of the tax legislation changes

As legal cases have shown, the Russian

tax legislation allows various interpreta-

tions of tax rules. In addition, tax

legislation in the Russian Federation is

subject to frequent change, including the

raising of tax rates and changes to the

order and time of tax calculation and

payment. The Company believes that it

fully conforms with the tax legislation

which relates to its activities, but this

does not remove the potential risk

of differences in opinion with the

regulating body on issues which allow

different interpretations.

Risks connected with anti-trust

regulation of Company activities

The Federal Anti-Trust Service (FAS

of the Russian Federation)

acknowledged that the Company holds

a dominant position in the market for

specialized rolling stock for rail inland

(within Russian Federation borders)

container deliveries over distances

of more than 1,000 km. The Company

operates other transport and forwarding

service markets on competitive terms.

Additionally, the Company’s container

terminals form part of railway stations

which have the status of Sites of Com-

mon Use. At its terminals the Company

acts on behalf of the public carrier

in respect of some activities.

Consequently, the Company must

provide open access to services where it

is acknowledged as a dominant compa-

ny and to services which the Company

undertakes on behalf of the public

carrier at its container terminals.

These aspects of anti-trust regulation

of the Company’s activities may have

a limiting effect when dealing with

commercial issues and have an unfa-

vourable impact on JSC TransContain-

er’s business.

Risk of accidents

In its operations, the Company cannot

fully exclude the risk of emergency

situations when working in dangerous

production facilities. JSC TransContainer

regularly takes measures to provide

industrial, fire and ecological safety and

to prevent and deal with emergency

situations.

Risk of industrial injuries

The Company faces the risk of industrial

injuries to its employees due to the

human error. JSC TransContainer fulfils

the requirements of the Russian

Federation labour legislation with regard

to labour protection and includes

necessary steps to improve labour

conditions in the collective contract,

on an annual basis, to prevent risk.

GLEB FEDULOV

ZHANAR RYMZHANOVA

MAKSIM LIKSUTOV

DAVID HEXTER

DMITRY NOVIKOV

PETR BASKAKOV

GENNA LOZOVSKY

YURY NOVOZHILOV

ALEXEY AVERIN

BOARD OF DIRECTORS OF JSC TRANSCONTAINER

GLEB FEDULOV

ZHANAR RYMZHANOVA

MAKSIM LIKSUTOV

DAVID HEXTER

DMITRY NOVIKOV

PETR BASKAKOV

GENNA LOZOVSKY

YURY NOVOZHILOV

ALEXEY AVERIN

BOARD OF DIRECTORS OF JSC TRANSCONTAINER


Corporate GovernanCe02 7

Improvement in corporate governance

in 2008

In 2008, JSC TransContainer took

a number of steps to develop its corpo-

rate governance systems, including the

following:

• The quantitative and qualitative

structure of the Board of Directors

of JSC TransContainer was changed.

Two independent directors were elected

to the Board in 2008, while another two

represent minority shareholders’

interests;

• The Company set up the Audit and

the Strategy committees, which are ac-

tively working to improve the efficien-

cy and quality of the Board of Directors.

Corporate governance principles

JSC TransContainer strives to follow the best corporate governance practices and

observes the following key corporate governance principles:

Equal and fair treat-ment of shareholders

JSC TransContainer acts fairly towards all its shareholders and refrains from preferring any shareholder group to the detriment of the interests of other shareholders.

Accountability JSC TransContainer’s general director is accountable to the Board of Directors and presents regular reports on his/her activities, which allow an assessment to be made of the ef-ficiency and results of the Company’s activities. The Compa-ny’s Board of Directors is, in turn, accountable to the general shareholders’ meeting of JSC TransContainer.

Transparency JSC TransContainer strives to provide the timely, regular, full and precise disclosure of information on its activities.

Social Responsibility The Company strives to achieve the long-term and sustainable profitability of its business based on a balance between its eco-nomic and social interests.


Provisions, which govern the Committees’

functions, the way their work is organized

and the rights and duties of Committee

members, were approved in 2008;

• Measures to improve the Company’s

transparency and disclosure, in accor-

dance with the Russian Federation’s

legislation requirements and the

Company’s internal documents, were

taken in 2008;

• The deadline for publication of finan-

cial reports under IAS was brought

forward significantly;

• A number of important internal

documents were developed and ap-

proved: the Provision on insider informa-

tion, the disclosure Provision, the

dividend policy Provision and the credit

policy Provision; and

• Measures to implement the practice

of ensuring the responsibility of Board

members and Company management

were taken.

The work that JSC TransContainer did

to improve the corporate governance

system was positively assessed by

Russian and international rating agencies.

Standard & Poor’s assigned the Company

a corporate governance rating GAMMA

5+. The RID-Expert RA consortium

assigned the Company a national corpo-

rate governance rating, with a score of 6.

These scores reflect developed corporate

governance practices with low risk.

The Company will not stop at this stage

and plans to develop its corporate

governance practices in 2009 by improv-

ing the internal control system, introduc-

ing risk-management procedures and

strategic management process.

Governing and control bodies

JSC TransContainer management structure

External auditor General shareholders’ meeting Corporate secretary

Revision commission Board of directors

Internal audit service General director

Strategy committee

Audit committee


Meeting date Form and type of the meeting

Decisions approved

April 30, 2008 (minutes № 5)

Extraordinary, in the presence of all sharehold-ers

Amendments to the Charter extending the deadline of sending the notice on holding a gener-al shareholders’ meeting to shareholders to 30 days and an increase in the number of Board of Directors to 9 were approved.A new Board of Directors was elected.

June 27, 2008 (minutes № 6)

Annual, in the presence of all shareholders

Changes and amendments to the Charter were approved.The annual report for 2007 was approved.The annual financial reports, including the profit and loss report, were approved.The profit received by the Company in 2007 was distributed.The size and order of dividend payment to the Company’s shareholders was set.The size and order of paying recompense to the members of the Board and Audit Commis-sion was set.CJSC BDO Unicon was approved as the Company’s auditor.Members of the Board and Audit Commission were elected.An interested party transaction was approved.

September 25, 2008 (minutes № 7)

Extraordinary, in the presence of all sharehold-ers

A new edition of the Compensation policy for Board members of JSC TransContainer was ap-proved.Amendments and changes to the Charter setting the status of the Strategy and the Au-dit Committees and providing for the creation of an Internal Control Service and the position of a Corporate Secretary of the Company were approved.Changes to the decision of the General annual shareholders’ meeting dated June 20, 2007 (protocol #2 dated July 4, 2007) related to the distribution of profits and losses received in the financial year were approved.

December 29, 2008 (minutes № 8)

Extraordinary, in presence of all shareholders

The decision not to pay dividends by the Company on the first 9 months of 2008 was taken.

General shareholders’ meeting

The general shareholders’ meeting is the supreme body of the Company, which takes decisions on the most important issues

of the Company’s activities.


Board of Directors

The Board of Directors is a collegial

body, which sets the Company’s develop-

ment strategy and controls the activities

of the Company’s executive manage-

ment. The Board of Directors plays

a central role in JSC TransContainer’s

corporate governance system.

From July to December 2008, the Board

of Directors held 11 meetings, including

6 meetings in presentia, in its current

form. In total, 25 Board of Directors

meetings were held in 2008.

Principal decisions taken by the Board

of Directors in 2008:

• The Audit Committee and the Strategy

Committee were set up; members of the

Committees were elected;

• Provisions approved: on the Audit

committee, on the Strategy committee,

disclosures, on the Insider information

policy, on the Dividend policy, on Credit

policy of the Company;

• Principal Directions of Credit Policy

of JSC TransContainer in 2008-2009 and

until 2013 were approved;

• The participation of JSC TransContain-

er in the Coordination Transport Meeting

of states members of the Commonwealth

of Independent States was approved;

• A decision to set up the LLP TransEur-

asia joint venture with SC Kaztransservice

in the Kazakh Republic was taken;

• A prospectus of ordinary placed

registered uncertified shares of JSC

TransContainer with a nominal value

of 1,000 Rubles each in quantity

of 13,894,778 was approved;

• The Company’s performance indica-

tors for 2009 and the main parameters

for the 2009 investment programme

were approved;

• Measures to improve the efficiency

of financial flows management and

mitigation of risks when working with

commercial banks were approved;

• An anti-crisis programme of the

Company was approved;

• Principal activities and targets of JSC

TransContainer strategy development

were approved.


Board of Directors

Elected by the General shareholders’ meeting on 27.06.2008

Dmitry Novikov, Chairman of the Board of Directors

Date of Birth 1969

Education Moscow Finance Institution. Qualification: international currency and credit relations

Citizenship Russian Federation

Positions held in the last 5 years 2007 — current –advisor to JSC TransCreditBank president2007 — current — advisor to JSC RZD president2002 — 2007 — ALROSA Company Limited vice-president

First election to the Board of directors April 30, 2008 (minutes EGSM № 5)

Alexey Averin, deputy Chairman of the Board of directors

Date of Birth 1962

Education Moscow State University of Foreign Affairs under the Foreign Ministry of the USSR, a foreign trade specialist


Positions held in the last 5 years 2005 — current — head of international affairs department of JSC RZD2003 — 2005 — head of consulate department of the Russian Federation Foreign Ministry

First election to the Board of directors April 30, 2008 (minutes EGSM № 5)

Petr Baskakov, General director of the Company

Date of Birth 1961

Education Moscow Institute for Railway Engineers, Management of Carriage Processes on Rail Transport


Positions held in the last 5 years 2006 — current — JSC TransContainer general director2003 — 2006 — director of the state institution "Centre for cargo container traffic" of the Ministry of Railways of the Russian Federation

First election to the Board of directors February 9, 2006 (minutes of founding members meeting)


Maksim Liksutov, independent director

Date of Birth 1976

Education Russian academy of economics named after Plekhanov, finance and credit

Citizenship Estonia

Positions held in the last 5 years 2001 — current — LLC TransGroup AS2002 — 2008 –head of JC «Transgroup Invest AS» representation office 2005 — 2008 — LLC TransGroup — Finance and Investment, general director

First election to the Board of directors April 30, 2008 (minutes of EGSM № 5)

David Hexter, independent director

Date of Birth 1949

Education Oxford University, philosophy, politics and economics;Cranfield School of management, МВА;London University, philosophy

Citizenship Great Britain

Positions held in the last 5 years 2006 — current head of advisory council on investment under Private Equity New Markets Fund2007 — current — KASPI Bank advisory council member 2005 — 2007 — Denholm Hall Investment management Board of directors member2004 — 2007 — KMB Small Business Bank Board of directors member2002 — 2004 — deputy vice-president of the European Bank for Reconstruction and development


Genna Lozovsky

Date of Birth 1972

Education University of Chicago, economics

Citizenship USA

Positions held in the last 5 years 2007 — current — Russian Cinema Holdings director2007 — current — chief partner EmCo Capital Partners2008 — current — FML Limited Board of directors consultant2004 — 2006 — UFG / Delta Private Equity Partners managing director



Yury Novozhilov

Date of Birth 1974

Education St Petersburg State University, economics


Positions held in the last 5 years 2004 — current — first deputy head of finance department of JSC RZD2008 — current — Kit Finans Holding Company (LLC), general director

First election to the Board of directors June 20, 2007 (minutes AGSM № 2)

Zhanar Rymzhanova

Date of Birth 1968

Education Georgetown University; The Kazakh Management Academy, economics

Citizenship Republic of Kazakhstan

Positions held in the last 5 years 2002 — current — senior and head banker of the Transport sector/Russia/Europe-an Bank for Reconstruction and Development


Gleb Fedulov

Date of Birth 1969

Education Chelyabinsk State University, economics of labor (graduation year 1991)


Positions held in the last 5 years 2003 — current — head of affiliates and subsidiaries management department of JSC RZD2003–2005 — management board member of JSC RZD

First election to the Board of directors February 9, 2006 (minutes of founding members meeting)


Members of the Board do not own

Company shares.

The payment of fees and expenses

to the Board of directors is undertaken

in accordance with the Provision on the

Compensation policy for the Board

members o Board members of JSC

TransContainer, approved by the

General shareholders’ meeting of JSC

TransContainer (minutes #7, dated

09.29.2008).

In accordance with the aforementioned

Provision, fees to the Board of directors for

participation in Board meetings

(regardless of their nature) are set at three

times the minimum wage at JSC RZD.

The total amount of fees (including wage

and other payments to general director)

paid to the Board of directors of the

Company amounted to 52,065,662.91

Rubles in 2008.

Committees under the Board

of directors of the Company

Two committees headed by independent

directors, the Audit Committee and the

Strategy Committee, were set up under

the Board of directors.

The Boards committees were set up

in 2008 to provide a detailed work

on issues under competence of the

Board of directors and work on recom-

mendations for the Board of directors.

Strategy committee

The Strategy Committee initially

considers and prepares recommenda-

tions to the Board of directors regard-

ing priority areas of Company’s activi-

ties, the Company’s strategy, and

proposals on how it should be imple-

mented and how its implementation

should be controlled.

Name Position

M.Liksutov Independent director, chairman of the Strategy Committee

P.Baskakov Board member

A.Averin Board member

G.Lozovsky Board member

R.Valeyev Not a Board member, deputy head of affiliates and subsidiaries management department of JSC RZD

Members of the Strategy committee


In 2008, three meetings of the Commit-

tee were held, which considered JSC

TransContainer’s Development Strategy

up to 2017, activity targets and the

parameters of the Company’s invest-

ment programme.

Audit Committee

The Audit Committee initially considers

and prepares recommendations to the

Board of Directors regarding the

Company’s appointment of an external

auditor, control over credibility and

completeness of the Company’s financial

reports, including control over the

fulfillment of Company’s business plans

and budget, the assessment of internal

control system efficiency and risk

management.

In 2008, the Audit Committee held three

meetings, considered the results of the

audit of the Company’s financial report

under IAS for 2007, the selection of an

auditor of the Company’s financial

report under IAS for 2008, as well as

plans and reports of the Company’s

Internal Control Service and its external

auditor.

General Director

Petr Baskakov graduated from the

Moscow Institute for Railway Engineers,

Management of Carriage Processes

on Rail Transport in 1986. After gradua-

tion he took the position of a sector

engineer at the Podolsk Interindustry

company of industrial railway transport

of the Ministry of Railways of the

Russian Federation. In 1988, he became

senior foreman of loading and unloading

works of the company.

In 1989–1993, Mr. Baskakov worked at

Podolsk station on the Moscow Railways,

starting as station duty officer and being

promoted to head of the station, after

which he became the Chief Officer of the

Moskva-Tovarnaya-Kurskaya station

until 1999.

In 1999, he became deputy head of the

transport service centre of the Moscow

Railway. In 2000, he became head of the

container freight department of the

Moscow Railway.

From 2002 to 2003 Mr Baskakov was

Deputy Head of the state institution

“Transport service centre of the

Ministry of Railways of the Russian

Federation". From March to September

2003, he headed the state institution


of the Ministry of Railways of the

Russian Federation.”

From October 2003 to 2006, became

director of “Centre for cargo container

traffic "TransContainer" — a subsidiary

of JSC Russian Railways. And since

March 2006, he has held the post

of General Director of JSC “Centre for

cargo container traffic "TransContainer".

The general director holds no shares

of the Company.

Audit Committee members

Name Position

D.Hexter Independent director, audit committee chairman

Y.Novozhilov Board member

G.Fedulov Board member

S.Andreikin Not a Board member, deputy head of affiliates and subsidiaries management department of JSC RZD


Revision Commission

The Revision Commission of the Compa-

ny is elected by the General annual

shareholders’ meeting until the next

General annual shareholders’ meeting

to control the Company’s financial and

production activity of the Company.

The payment of fees and expenses

to members of the Revision commission

is done in accordance with the Provision

on the Compensation policy for Revision

Commission members of JSC TransCon-

tainer, approved by the General share-

holders’ meeting of JSC TransContainer

(minutes #1, dated 25.12.2006).

A member of the Revision Commission

gets fees and expenses equivalent

to three times the minimum wage at

JSC RZD for participation in each review

(audit) of the Company’s financial and

operating activities. Total fees paid to the

Revision Commission amounted

to 197,730 Rubles in 2008.

Revision Commission line-up

Elected by the General shareholders’ meeting on 27.06.2008 (minutes #6)

Name Position

Anna Ignatova Department head of Zheldorcontrol Center, chairman of the Revision commission

Sergei Davydov Deputy head of accounting department of JSC RZD

Nikolai Zhukov Deputy head of corporate finance depart-ment of JSC RZD

Olga Litvyak Chief auditor of Zheldorcontrol Center

Konstantin Lyulchev Head of financial planning department of the corporate finance department of JSC RZD

Shareholder capital structure


Name Number of shares Share in capital,%

JSC Russian Railways 11,810,561 84.999998

European Bank for Recon-struction and Development

1,294,574 9.245012

Deposit and Clearing Compa-ny Closed company (nominal holder)

799,642 5.754983

JSC Bamivest 1 0.000007

Total 13,894,778 100.00



Dividends

The dividend policy of the Company was

approved in 2008 and provides share-

holders with total transparency regard-

ing distribution and use of the Compa-

ny’s net profit to shareholders.

The dividend level for a period is ap-

proved by the General shareholders’

meeting according to Board of directors’

recommendations and depends, among

other factors, on the Company’s strate-

gy, its investment programme and

financial health as well as general

economic conditions and other factors.

Shareholders’ capital structure by type of shares

Information on each category (type) of shares

Type and category of shares Ordinary registered

Issue form Uncertified

Issue volume 13,894,778

Nominal value of 1 (one) security (in Rubles) 1,000

Information on official registration o f a securities issue

1-01-55194-Е dated May 11, 2006

Dividends paid by the Company

Dividends 2007 (on 2006 results)

2008 (on 2007 results)

Total dividends, mln Rubles 144,2 153,3

Dividend per share 10.38 11.03

Dividends/Net profit, % 10% 10%

Declaration date 04.07.2007 11.07.2008

Date of de facto payment 13.08.2007 22.08.2008

9.2%

84.9%

1 share5.8% JSC RZD 84.999998%

JSC Baminvest 0.000007%

The European Bank for

Reconstruction and

Development 9.245012%

CJSC Depositary Clearing

Company 5.754983%


Bonds

On October 9, 2007, the FCSM of Russia

registered an issue of series 01 docu-

mentary interest-bearing inconvertible

bonds to bearer with obligatory central-

ized deposit (state registration number

4-01-55194-Е).

The Company placed the bonds via

an open subscription on March 4, 2008

on the CJSC MICEX SE. The securities

are on Quotation list B of the CJSC

MI CEX SE.

In the placing, 3,000,000 (three million)

bonds with a nominal value of 1,000 (one

thousand) Rubles each were sold, with

a total value of 3,000,000,000 (three

billion) Rubles. The bonds were sold at

a single trading session.

The total nominal value of the bonds

amounts to 11.29% of the book value

of Company assets as of September 30,

2008. The coupon yield was paid

on 02.09.2008 and totaled 142,110,000

Rubles.

Principal parameters of the bond issue

Guarantor LLC Trans-Invest

Form of issue Documentary

Series 01

Nominal issue volume 3,000,000,000 (three billion)Rubles

Number of bonds in issue 3,000,000 (three million)

One bond nominal value 1,000 (one thousand) Rubles

Tenor 5 years (1,820 days)

Coupon period 182 days

Number of coupons 10

Coupon rate Coupons 1 and 2 — 9.5% (47.37 Rubles per bond) Coupons 3 — 10 — rate is to be determined by the Company

Bond purchase at request of holders with a possibility of further circulation (offer)

No repurchase of bonds from holders in reported period by the Company.

Date of placement March 4, 2008

Listing MICEX


soCial responsiBility 02 8Personnel and social policy

JSC TransContainer’s personnel policy is

aimed at providing the Company with

highly qualified personnel, the creation

of a close-knit team of professionals

capable of quickly and efficiently solve

day-to-day and strategic problems.

The core of the Company’s personnel

policy is an appreciation that human

resource is the Company’s principal

asset. The Company takes care that its

employees see the results of their work

as a contribution to the development

of the Company, linking their efforts

to the Company’s achievements

as a whole.

The Company pays a lot of attention

to reinforcement of personnel motiva-

tion, the creation of an ethical and

economic system of personnel encour-

agement as well as social welfare

of employees.

In 2008, the Company addressed the

following principal issues in its person-

nel policy:

• personnel recruitment;

• the development of personnel,

training, re-training and further training;

• the improvement of personnel

mo ti va tion and remuneration.

Development of personnel, training,

retraining and further training

The Company seeks to further train active,

promising and talented employees, to cre-

ate conditions for the employees to achieve

their full creative potential in work.

Development and training of personnel

is undertaken by a level principle (top

managers, key specialists, managers

and specialists from affiliates, workers)

along the following lines:

• Retraining;

• Further training.

The Company develops its personnel by

investing funds in personnel training

under retraining programmes in large

educational centres, extension courses,

participation in scientific conferences, and

by correspondence courses in institutes,

secondary educational institutions, etc.


During 2008, the Company paid a lot

of attention to top-management training.

Six senior managers of the Company,

including general director, were re-

trained at a Corporate Director course at

the Higher School of Economics. Seven

top-managers and key specialists took

their MBA at the Higher Transport

Business School at the Moscow Institute

for Railway Engineers, and another 32

promising specialists from the Compa-

ny’s affiliates are continuing their

education. Directors of all Company

affiliates were retrained at Modern

Technologies of Company Management

in the Russian Railway Academy under

the Moscow Institute for Railway Engi-

neers. In addition, 55 Company employ-

ees are raising their educational status

at institutes by correspondence. In total,

1,231 employees of the Company upgrad-

ed their education in 2008, an investment

by the Company of 18.3 mln Rubles.

Improvement of personnel motivation

of the Company

Personnel motivation is one of the

principal components of personnel

policy. The following work was done

in this area last year:

To improve the remuneration

system

From April 1, 2008, JSC TransContainer

introduced a new remuneration system

aimed at the attraction and retention

of employees in condition of completion

on regional labor markets.

It comprises four key elements:

• an increase in the minimum wage

to the minimum subsistence level

enacted in the Russian Federation;

• A change in wage structure to in-

crease its guaranteed component. This

guaranteed (tariff) part increased from

30% to 47%;

• The regional regulation of wages,

which takes into consideration local

minimum subsistence levels, wage levels

in industry and its relation to wages

of Company employees in each region,

as well as staff turnover;

• An improvement in the system

of bonuses to achieve a strict correlation

between size of a bonus and an individu-

al’s performances.

The new system maintains a unified

tariff scale to pay wages to workers and

clerks. For top-managers and special-

ists, a salary system, which sets a salary

range for each position, allowing for the

differentiation of salaries depending

on qualification and achievements, was

created.

To increase motivation amongst senior

employees, the Company in 2008 started

to reflect non-economic contributions

to the Company’s development, along

with economic ones: the Company held

contests of professional skills among

employees with key qualifications and

ceremonies to honour winners, and the

opening of a first Honours board.

To provide social privileges

Principal social guarantees provided

to the Company employees are written

into labour contracts.

Expenditure on education upgrade

2nd half-year 2006 2007 2008

Number of employees for retraining 101 834 1,231

Expenditure, mln Rubles 1.5 11.6 18.3


Social guarantees include:

• obligatory and collective voluntary

medical insurance, which provides

Company employees with free medical

aid in medical institutions;

• life insurance to employees working

in dangerous areas;

• reimbursement of railway fares

to the work place, to employees’ sum-

mer houses and to holiday destinations.

For employees from affiliates located far

from the centre, reimbursement

of airline flights to the equivalent value

of the rail journey;

• organization of summer holidays for

children;

• holidays for employees and their

family members in sanatoriums and

vacation hotels at a reduced fee and the

right of employees to partial payment for

tourist travel;

• a partial re-payment of pre-school

costs;

• compensation and privileges for

young specialists, in accordance with

Provision on a young specialist of JSC

TransContainer, approved by the Board

of directors in October 2006.

Social programmes for personnel

To attract and retain employees the

Company undertakes the following

programmes for personnel:

1. The company pension scheme

Delivery of the company pension

scheme is through a contract with the

Blagosostoyaniye private pension fund

under terms of the private retirement

provision for employees of JSC Trans-

Container, approved by the Board

of directors of the Company. Any

employee of the Company can join the

scheme and build-up pension savings

for his future retirement on a parity

basis with the Company. The size of the

pension depends on the level of pay-

ments, job seniority at the Company and

the size of an average monthly wage for

the last two years. The size of the

pension cannot exceed the size of an

average monthly wage in the Company

for the previous year. a total of 1,114

employees of the Company have joined

the scheme, including 176 people

in 2008. 40 Company employees, who

retired from the Company in 2008,

receive a corporate pension.

2. Housing programme

The housing programme provides:

• subsidies to employees on part

of expenditure to pay interest accrued

on mortgage loans;

• corporate support to employees when

they acquire (build) their own living

quarters.

More than 60 people improved their

dwelling conditions within the pro-

gramme.

3. Health programme

The health programme is aimed at

improving Company employees’ health

by supporting their sporting activities.

The Company rents a range of sports

facilities for different kinds of sports

and fitness. a corporate soccer club

and a sports committee under the

leadership of a first deputy general

director of the Company, which

co-ordinates sports activities, were

created. In addition, the Company has

provided facilities for playing tennis

and volley-ball.

Number and quality of personnel

The average number of personnel

employed by the Company during 2008

was 5,547 people, including operating

personnel of 5,255 people.


In the first six months (the second half

of 2006) of the Company’s indepen-

dence the growth in personnel numbers

was significant and amounted to 36.8%

in year-on-year terms. This was caused

by the necessity to secure staff for func-

tional departments. Personnel growth

rates in 2007–2008 were due to the Com-

pany’s geographical expansion in local

and foreign markets, as well as due to the

establishment of a sales network and the

broadening of a range of services.

In 2008, the quality of the Company’s per-

sonnel improved. The number of employ-

ees with a higher professional training

increased by 6.7% to reach 39.8%, while

those with intermediate professional

training rose by 5.8% to 25.3%.

Environment

Environmental protection is one of the

Company’s priorities and a key compo-

nent of its corporate responsibility

activities. JSC TransContainer is actively

introducing an ecology management

programme.

Principal goals of the Company’s ecology

management programme are:

• consistent improvement of the

ecological situation;

• the lowering of harmful substances

emissions into the atmosphere;

• rational use of nature;

• improvement in technological

pro ce sses to cut emissions into the

atmosphere;

• re- use of production and consump-

tion waste;

• to reduce expenditure and losses

when recycling and disposing of waste.

In 2008, JSC TransContainer introduced

an environment protection plan, inc luding:

• development of corporate stan-

dards for ecological safety (the Provi-

sion on ecological management at JSC

TransContainer, the Instruction on the

Order of Dangerous Waste Collection

and Storage);

The dynamics of the number of employees

As at 31.12.2006 As at 31.12.2007 As at 31.12.2008

Number of personnel 4,550 5,404 5,888

Growth, % 36.8%* 18.8% 9%

* Annual rates

The dynamics of ecology safety measures expenditure at the Company

2006 2007 2008

Expenditure, mln Rubles 0.31 4.9 14.3


• measures to lower the level of dan-

gerous waste effect on ecology;

• Company’s specialists were trained

for ecology safety.

Before July 2006, the costs of environ-

mental impact measures were paid by

JSC RZD. In 2008, expenditure on eco-

logical safety included the costs of per-

sonnel training to work with dangerous

waste, as well as expenditure on licens-

es to collect, de-activate and store

dangerous waste.

Charity

JSC TransContainer, as a socially re-

sponsible company, fulfils charity pro-

grammes under the following prin ciples:

• integrated approach to charity

programmes;

• targeting of charity;

• transparent use of funds for charita-

ble aims.

The Company’s priority lines

of charity are:

• Contribution to the protection of moth-

erhood, childhood, and role of the family;

• Social support and the protection

of low-income people;

• Social rehabilitation of disabled people;

• Contribution to sports activities;

• Contribution to education, science,

culture, enlightenment as well as

intellectual development;

• Contribution to industrial charity

programmes throughout Russia.

Principal charity measures in 2008

Name of a charity program Key parts of the programme Expenditures, Rubles

Motherhood and childhood protection

Aid to children's institutions, to families with many children, etc 1,356,959

Disabled Social rehabilitation of disabled and handicapped people 4,603,096

Sports Aid children’s sports schools, participation in organizing sports tourna-ments

62,490,000

Culture Aide in religious building restoration, participation in culture and enlight-enment events

8,702,352

Industry programmes Participation in industry programmes of all-Russia importance 1,346,361

Total 78,498,768



FINANCIAL REPORTBalance sheet .Profit and loss report.Auditor’s report and Revision Commission’s report

64


FINANCIAL REPORTBalance sheet .Profit and loss report.Auditor’s report and Revision Commission’s report

65

66

finanCial report 03

Balance sheet as of December 31, 2008Assets As at the start

of the reporting period

As at the end of the reporting

period

I. FIXED ASSETS

Intangible assets 3,252 381

Fixed assets 13,323,761 17,175,065

Construction in progress 1,182,133 2,124,656

Income yielding investment into tangible assets — —

Long-term financial investment 282,663 283,405

Deferred tax assets 13,342 32,985

Other fixed-assets — —

Total on item I 14,805,151 19,616,492

II. CURRENT ASSETS

Inventory including: 608,094 568,630

• raw materials, supplies and other same valuables 161,317 226,843

• rearers and fatteners — —

• period expenses 48 —

• finished products and goods for resale 617 1,086

• shipped goods — —


Assets As at the start of the reporting

period

As at the end of the reporting

period

• prepayments 444,624 340,701

Other inventory and expenditure 1,488 —

Value added tax on acquired valuables 349,377 538,748

Receivables (payments on which are expected in more than 12 months after the reporting date — —

• including receivables from customers and buyers — —

Receivables (payments on which are expected within 12 months after the reporting date) 3,046 352 5,540,190

• including receivables from customers and buyers 945,280 1,206,196

Short-term financial investment 1,255,157 13,907

Cash 202,336 443,321

Other current assets 26,745 194,840

Total on item II 5,488,061 7,299,636

BALANCE 20,293,212 26,916,128

68 03 Financial report

Liabilities As at the start of the reporting period

As at the end of the reporting period

III. CAPITAL AND RESERVES

Shareholder capital 13,894,778 13,894,778

Shares repurchased — —

Additional capital 103,881 103,881

Reserves, including: 72,099 148,691

• reserves accumulated in accordance with legislation 72,099 148,691

• reserves accumulated in accordance with the statutory documents — —

Retained income (uncovered loss) 2,695,157 4,915,308

Total for paragraph III 16,765,915 19,062,658

IV. LONG-TERM LIABILITIES

Borrowings — 3,093,690

Deferred tax liabilities 62,465 208,131

Other long-term liabilities — —

Total for paragraph IV 62,465 3,301,821

V. SHORT-TERM LIABILITIES

Borrowings — —

Payables, including payables from: 3,463,918 4,550,719

• suppliers and contractors 854,548 1,733,540

• payrolls 54,292 38,284

• debts to state extra-budgetary funds 15,660 9,559

• tax and fees arrears 103,674 126,675

• other creditors 2,435,744 2,642,661

Debts to shareholders on dividends — —

Deferred revenue 914 930

Reserve for future expenses — —

Other short-term liabilities — —

Total for paragraph V 3,464,832 4,551,649

BALANCE 20,293,212 26,916,128


profit and loss report of the Company for 2008 Index For the reporting period For the same period

a year ago

Profit and expenditure on ordinary activities Revenue (net) from sale of goods, products, work, service (less value added tax, excise and similar obligatory payments)

20,226,468 13,431,405

Cost of goods, products, work, service (15,572,373) (10,668,232)

Gross profit 4,654,095 2,763,173

Commercial expenses (213,400) (122,141)

Management expenses — —

Profit (loss) from sales 4,440,695 2,641,032

Other revenue and expenses

Interest received 98,115 117,632

Interest paid (256,702) —

Revenue from participation in other companies — —

Other revenues 2,161,567 854,980

Other expenses (2,364,719) (1,027,304)

Profit (loss) before tax 4,078,956 2,586,340

Deferred tax assets 19,644 4,104

Deferred tax liabilities (145,678) (58,710)

Current profit tax (1,272,398) (999,735)

Fines, penalties to the budget, result of activities liable for uniform tax on imputed income

(288) (148)

Net profit (loss) of the reporting period 2,680,236 1,531,851

NOTE.

Fixed tax liabilities (assets) 419,482 433,620

Basic earnings (loss) per share 0 0

Diluted earnings (loss) per share 0 0


Audit report on the accounts of the joint-stock company

“Centre for cargo container traffic “TransContainer” based

on the results of activities in 2008

An audit of the 2008 accounts of the joint-stock company

“Centre for cargo container traffic “TransContainer” (hereinaf-

ter — the Company) was conducted by LTD BDO Unicon under

contract № Ю-0120-0773-08 dated 28.10.2008, concluded

pursuant to the decision of the Company’s General Sharehold-

ers’ Meeting to approve LTD BDO Unicon as the official auditor

(Minutes of the annual General Shareholders’ Meeting № 6

of 06/27/08).

Brief information on LTD BDO Unicon

LTD BDO Unicon was registered by Inspectorate № 26, for the

Southern Administrative District of Moscow, of the Ministry for

Taxes and Duties of the Russian Federation.

Certificate series 77 № 006870804 on the insertion of an

entry into the Unitary State Register of Legal Entities

of 29/01/03, under principal state registration number

1037739271701.

Certificate series 77 № 006871546 on the state registration

of changes to the constituent documents of a legal entity

of 17/09/03, under state registration number 2037726023498,

issued by Inspectorate № 26, for the Southern Administrative

District of Moscow, of the Ministry for Taxes and Duties of the

Russian Federation.

Business address:

Section 11, Block 1, 125 Warsaw Highway,

117545 Moscow

Tel.: (495) 797 5665

Tel./fax: (495) 797 5660

E-mail: [email protected]

Website: www.bdo.ru

General director Andrei Dubinsky

LTD BDO Unicon holds license number E 00547 of 25/06/2002

to conduct auditing activities issued by the Finance Ministry

of the Russian Federation, which is valid until 24/06/2012.

LTD BDO Unicon is an independent national auditing company

that is part of the international network BDO.

LTD BDO Unicon is a member of the professional auditing

association “Institute of Professional Accountants and Audi-

tors of Russia” Non-Commercial Partnership, accredited with

the Finance Ministry of the Russian Federation pursuant

to Decree № 152 of 24/07/02 (Certificate № 7 of accreditation

of a professional auditing association with the Finance Ministry

of the Russian Federation).

Senior partner Natalya Kharlamova is authorized to sign the

audit report, on the basis of power of attorney № 9-01/2008-Yu

of 01/01/08.

Auditor Alexandr Lantsov, auditing director, headed the audit

of the Company.

auditor’s report


Brief information on JSC “Centre for cargo container traffic

“TransContainer”

The joint-stock company JSC “Centre for cargo container

traffic “TransContainer” was registered by Interdistrict

Inspectorate № 46 for Moscow of the Federal tax Service on 4

March 2006, certificate of the state registration of a legal entity

series 77 № 009200861.

Business address: 6/2 Kalanchevskaya street, 107174, Moscow

1. We conducted an audit of the attached accounts for 2008,

on 41 pages:

• Balance-sheet (Form № 1) — on 3 pages;

• Profit-and-loss statement (Form № 2) — on 2 pages;

• Statement of changes to capital (Form № 3) — on 4 pages;

• Statement of cash flow (Form № 4) — on 2 pages;

• Appendix to balance-sheet (Form № 5) — on 6 pages;

• Explanatory note — on 25 pages.

These accounts were prepared by the Company’s management

in accordance with the norms prescribed by Federal Law №

129-FZ of 11/21/96 “On accounting” (as subsequently amend-

ed and expanded), the Accounting Regulations, Order of the Fi-

nance Ministry of the Russian Federation № 67n of 07/22/03

“On the forms of accounting organizations”, and other regula-

tory enactments of the Russian Federation regulating the

procedures for keeping and producing accounts.

Responsibility for organizing accounting, and for ensuring that

the legislation of the Russian Federation is complied with

when economic transactions are accomplished, lies with the

Company’s Director Petr Baskakov.

Responsibility for formulating accounting policy, for keeping

the accounts and for ensuring that complete and accurate

accounts are submitted on time lies with the Company’s Chief

Accountant Konstantin Kalmykov.

The auditor’s job is to express an opinion on the essential

accuracy of submitted accounts and on whether the account-

keeping procedures comply with the legislation of the Russian

Federation. It was not his aim to express any opinion on the

extent to which the Company’s activities complied with the

legislation of the Russian Federation nor to assess how

efficiently the Company’s management conducted its business.

Our opinion may not be viewed by the user of the accounts

as an expression of confidence in the continuity of the Compa-

ny’s activities in the future.

2. The audit was conducted in accordance with Federal Law №

119-FZ of 08/07/01 “On auditing activities” and with the

federal rules (standards) on auditing activities that were

approved by Decree of the Government of the Russian

Federation №696 of 09/23/02 (as subsequently amended and

expanded), other regulatory enactments regulating auditing

activities, and in-house auditing standards and procedures.

When conducting the audit, we were guided by the internal

rules (standards) of the accredited professional auditing

association “Institute of Professional Accountants and Audi-

tors of Russia.” The audit was planned and conducted in such

a way as to be reasonably confident that the accounts did not

contain any significant distortions.

The audit was conducted on a selective basis, and included

an investigation based on testing the evidence supporting the


figures in the accounts and the information on financial and

economic activities contained therein, an assessment of ad-

herence to the accounting principles and rules that apply

to the preparation of accounts, an assessment of the principal

estimated figures received by the Company’s management,

and an assessment of the presentation of the accounts.

We believe that the audit we conducted gives sufficient

grounds for expressing our opinion that these accounts are

in all significant respects accurate and that the account-keep-

ing procedures complied with the legislation of the Russian

Federation.

3. In our view, the Company’s accounts accurately reflect,

in all significant respects, the financial position as of Decem-

ber 31, 2008 and results of financial and economic activities

in the period between January 1, and December 31, 2008,

inclusive.

10.03.2009

Senior Partner

Auditor

N. Kharlamova

Certificate of competence in general auditing of the Finance

Ministry of the Russian Federation № 025432, issued pursuant

to a decision of the Central Certifying & Licensing Auditing

Commission of the Finance Ministry of the Russian Federation

of 03/25/99, extended indefinitely from 03/25/02 (minutes №

104 of the Central Certifying & Licensing Auditing Commission

of the Finance Ministry of the Russian Federation).

А. Lantsov

Certificate of competence in general auditing of the Finance

Ministry of the Russian Federation № 040070, issued pursuant

to a decision of the Central Certifying & Licensing Auditing

Commission of the Finance Ministry of the Russian Federation

of 11/28/01, extended indefinitely (minutes № 100 of the

Central Certifying & Licensing Auditing Commission of the

Finance Ministry of the Russian Federation).

73

In accordance with Article #85 of the Federal Law on Joint

Stock Companies, the Revision Commission Regulation of JSC

TransContainer, approved by the general shareholders’

meeting of JSC TransContainer, (hereinafter referred to as

Company), the plan of operations of the Revision Commission

of JSC TransContainer, approved by the decision of the

Company’s Revision Commission (minutes dated 08.05. 2008,

#1), composed of chairwoman of the Revision Commission

A.Ignatova, Revision Commission members S. Davydov,

N.Zhukov, O.Litvyak, as well as of ad hoc specialists A. Arutyu-

nyan, Y. Voronina, K.Karpenko, a routine inspection of Joint

Stock Company TransContainer’s business and financial

performance in 2008 was carried out.

The inspection took place in the central office as well as in the

Company’s subsidiaries from 02.03.2009 to 06.04.2009.

The base of the inspection: the Company’s business and

financial performance in 2008.

Sources of information on the Company’s business and

financial performance were: business and financial docu-

ments, including accounts, underlying accounting instru-

ments, banking documents, contracts, etc.

The inspection was done in the form of a sampling inspection

of accounting documents and accounting reports of the

Company.

Based on the findings of the inspection the Revision Commis-

sion has all the necessary facts to confirm the data in the

reports and other financial documents, including JSC Trans-

Container’s annual report for 2008.

Chairman of JSC TransContainer’s

Revision Commission A. Ignatova

April 6, 2009

revision Commission’s report

Conclusions of the Revision Commission following the results of an audit of Joint Stock Company TransContainer’s business and financial performance in 2008

Moscow April 6, 2009


Information on major and related party transactions. Subsidiaries and affiliates. Glossary. Corporate details

ADDITIONAL INFORMATION

74


Information on major and related party transactions. Subsidiaries and affiliates. Glossary. Corporate details

ADDITIONAL INFORMATION

75

76

aDDitional information 04

Type of transaction

Parties to transaction

Subject Price Validity period Body that approved the transaction

Interested party

Transactions accomplished by the Company in the reporting year and acknowledged major transactions in accordance with on Joint Stock Companies Federal Law

There were no such transactions

Transactions accomplished by the Company in the reporting year and acknowledged related party transactions in accordance with on Joint Stock Companies Federal Law

additional Agree-ment 1 to services Agreement № 296 dated 29.12.07

JSC Russian Railways

Change in the price of the service agreement to organize health care and preventative treat-ment and organization of summer holidays and rehabilitation of children of Company employees

On request, in accor-dance with Settlement and additional agree-ments

Upon signature un-til 31.12.2008, effect of the agreement cov-ers relationship of par-ties which appeared from 01.06.2008

Board meeting dated 28.11.2008 (minutes № 31)


additional Agree-ment № 2 to ser-vices Agree-ment № 296 dated 29.12.07


Change in the price of the service agree-ment to organize health care and pre-ventive treatment and organization of sum-mer holidays and re-habilitation of children of Company employees

On request, in accor-dance with Settlement and additional agree-ments

Upon signature until 31.12.2008, the agree-ment covers rela-tionship of parties which appeared from 01.06.2008



information on major and related party transactions that were accomplished in 2008


Type of transaction



Interested party

Agreement on in-troducing changes into contract dated 09.01.2008 № 4380

JSC Russian Railways (Main computer cen-tre)

Integrated information servicing of the rolling stock owner

578.00 Rubles for soft-ware and technology maintenance of one task a month; 540.00 Rubles for each ser-vice of technical main-tenance of means of computer technol-ogy

Upon signature of agreement until full satisfaction of all obli-gations on the agree-ment of all parties



Agreement on in-troducing changes into contract dated 14.01.2008 № 4208


Payment on main-tenance service of a building located at 6/2, Kalanchevskaya st, Moscow

277,785.01 Rubles a month, VAT inclusive

From the date of sign-ing by the Parties and valid until expiration date of the Agree-ment. The addition-al agreement covers relationship of par-ties incurred from 07.07.2008



Agreement JSC Science and Research Insti-tute for Railway Transport (JSC VNIIZhT)

Calculation of norm of damaged freight cars remaining after planned types of re-pairs in 2008

236,000..00 Rubles, VAT inclusive

From the date of sign-ing by the Parties and valid until expiration date of the AgreementTo extend the agree-ment to relation-ships incurred from 01.01.2008.



Agreement CJSC LOKOMO-TIV football club

Lease of a football field with a total area of 4,000 sq. m, assig-nation of a room for judges of the LOKO-MOTIV Central Stadi-um, a locker room and services of a football coach

24,525.42 Rubles, VAT inclusive, for each visit

From the date of sign-ing by the Parties until December 26, 2008



Agreement JSC Russian Railways (Trans-Container- an af-filiate of JSC RZD )

Purchase and sale of real estate

52,292,069.00 Rubles, VAT inclusive

Becomes valid fro the date of signing by the Parties and valid until full satisfaction of all obligations on the agreement of all par-ties




Type of transaction



Interested party


Advertisement ser-vices

885,500.00 Rubles, VAT inclusive

From the date of sign-ing the agreement un-til November 30, 2008. Extend the agreement on relations incurred from February 29, 2008.



Agreement JCS The Gudok Newspaper

Production of 5 (five) issues of corporate newspaper


From the date of its signing by the Par-ties until December 31, 2008. Extend the agreement on rela-tions incurred from February 1, 2008



Agreement JCS The Gudok Newspaper

Production of the fourth issue of a cor-porate magazine


From the date of its signing by the Par-ties until December 31, 2008. extend the agreement on rela-tions incurred from February 1, 2008г.



Agreement JSC Russian Railways

The assignment of leasing agree-ment №247-3-7 dated 31.12.2004 .


Upon signature of agreement until full satisfaction of all obli-gations on the leasing agreement



Additional Agree-ment №1 to ser-vice contract dated 28.03.2008 № 821

JCS The Gudok Newspaper

Editing and publish-ing of Deliver corpo-rate magazine № 5 and № 6, production of supplements for the Transport of Rus-sia exhibition, supple-ments to TOC Europe and TLC exhibitions


From the date of sig-nature by the Parties until December 31, 2008.




Type of transaction



Interested party


Planned maintenance of freight cars

The price of car-house, complete over-haul of a freight car is set by the condition of a freight car based on de facto repairs. The price of repairs is set in the Repairs price list.

From the date of the agreement signature by the Parties until De-cember 31, 2008.

Board meet-ing dated April 11, 2008 (minutes № 16)


Agreement JSC Russian Railways (Trans-Container- an af-filiate of JSC RZD )

Purchase of property (containers in leasing)

160,688, 815.00 Ru-bles, VAT inclusive

From the date of the agreement signature by the Parties until July 1, 2008




Tests of dielectric ar-ticles, tools with insu-lated grips, clamp-on meters

Upon work delivery, under bill

From the date of the agreement signature until 12.31.2008 with possibility of extension to next calendar year

Board meeting dated July 28, 2008 (minutes № 23)



Drinking water delivery and wastewater ad-mission

10,037.17 Rubles a year, VAT inclusive

From the date of its signing by the Par-ties until December 31, 2008. Extend the agreement on rela-tions incurred from January 1, 2008.



Additional Agree-ment to Agree-ment dated Janu-ary 1, 2007. № 32


Additional agreement to telecommunications agreement

3,009 Rubles (inclu-sive VAT in the amount of 18% — 459.00 Ru-bles)

For indefinite term from the date of the agreement signing by the parties




Services on organiz-ing watching a match (food, premises, park-ing, VIP-suit)


From the date of sign-ing the agreement by the Parties until De-cember 31, 2008




Type of transaction



Interested party

Agent Agreement Oy Container-Trans Scandina-via Ltd.

Performing legal and other actions connect-ed with freight organi-zation and monitoring, transshipping, delivery, handling and feasibility study, on orders from Principal on the terri-tory of Finland

Agent’s fee for each loaded container un-der agreement: • 20-foot– 30 (thirty) euro;• 30-, 40-, 45-foot uni-versal or tan-contain-er — 60 (sixty) euro; for special freight — 65 (sixty five) euro

From the date of sign-ing the agreement until June 30, 2008 inclusive. Extend the agreement to relations incurred from April 1, 2008.


Baskakov P.V. general director of JSC Trans-Container


Sublease of part of a land plot at Magni-togorsk-Gruzovoi sta-tion (65,386 sq.m.)


Eleven months from the date of signing the agreement by the Parties




Sublease of a land plot in the settlement of Zabaikalsk (170, 300 sq.m.)

The price of the sale of the land plot sub-lease entitlement: 8,291,375 Rubles, VAT inclusive

From the date of sign-ing the agreement by the parties until Feb-ruary 28, 2009 г. Ex-tend the agreement on relations incurred from April 1, 2008.




Relabeling of contain-er platforms owned by JSC TransContainer with marking cars with new numbers.

The price of one plat-form 600.43 Rubles, VAT inclusive

From the date the agreement was signed until December 31, 2008. Extend the agreement on relation-ships incurred from 01.02.2008



Agreement JSC Roszheldor-stroi (JSC RZD-stroi)

Heat supplies of prem-ises at Chelybinsk-Grusovoi station


From the date the agreement was signed by the parties until September 30, 2008. Extend the agreement on relationships in-curred from January 1, 2008.


JSC Russian Railways, Fedu-lov G.M., Novo-zhilov Yu.V., JSC TransContainer board of direc-tors members


Organization of loading and unloading works, truck services

30,000,000 Rubles, VAT inclusive

From the date of agreement sign-ing by the parties until February 28, 2009.




Type of transaction



Interested party

Agreement LLC TransGroup ASLLC Haskon-ing Consultants, Archtects and Engineers

Development of a busi-ness plan to Container Terminal Development in the port of Zarubino Project

43,173,840 Rubles, VAT inclusive

The agreement is val-id from the moment of its signature by the parties and remains valid until full satisfac-tion of all obligations on the Agreement


Liksutov M.S., JSC TransCon-tainer board of directors member


Transport forwarding services

118,000 Rubles, VAT inclusive

From the date of sign-ing the agreement un-til December 31, 2008




On reimburse-ment of expenditures on public facilities of heating and water consumption

157, 055.60 Rubles a year, VAT exclusive

From the date the agreement was signed by the parties until De-cember 30, 2008 with a possibility of a fur-ther extension. Extend the agreement on re-lationships incurred from June 1, 2008.



Agreement ROSINKAS, CENTRAL BANK of THE RUS-SIAN FED-ERATION, JSC ТransCreditBank

Cash collection in JSC TransContainer busi-ness units and deposit in the Bank

8 Rubles. 26 kopecks, VAT inclusive from each transported one thousand Rubles, but no less than 4,248 Ru-bles. 00 kopecks, VAT inclusive for temporary keeping pouches with cash 118 Rubles. 00 kopecks.

The agreement be-comes valid from the date of its signature and until December 31, 2008.




Public services and re-imbursement of main-tenance expenditures


From the date the agreement was signed by the parties until 31.12.2008 with a pos-sibility of a further ex-tension. Extend the agreement on relation-ships incurred from April 1, 2008.




Type of transaction



Interested party


Mail delivery 100,000 Rubles (in-cluding VAT of 18% — 15, 254.24 Rubles)

From the date the agreement was signed until 31.12.2008



Additional agree-ment to the con-tract dated June 20, 2006, № 0082-6

JSC TransCred-itBank in the name of its Sa-mara affiliate

Russian Federation currency bank account servicing

— From the date of sign-ing until termina-tion date of a Contract on a banking account in Russian Federation currency № 0082-6 dated June 20, 2006.


JSC Russian Railways, Novo-zhilov Yu.V., JSC TRansContainer board member

Agreement JSC Science, Re-search, Design and Engineer-ing Institute for Information Sys-tem Develop-ment , Automa-tion and Tele-communications on Railways (JSC NIIAS)

Maintenance of an automated system of surplus fees for freight accrued at station ac-counting


The agreement is valid from the moment of its signature by the par-ties and remains valid until full satisfaction of all obligations on the Agreement. Extend the agreement on relation-ships incurred from January 1, 2008.




Maintenance of auto-mated system of con-tainer freight payment control


The agreement is valid from the moment of its signature by the par-ties and remains valid until full satisfaction of all obligations on the Agreement. Extend the agreement on relation-ships incurred from January 1, 2008




Rent (1/2, Privokalnaya ploshchad, 220 sq.m.)


From the date the agreement was signed for 11 months. Extend the agreement on re-lationships incurred from April 1, 2008




Type of transaction



Interested party

Additional agree-ment to the con-tract on telecom-munications ser-vices dated Janu-ary 01, 2007, № КYu-95а/yur (№32)


Telecommunications services

Under terms of agree-ment КYu-95а/yur (№32)

From the date the agreement was signed until expiration date. Extend the agreement on relationships in-curred from April 1, 2008



Additional agree-ment to the con-tract dated July 01, 2007 № КYu-188b/yur (№107)


Railway ATS telecom-munications servic-es with access to city telecommunications

Under terms of agree-ment КYu-188b/yur (№107)

From the date the agreement was signed for 11 months. Extend the agreement on re-lationships incurred from July 1, 2008



Agreement JSC Roszheldor-proekt

Development of de-signing estimates for the project of Recon-struction of a Con-tainer Terminal of the Agency at Bazaikha station of JSC Trans-Container at the Kran-soyarsk railway. Work-ing draft


From the date of sign-ing the agreement un-til full satisfaction of all obligations on the Agreement.



Agreement of de-nouncement of a rent agree-ment № TsRIA/4/А/ 0911010000/ 07/002295 dated January 06, 2007


On denouncement of a rent agreement on real estate at 23, Nizhe-Khlebnaya Sa-mara

— From July 15, 2008 JSC Russian Railways


Adjustment of a circuit exchange

729.63 Rubles, VAT in-clusive

From the date of sign-ing the agreement un-til full satisfaction of all obligations on the Agreement

Minutes #28 of a board of direc-tors meeting dated 27.10.08.



Advertising services 21,000,000.00 Rubles, VAT inclusive

From the date the agreement was signed until December 31, 2008




Type of transaction



Interested party


Maintenance costs re-imbursement

1,076.76 Rubles a month (VAT inclusive)

From the date the agreement was signed until September 30,2008. Extend the agreement on relation-ships incurred from November 9, 2007





Upon bills From the date the agreement was signed until December 31, 2008



Agreement LLC TransGroup AS

A joint investment project to build a Ter-minal in the port of Zarubino

Indefinite period Board meeting dated July 28, 2008 (minutes № 23)

Liksutov M.S., JSC TransCon-tainer board member


Office rent (Yekater-inburg)


From the signature date until 31.05.2009. Extend the agree-ment on relationships incurred from July 1, 2007




Purchase and sale of containers excluded from JSC TransCon-tainer’s inventoried stock

86, 445.00 Rubles, VAT inclusive





Rent of non-residen-tial premises (Taltsy station)

15,556 Rubles a month, VAT exclusive

11 months from the date of signature of real estate han-dover act




Real estate rent (Biysk) 54,341.76 Rubles a month, VAT exclusive

From the date of agreement signa-ture 11 months




Reimbursement of SG&A and public services costs


From the date of sig-nature for all the peri-od of the non-residen-tial premises use




Type of transaction



Interested party

Agent agreement Oy Container-Trans Scandina-via Ltd.

Performing legal and other actions connect-ed with freight organi-zation and monitoring, transshipping, deliv-ery, handling and fea-sibility study, as well ads efficient utilization and safety on the ter-ritory of Finland of JSC TransContainer’s con-tainers and platforms

Agent’s fee for each loaded container un-der agreement: • 20-foot– 30 (thirty) euro;• 30-, 40-, 45-foot uni-versal or tan-contain-er — 60 (sixty) euro; for special freight — 65 (sixty five) euro

From 01.09.2008 until 31.12.2008 with a pos-sibility of an automatic extension


Baskakov P.V. general director of JSC Trans-Container


Delivery of a Russian container (3 items) which was excluded from inventory

16,731.00 Rubles, VAT included





Sublease of a land plot with an area of 17,217sq.m. (Sara-tov)

52.72 Rubles a year, VAT inclusive

From the date of its state registration until 25.07.2054.



Agreement JSC RZDstroi Heating of premises at Chelyabinsk-Grusovoi station from October 2008 until May 2009.

151,585.35 Rubles, VAT exclusive

Becomes valid from the date of its signa-ture by the Parties and until May 30, 2009.


JSC Russian Railways, Fedu-lov G.M. and Novohilov Yu.V., JSC TransCon-tainer board of directors members

Agreement JSC Russian Railways (Trans-Container, an af-filiate of JSC RZD)

Purchase and sale of real estate in ac-cordance with Supple-ment №1





Agreement JSC Russian Railways (Trans-Container, an af-filiate of JSC RZD)

Purchase and sale of property in accor-dance with Supple-ment №1


From the date of sign-ing the agreement un-til December 31, 2008




Type of transaction



Interested party


Property lease (Ros-tov-on-Don)


For 11 months from the date of signature of the agreement. Ex-tend the agreement in relationship in-curred from April 1, 2008





118,000 Rubles VAT in-clusive

From the date the agreement was signed by the parties until De-cember 31, 2008



Agreement LLC TransGroup AS

Confidentiality agree-ment

— From the date it was signed by the parties until December 31, 2012 inclusive


Liksutov M.S., JSC TransCon-tainer board member


Property lease (Nal-chik)


From the date of agreement sig-nature until March 31, 2009. Extend the agreement in relation-ship incurred from April 15, 2008




Delivery of medium-tonnage containers excluded from inven-toried stock (15 items, 5-ton)

110,790.00, VAT in-clusive





Reimbursement of op-erational costs on rent of Blagoveshchensk ELS

Under tariff From date of signature of the agreement until expiration date of Rent Agreement dated 24.07.2008, № 129




Reimbursement of ex-penditures on public services

16,033 Rubles a month, VAT exclusive

From the signature date for the period of rent of the prem-ises. The agreement covers relationship of parties incurred from August 1, 2008




Type of transaction



Interested party


Lease of a high-ton-nage platform with an area of 2,230 sq.m. (Kutum station)

535,200.00 Rubles a year VAT inclusive

11 months from the date of signature and extends of relation-ship between parties de facto incurred from March 1, 2008.

Board meeting dated 09,04.08 (minutes № 25)



Lease of a contain-er range with an area of 2,010 sq.m. (Kutum station)

482,400 Rubles a year VAT inclusive

For 11 months from the date of signature of the agreement. Ex-tend the agreement in relationship de facto incurred from March 1, 2008




Purchase of health tour packages

198,156 Rubles. not li-able to VAT

From the moment of signature by the parties and valid until December 31, 2008.The agreement is ex-tended on relationship of parties incurred from May 26, 2008




Delivery of 10/UUK-5 containers

61,631.4 Rubles VAT inclusive

From the moment of signature by the parties and valid until December 31, 2008.The agreement is ex-tended on relationship of parties incurred from October 1, 2008

The Agreement is extended on rela-tionship of parties incurred from Oc-tober 1, 2008



Telegraph services Under the Tariffs for Telecommunications Services provided by the Saratov Affiliate of JSC Volga Telecom price list

From the moment of signature until 12. 31.2008 with an annu-al automatic extension for one calendar year. The agreement is ex-tended on relationship of parties incurred be-fore its signature from 01.07.2008.




Type of transaction



Interested party

Agreement JSC TransCred-itBank

Corporate cards ser-vicing

Under current tariffs From the moment of signature by the parties until the mo-ment of final settle-ment by the parties under terms of the Agreement


JSC Russian Railways, Novo-hilov Yu.V., JSC TransContainer board of direc-tors members



The installment of the main station — 7,080 Rubles, VAT inclusive. Monthly fee for tele-phone services 277.3 VAT inclusive

Valid from the mo-ment of its signature by the parties and un-til its denouncement.Valid for relation-ships incurred before 01.08.2008.





277.3 Rubles a month, VAT inclusive

From the moment of signature until 12. 31.2008 with an annu-al automatic extension for one calendar year. The agreement is ex-tended on relationship of parties incurred be-fore its signature from 07.01.2008.



Agreement JSC Pervaya Nerudnaya Kom-paniya


Under JSC TransCon-tainer tariffs

From the moment of signature until 31.12.2008. The agree-ment is extended on relationship of par-ties incurred from September 5, 2008.

Board meet-ing dated 27.1008 (minutes № 28)

JSC Russian Railways, Fedu-lov G.M., mem-ber of the board of directors of JSC Trans-Container



Under the Telecommu-nications Services Pro-vided by JSC TsentrT-elecom Price List

For a year since sig-nature of the agree-ment by the parties. The agreement covers relationships incurred from 08.22.2008.




Services of a mobile radio on a private net-work

8,412.04 Rubles a month, VAT inclusive and 2,135.80 Rubles, VAT inclusive one-off

From the moment of its signature by both parties and valid until 31.12.2008.




Type of transaction



Interested party


Full repairs of carrying roller girder КК-20-25-6 items, КК-6,3 — 2 items.







220,000 Rubles, VAT inclusive

From the date of sig-nature by the parties until December 31, 2008. The agreement is extended on rela-tionship of parties incurred before it be-came valid on July 1, 2008.



Agreement CJSC TransTele-com

Long-distance and in-ternational telecom-munications services

Under tariffs Becomes valid from the moment of its sig-nature by the parties and is valid until de-nounced by one of the parties


JSC Russian Railways, Fedu-lov G.M., board of directors member of JSC TransContainer



Under tariffs оf the Saratov affiliate of JSC VolgaTelecom

Becomes valid from the moment of its sig-nature by the parties and valid until Decem-ber 31, 2008, on settle-ment until complete performance. The agreement is extended on relationship of par-ties incurred from July 1, 2008.

Board meeting dated 17.11.08 (minutes № 29))




26,596.02 Rubles, VAT included

From the date of sig-nature by the parties until December 31, 2008. The agreement is extended on rela-tionship of parties incurred before it be-came valid on August 1, 2008.




Type of transaction



Interested party


Telegraph services Under tariffs of the telecommunications operator according to a bill

From the date of sig-nature by the parties until December 31, 2008. The agreement is extended on rela-tionship of parties incurred before it be-came valid on August 1, 2008.




Dining car feeding ser-vices on the Chita-Za-bailkalsk-Chita route


The agreement be-comes valid from the moment of its sig-nature and is valid until full satisfac-tion of all obligations on the Agreement. The agreement is extended on relationship of par-ties incurred before it became valid from Oc-tober 1, 2008.




Telegraph services Under tariffs оf the Voronezh affiliate of JSC TsentrTelecom

From the date of sig-nature until December 31, 2008, with a fur-ther extension. The agreement is extended on relationship of par-ties incurred from Au-gust 1, 2008.





Under the Tariffs on Services of Tele-graph and Tariffs on Principal Services of Telecommunications price list

The agreement be-comes valid from the date of its signature by the Parties and is valid until 01.06.2008. The agreement is ex-tended in accordance with p. 2, art. 425 of the Russian Federa-tion Civil Code, covers relationships of the parties incurred from 02.06.2008.




Type of transaction



Interested party



Under JSC TransCon-tainer rates

From the moment of signature until De-cember 31, 2008 and with a further exten-sion. The agreement is extended on rela-tionship of parties in-curred from January 1, 2008.



Agreement JSC TransCred-itBank

The service of subsidy payout on the com-pany’s employees’ ac-counts

— The agreement be-comes valid from the date of its signature and is valid for 2 (two) years from the date of signature


JSC Russian Railways, Novo-hilov Yu. V. JSC TransContainer board member


Reimbursement of op-eration expenditures

Upon bill From the moment a rent agreement be-comes valid and is valid until expiration of the rent agreement






From the moment of signature until De-cember 31, 2008. The agreement is extended on relationship of par-ties incurred from Au-gust 21, 2008.





Under the Price List of telecommunications services of the Railway regional centre

From the date of sig-nature and for an in-definite period of time



Agreement NUZ Dorozhna-ya Klinicheskaya Bolnitsa hospi-tal at the station of Gorky of JSC RZD

Charity 311,407 Rubles, not li-able to VAT

From the date of sig-nature and until full satisfaction of all obli-gations on the Agree-ment



Type of transaction



Interested party


Volley-ball site lease 17,000,00 Rubles, VAT inclusive (for 2 hours of lease)

Becomes valid from the date of signature by an authorized rep-resentative of the par-ties and is valid until expiration of the period when the Lease Holder undertakes to grant the Facility. The agree-ment is extended on relationship of par-ties incurred from Oc-tober 23, 2008.






Becomes valid from the moment of signa-ture until December 31, 2008. The agree-ment is extended on relationship of par-ties incurred from 09.04.2008.






Becomes valid from the moment of signa-ture until December 31, 2008. The agree-ment is extended on relationship of par-ties incurred from 27.06.2008.



Agreement JSC TransCredit-Basnk

Support to securities trade on the secondary market

50,000.00 Rubles a month

The agreement be-comes valid from the moment of its sig-nature and is valid until full satisfac-tion of all obligations on the Agreement. The agreement is extended on relationship of par-ties incurred before it became valid, from 20.06.2008.


JSC Russian Railways, Novo-zhilov Yu.V., JSC TransContainer board member


Type of transaction



Interested party


Maintenance of an automated system of surplus fees for freight accrued at station ac-counting, software up-grade


The agreement be-comes valid from the moment of its sig-nature and is valid until full satisfac-tion of all obligations on the Agreement. The agreement is extended on relationship of par-ties incurred before it became valid, from July 1, 2008.



Agreement JSC Science, Re-search, Design and Engineer-ing Institute for Information Sys-tem Develop-ment, Automa-tion and Tele-communications on Railways (JSC NIIAS)

The upgrade of soft-ware for operation-al control over billing for carriage with pay-ments through JSC TransContainer with-out change to func-tionality


The agreement be-comes valid from the moment of its signa-ture and is valid until full satisfaction of all obligations on the Agreement



Agreement JSC RZD LLC BaltContainer

Agreement on assign-ment of choices in ac-tion under agreement dated 26.10.2005 № 308






Real estate rent (Slo-bodskoye settlement)

15,345.00 Rubles for 11 months, VAT ex-clusive

The agreement be-comes valid from the moment of its signa-ture and is valid for 11 months from the date of signature. The agreement is extended on relationship of par-ties incurred before it became valid, from January 15, 2008.




Type of transaction



Interested party


Sale of containers ex-cluded from inven-toried stock of JSC TransContainer

11,598 Rubles, VAT in-cluded





Purchase of packages to Ruzhino

20,000 Rubles, not li-able to VAT





Tests of insulating gloves


Becomes valid from the moment of signa-ture until December 31, 2008. The agree-ment is extended on relationship of par-ties incurred from No-vember 1, 2008.




Tests of power con-verter


Becomes valid from the moment of signa-ture until December 31, 2008. The agree-ment is extended on relationship of par-ties incurred from No-vember 1, 2008.






Becomes valid from the moment of signa-ture until December 31, 2008. The agree-ment is extended on relationship of par-ties incurred from May 20, 2008.




Type of transaction



Interested party


Subscription for The Dalnevostochnaya Ma-gistral newspaper


Becomes valid from the moment of signa-ture until December 31, 2008. The agreement is extended on relation-ship of parties incurred from July 20, 2008.





25,626 Rubles, VAT in-clusive






15,522 Rubles, VAT in-clusive





Full repairs of carry-ing roller girder and an electric power en-gine.

93,645.85 Rubles VAT inclusive





Telegraph services (Tynda)

Under telecommunica-tions operator tariffs

Becomes valid from the signature date by the parties and is in force until De-cember 31, 2008 with a possibility of an ex-tension




Telegraph services (Khabarovsk)






Type of transaction



Interested party


Telegraph services(Vladivostok)






Telegraph services(Komsomolsk)






Sublease of a land plot with an area of 19,143 sq.m.(Izhevsk)

61.91 Rubles a year, VAT inclusive

From the date of sig-nature by the parties for 11 months with a possibility of exten-sion for an indefinite period



JSC TransContainer annual report 2008 97JSC TransContainer annual report 2008


subsidiaries and affiliates

1. Oy ContainerTrans Scandinavia Ltd

Full company name Oy ContainerTrans Scandinavia Ltd

Location P.O.Box 488 (Vilhonkatu 13), 00101 Helsinki

Founders VR Ltd (Finland) JSC TransContainer

Charter capital 150,000 euro Number of shares — 300 Nominal value of 1 share 500 euro

Company share in charter capital 50%

Business description Organization, operation, sales, marketing and development of a full range of logistics solutions connected with container haulage on Russian-Finnish routes and purchase of transport, loading, forwarding, operating, unloading, customs processing, door-to-door delivery, warehousing services and services related to the aforementioned trans-portation.

Sole executive body Vyacheslav Gubarev

Board of directors members P. Baskakov (chairman of the board of directors) P. Chichagov Simos Tapio Antero Seppa..nen Ilkka Aimo Jalmari


2. Trans-Eurasia Logistics GmbH

Full company name Trans-Eurasia Logistics GmbH

Location Leipziger Platz 9, 10117 Berlin, Germany

Founders JSC Russian Railways — 30% STINNES AG — 30% JSC TransContainer — 20% KOMBIVERKEHR DEUTSCHE GESELLSCHAFT FUR KOMBINIERTEN GUTERVERKEHR MBH & CO. KOMMANDIT-GESELLSCHAFT — 10% POLZUG INTERMODAL GMBH — 10%

Charter capital 100,000 euro

Company share in charter capital 20%

Business description Organization, operation, sales, marketing and development of a full range of logistics solutions connected with container haulage on Russian-Finnish routes and purchase of transport, loading, forwarding, operating, unloading, customs processing, door-to-door delivery, warehousing services and services related to the aforementioned trans-portation.

Sole executive body There are two managing directors in the Company:Hartmut Albers (managing director on the German side) B. Borisov (managing director on the Russian side)

Board of directors members B.Lapidus P.Baskakov Mr. Hans-Georg Werner (Chairman of the Shareholders’ Committee)Mr. RiedlMr. Schulze — Freyberg


С

Car and container turnover

The average time spent by a container and

/or car from loading to another loading.

Combination through rate

A single inclusive price for the door-

to-door transportation and delivery

of a container. The price is set for one

container and is fixed for a certain pe-

riod upon agreement with a client if the

client undertakes to provide a certain

minimum volume of traffic.

Carrier

A legal entity or individual entrepre-

neur that has assumed the obligation,

under a contract, of carriage by gener-

al-use rail transport, to deliver a pas-

senger, cargo or luggage from the point

of departure to the point of destination,

and to hand over the cargo or luggage

to a party authorized to receive it (the re-

cipient).

Consignee

An individual or legal entity that is autho-

rised to receive the freight or cargo.

Consignor

An individual or a legal entity that acts

on its own behalf or on behalf of the

owner of freight or luggage under a con-

tract of carriage, and that is indicated

in the shipping document.

Container

Transport equipment for the carriage

of cargo, using different modes of trans-

port, which is durable enough for re-

peated use and can be stacked. Contain-

ers are divided into medium-duty (3- and

5-ton) and ISO (20- and 40-foot) contain-

ers. In order to measure the quantitative

as aspect of transport flows, the universal

standard unit TEU (twenty-foot equiva-

lent unit) was introduced. It is equiva-

lent to twenty foot, i.e. to the dimensions

of an ISO 20-foot-long (6.1-metre-long)

container. Thus one standard 40-foot ISO-

series container is equal to 2 TEU, a me-

dium-tonnage 3-ton container — to 1/6

TEU, and a 5-ton container — to 1/3 TEU.

Containerisable cargo

Cargo fit for transportation by contain-

ers, or cargo for which containers are

the best or the only possible means

of transportation.

Container terminal

A place equipped for the trans-ship-

ment and storage of containers. At JSC

Russian Railways, a terminal is more

frequently referred to as a container

area.

Container train

A train consisting of wagons loaded with

containers belonging to the carrier or

to third parties, of a length and speed

of circulation prescribed by normative

legal acts, which is made up at one sta-

tion of dispatch and is bound for one

station of destination without being di-

vided en route, and without any further

re-consignment of the containers.

Container-turnaround

The number of containers handled upon

arrival and departure at a port or station

over a specific period of time.

Crossover bend

A necessary element of a container con-

struction — a standard mechanism

of tightening between transportation ve-

hicles or between themselves. Cross-

over bends are usually located in lower

Glossary


and upper corners of a container. Twist

locks or other equipment which allows it

to raise, stack or fix the container.

D

Dangerous cargo

A cargo which can cause damage

to property, human health and life if han-

dled improperly. The shipment of such

cargo is undertaken in accordance with

special terms of transportation.

Delivery period

A period of time within which a carrier

must deliver goods to a consignee, and

for which it is responsible to the cargo

owners. It includes the time necessary

to transport the goods from the depar-

ture point to the place of destination

(including its loading and unloading),

to perform different associated opera-

tions and document execution. a delay

in goods delivery against a set period

incurs a fine payable by a carrier

to a cargo owner, usually set as a per-

centage of a carriage duty. a carrier is

free from the fine for a delay in goods

delivery in emergency and force

majeure situations.

Door-to-door

Integrated logistics service for deliver-

ing freight directly from the warehouse

of the consignor (the supplier of the

goods) to the warehouse of the consign-

ee (the recipient of the goods). As a rule,

it includes not only transport by rail and

delivery by road but also the handling

of freight at a terminal and (if necessary)

the customs clearance thereof and pay-

ment pursuant to INCOTERMS-2000. It

appeared in response to freight-owners’

desire for their orders to be handled by

a single body.

E

Empty run

The transportation of a wagon in an

empty state, or of an empty container

on that wagon, along a set route.

F

Feeder service

Freight by sea on a short distance be-

tween two or more ports to group or dis-

tribute cargo (usually containers) in one

of the ports for shipment in the open sea

or after such shipment.

Feeder ship

A small ship capable of running in rela-

tively shallow waters. The ships are su-

per-charged with containers that arrive

on lead ships and each collects contain-

ers on its own route.

Freight shipment

Freight shipped under one delivery con-

tract. There are the following kinds of rail

shipment: by car, part load, container,

piggyback, route and group consignment.

Freight

One form of payment for sea transporta-

tion of cargo, or the usage of a ship for

a certain period of time. Freight payment

and its size is set by the volume of cargo

delivered to the point of destination or by

the volume of cargo taken on board.

Forwarder

A party, which undertakes or organizes

transportation and forwarding services

under a forwarding contract, i.e. organiz-

ing the service of cargo transportation,

signing cargo transportation contracts,

cargo admitting and delivering, etc.

I

Intermodal haulage

The carriage of cargo in the same unit

of freight by several modes of transport,

where one of the carriers undertakes

to organize the entire carriage of cargo

from door-to-door. This type of freight

includes delivery of freight to the con-

signee’s warehouse, which can only be

effected by road transport.


International Commercial Terms

International commercial terms are

international rules acknowledged by

government bodies, companies and

businessmen throughout the world as

an interpretation of terms most fre-

quently used in international trade.

International commercial terms, as

a rule, cover sole rights and obliga-

tions of parties under an international

purchase and sale agreement relating

to goods delivery. Each term is a three-

letter abbreviation.

Isothermal container

(thermos container)

A specialized container with insulated

walls that makes it possible to maintain

a constant temperature inside the con-

tainer when transporting mainly food

products.

L

Labeling

Signs, images and other identification

marks which containers are labelled

with. It help establish connection

between a cargo and carriage docu-

ments, to distinguish one shipment

of freight from another, sets the order

of container accounting and informs

on measures of safety when trans-

porting.

Lead ship

A ship that hauls between certain ports.

Such ships can hold containers destined

for a variety of ports.

Logistics

The process of organising a chain of deliv-

ery and managing that chain in the broad-

est sense. This chain might encompass

both deliveries of raw materials that are

needed for production and the manage-

ment of material resources at an enter-

prise, delivery to warehouses and distri-

bution centres, sorting, handling, and final

distribution at the points of consumption.

In the context of transportation services,

it is the existence of a transportation ser-

vice in the chain of delivery of the freight

(goods) that should be borne in mind.

Logistics centre

A territorial association of independent

companies and organizations engaged

in freight (transport agents, consignors,

operators and customs bodies) that pro-

vides clients with related services (such

as the operational storage, maintenance

and repair of containers) and has at least

one terminal. The principal purpose

of logistics centres in transport logistics

in container freight is to even out con-

tainer flows at junctions of two or more

modes of transport, by making up full

container loads for the same purpose.

M

Memorandum bill

A bill which documents the admission

and issue of goods as well as the freight

haulage. It regulates relationships be-

tween consignor, carrier and consignee.

N

Netting (infrastructure service)

Routing of empty cars or containers

from unloading to new loading.

O

Operator

A legal entity or individual entrepreneur

owning wagons and containers, or pos-

sessing them on any other basis, that

participates, pursuant to a contract with

a carrier, in the carriage process using

the aforementioned cars and containers.

P

Piggyback haulage

Combined carriage by rail and road.

In the AIRT system, piggyback carriage

is understood to refer to carriage by rail

of complete, loaded trailer trains, semi-

trailers and detachable motor vehicle

bodies.


R

Railway junction

This is usually the name for large points

which take cargo and passenger trains,

which make up cars into trains and split

them. a railway junction is a complex

of technologically-linked marshalling

yards, freight and passenger stations

which have main and crossover roads,

by-pass routes and feeder lines with

passenger depots, engine houses and

developed electricity business. a railway

junction differs from a usual railway sta-

tion, which performs work obligatory for

all stations, admission and departure

of passengers. a railway junction passes

transit trains from one path to another,

hands cars from one station to another

station which make part of the junction

and paths which make gather in it (a

junction usually has no less than three

paths).

Railway station

A stopping point for trains. Railway sta-

tions are called operation points be-

cause they divide the track into sec-

tions, or station-to-station blocks. Ma-

jor modern stations include different

equipment and construction for normal

functioning of locomotives and cars —

engine houses, repair houses, car-

washing equipment, servicing points.

Marshalling yards and loading stations,

equipped with loading and contain-

er sites, with weight-handling equip-

ment and warehouses, also participate

in freight haulage.

S

Schedule

A schedule is the basis of a smooth

train performance, unites operations

of all railway departments on which

freight and passenger deliveries de-

pend. Schedules are used in all coun-

tries of the world in which freight trains

operate and are created with the help

of computers, which are used to control

schedule fulfillment.

Stacking

Putting containers one upon another

then hauling or holding.

Stevedore

A company or an individual which loads

and unloads ships. It is hired by a ship

owner or a freighter.

T

3PL (Third Party Logistics)

The term is used to define logistics ser-

vices purchase. a company, which pro-

vides 3PL-format services (or a 3PL

provider) takes over from the client

(takes upon himself) the whole complex

of logistics and transportation opera-

tions, including interaction with provid-

ers and sales, allowing its client to sig-

nificantly cut, or even abandon logistics

units of its own, by outsourcing their

functions to a 3PL-provider.

TEU (twenty-foot equivalent unit)

A unit of quantitative measure of trans-

portation flows. It corresponds to the

size of a 20-foot (6.1 m) ISO container.

A standard 40-foot ISO container equals

2 TEU.

Transit

Freight passing from one country to an-

other through the territory of a third

country. The issue of transit admission

and its terms is subject to trade agree-

ments and treaties between countries.

There is direct transit, when freight

of foreign goods is carried under tariff

protection, without placing at a customs

warehouse, and indirect transit, when

goods come to customs warehouses and

then are transported abroad.


Corporate Details

Full Company name:

Joint Stock Company


“TransContainer“

Abbreviated Company name:

JSC TransContainer

Location:

12 Novoryazanskaya St, Moscow,

107228, Russian Federation

Post address:

6/2 Kalanchyovskaya St, Moscow

107174, Russian Federation

Telephone: +7 (495) 262 85 06

Fax: +7 (495) 262 75 78

Web-page address: www.trcont.ru

E-mail address: [email protected]

State registration data:

Date of state registration March 4, 2006

Primary state registration number (ОGRN) 1067746341024

State Registration licence issuer Moscow Interdistrict Inspectorate # 46 of the Federal tax service

Taxpayer identification number (INN) 7708591995

Account details:

INN 7708591995

KPP 997650001

R/s 40702810900000007269

K/s 30101810600000000562

BIK 044525562

Company Auditor:

Full company name: Closed joint stock company

BDO Unicon

Abbreviated company name: CJSC BDO Unicon

Location: section 11, Str 1, Dom 125, Var-

shavskoye Shosse, Moscow, 117587

Telephone: (495) 797 56 65

Auditor’s licence data:

Licence number: № Е 000547, issue date: 06.25.2002

Validity: until 25.06.2012

Licence issuer: Ministry of Finance of the

Russian Federation

Company Registrar

Full company name: Joint Stock Company

“Central Moscow Depositary”

Abbreviated company name: JSC TsMD

Location: Corp. B, Dom 3, Orlikov Per, Moscow,

107078

Tel.: +7 (495) 221-13-35

Fax: +7 (495) 221-18-65


Licence: №10-000-1-00255, issue date: Sept. 13,

2002

Licence issuer: the Federal Financial Markets

Service

Validity: for an indefinite term

Body to issue the licence: the Federal Securities

Market Comission

Date which starts maintenance of register by

the registrar: June 28, 2007

Press centre:

Tel/fax: +7 (495) 262 06 65


© JSC TransContainerDesign by YellowDog Studio

Documents

Transcontaioner 08 annual report