- reduction in the volume of freight provided for transportation;
- risk of unplanned fluctuations in transportation volumes exceeding the carrying capacity of certain railway sections;
- deterioration in the structure of industrial and agricultural production;
- growth in prices for goods and services consumed by the Russian Railways Group as a result of inflation;
- decrease in the Company’s income from passenger transportation due to a decline in the public’s ability to pay;
- decline in investment and business activity.
- decrease in the Russian Railways Group’s share of highly profitable segments of the transportation market;
- growth in intra-industry and cross-industry competition;
- advanced development of alternative types of transportation, including through the accelerated introduction of innovations;
- establishment and full-scale operation of international corridors to bypass Russia;
- risk of the quality and range of services not complying with new customer requirements;
- lack of production capacity among product suppliers for the Russian Railways Group.
- credit risks;
- currency risks;
- interest risks;
- price risks as regards raw commodity and energy assets;
- risk of liquidity loss;
- downgrading of Russian Railways positions by international ratings agencies;
- financial implications from property and liability risks.
|Human resource risks
- increased imbalances in the structure of the workforce represented on the market;
- deterioration in the positions of Russian Railways on the labour market;
- deterioration in the quality of the workforce;
- reduction in the working population in remote regions due to the urbanisation of society;
- risk of the diminished attractiveness of professions in the railway transportation industry.
- continued strict government tariff regulation;
- stricter environmental requirements;
- stricter legislation (transportation, tax, etc.);
- failure to fulfil the action plan to give the constituent entities of the Russian Federation greater responsibility to compensate for falling income by suburban passenger companies.
- impact of international sanctions against the country’s economy and activities of Russian Railways;
- deterioration in intergovernmental relations;
- local military operations.
|Manmade, natural and climatic
- accidents at facilities that support the work of the Russian Railways Group;
- manmade accidents on related types of transportation (primarily in seaport waters and on major highways);
- fires or natural disasters in areas where the Russian Railways Group operates.
|Scientific, technical and technological
- use of new energy resources and energy-saving modes on alternative types of transportation;
- improving the carrying capacity of vehicles and vessels.
|Production and technological
- lag in infrastructure development compared with the increase in freight and passenger transportation;
- disruptions in the organisation of freight delivery logistics schemes;
- disruptions to the plan for making up trains and the train traffic schedule;
- violations of traffic safety;
- diminished efficiency from the use of rolling stock;
- discrepancies in existing technological processes for organising transportation with the quality requirements for transportation products.
|Technical and resource
- continued high level of fixed asset deterioration;
- breach of the deadlines and conditions for supplies of material resources;
- risk of using substandard and incomplete information about consumers of the Russian Railways Group’s services.
- incorrect substantiation and erroneous selection of new investment targets;
- diminished return on investment and failure to ensure planned profitability from invested funds;
- lack of clear guarantees for transportation volume from freight owners when implementing infrastructure investment projects;
- risk of the failure to meet the parameters of the projects implemented (exceeding the budget, failure to meet deadlines or failure to achieve the project objective).
|Risks of structural reforms
- threat of a disruption to the technological processes of the Russian Railways Group and significant financial losses as a result;
- threat of the loss of financial sustainability and the risk of bankruptcy of S&A;
- decrease in the profitability of the Russian Railways Group due to the uncompensated spin-off of highly profitable S&A;
- decline in asset value and capitalisation of the Russian Railways Group in the event of the ineffective work of S&A.
- lack of compliance of the professional level of personnel with the requirements of the Russian Railways Group;
- risk of a further increase in the number of employees approaching retirement age;
- outflow of highly skilled personnel due to insufficient motivation and the decreased competitiveness of salaries for employees of the Russian Railways Group compared with other industries;
- violations of labour safety through the fault of personnel;
- risk of ineffective recruiting, placement and management of personnel;
- violations of labour discipline;
- deterioration in the corporate culture of employees.
- reduced manageability of Russian Railways Group structures;
- adoption of unsubstantiated management decisions;
- failure to execute decisions by the required deadlines;
- failure to achieve target economic and production performance results of the Russian Railways Group.