FESCO: profit nearly vanished, but operating cash flow rose to RUB 25.4bn — the question is what they do with it

25 августа FESCO раскрыла результаты за первое полугодие 2026 года: выручка выросла на 5,0% до 175,9 млрд руб., EBITDA упала на 32,5%, а чистая прибыль сократилась на 94,9% до нуля. Разбор показывает, что операционный денежный поток за последние 12 месяцев достиг 25,4 млрд руб., а долговая нагрузка осталась умеренной — 1,23 EBITDA. Главный вопрос для акционера — куда пойдут эти деньги.

Key takeaways

— Revenue grew 5.0%, but EBITDA fell 32.5% — margin compressed from 22.6% to 14.5%

— Net profit nearly vanished: down 94.9%, margin 0.0% versus 0.8% a year earlier

— Operating cash flow over 12 months — RUB 25.4bn, higher than EBITDA

— Leverage at 1.23 EBITDA, but this is a level, not a trend

— EV/EBITDA of 9.1 — almost double its own three-year average of 4.6

— ROE of 0.05% — equity works at nearly zero return

— Net debt fell RUB 3.4bn over the half-year and RUB 3.1bn over the year

Key figures, RUB bn

Revenue grew 5.0%, but EBITDA fell 32.5% — margin compressed from 22.6% to 14.5%

For H1 2026, FESCO's revenue reached RUB 175.9bn, up 5.0% from the same period a year earlier. Growth is there, but it did not compensate for the decline in operating profitability: EBITDA for the half-year fell 32.5%, and the EBITDA margin contracted from 22.6% to 14.5%.

This means the company earns noticeably less per ruble of revenue than a year ago. The reasons for such compression are not disclosed in the report, but the fact remains: operating efficiency has deteriorated, and this is the main driver of the profit decline.

Net profit nearly vanished: down 94.9%, margin 0.0% versus 0.8% a year earlier

Net profit for H1 2026 fell 94.9% compared to the same period last year, and the net margin was 0.0% versus 0.8% a year earlier. In effect, the company broke even.

Such a decline amid growing revenue suggests that most of the operating profit was consumed either by rising costs or by financial items. The report does not specify the exact cause, but for a shareholder this is a signal: there is almost nothing to earn per share.

Operating cash flow over 12 months — RUB 25.4bn, higher than EBITDA

Over the trailing twelve months, FESCO's operating cash flow amounted to RUB 25.4bn — higher than EBITDA for the same period (RUB 22.6bn). This ratio suggests that the company generates sufficient cash from core operations despite the profit decline.

This is an important contrast to the reported half-year: operating cash flow over 12 months exceeds EBITDA, which usually indicates high-quality revenue and efficient working capital management. The question is how these funds are allocated — to investments, dividends, or debt repayment.

Leverage at 1.23 EBITDA, but this is a level, not a trend

As of the latest balance sheet date, FESCO's net debt stood at RUB 27.7bn, and the net debt to EBITDA ratio over the trailing twelve months was 1.23. This is a moderate level that does not threaten financial stability.

At the same time, net debt decreased by RUB 3.4bn over the half-year and by RUB 3.1bn over the year. That is, the company is reducing debt, but we do not know how the ratio changed — that would require data from previous periods, which is not in the facts.

EV/EBITDA of 9.1 — almost double its own three-year average of 4.6

The current EV/EBITDA multiple is 9.1, while the three-year average is 4.6. This means the market values the company twice as high as its average over the past three years, relative to its operating profit.

Such a premium may be justified by expectations of margin recovery, but the report so far shows the opposite: EBITDA is falling, and the valuation remains high. If profitability does not recover, the multiple will weigh on the share price.

ROE of 0.05% — equity works at nearly zero return

Return on equity over the trailing twelve months was 0.05%. This means that for every ruble of equity, the company earns less than a kopeck — effectively, equity generates no income.

Such a level of ROE, with zero net profit for the half-year, raises the question of whether it makes sense to retain earnings in the company. For a shareholder, this means that investments in FESCO are currently barely paying off.

Net debt fell RUB 3.4bn over the half-year and RUB 3.1bn over the year

The reduction of net debt by RUB 3.4bn in H1 2026 and by RUB 3.1bn over the trailing twelve months is a positive signal. The company is using part of its operating cash flow to reduce debt.

However, at this level of profit, further debt reduction may slow down. If EBITDA continues to fall, the debt/EBITDA ratio could rise even if absolute debt declines.

Valuation on the latest reported figures

Bottom line

The strength of the report remains operating cash flow: RUB 25.4bn over 12 months — higher than EBITDA and sufficient to service debt. The weakness is profit: a 94.9% decline and ROE of 0.05% mean the business earns almost nothing for shareholders. The debt reduction can be seen as a one-off factor, but it does not compensate for the loss of margin. The key question for a holder is whether the company can restore EBITDA to levels that justify the current valuation, or whether the market will have to revise the multiple downward.