...April 30, 2024 VTG performed in line with our expectations for 2023, while improving profitability. Revenue declined by about 7% to 1.2 billion in 2023, which was mainly fueled by VTG's optimization of its core business (winding down its Tanktainer business and Silk road and project logistics). Revenue was also weakened by the intermodal segment, where the market witnessed an oversupply of railcars, lower transportation volumes, and drop in utilization rates. However, VTG's two main segments (bulk and liquid) performed well, underpinned by utilization rates in line with historical averages. Despite various operational headwinds, VTG's profitability improved, with EBITDA margin rising to about 41% in 2023 from 36% in 2022. Strict cost control, lower repairs and maintenance expenses, and lease rate increases ahead of inflation were the main drivers. In our base-case scenario, we predict EBITDA margins will remain at least stable due to VTG's focus on yield management and operational optimization,...
