20 May 2010 17:51

RZD reaches provisional agreement on 8 bln rubles in additional subsidies

MOSCOW. May 20 (Interfax) - Russian Railways (RZD) has reached preliminary agreement on an additional 8 billion rubles in subsidies to provide discounted travel.

"The 2010 federal budget currently has 27.8 billion rubles planned for us. We have apparently managed to secure another 8 billion rubles for social travel programs, although officially that sum is not included yet," the deputy general director of RZD's Federal Passenger Company, Vadim Mishanin, said at a press conference in Moscow on Thursday.

The company could post a net profit of about 1 billion rubles in 2010. "If they pay us the 36 billion rubles we requested to provide that travel, we hope to post a profit of up to 1 billion rubles, given that all the subsidies are received and the new fare schedule (10.0216) is introduced in the shortest possible time," he said.

Mishanin said First Passenger would post revenue of 158 billion rubles in 2010 from all business segments, including 55 billion rubles from passenger travel. "The rest is from baggage carriage, freight baggage and international service," he said.

"We are prepared to cut spending by 7 billion rubles relative to the business plan," he said. Mishanin had previously estimated 2010 revenue at "from 165 billion rubles a year."