Company's Strategy

As a key business unit of the parent company, JSC FPC is mainly focused on the achievement of financial and economic volume targets set out in the Parent Company’s Long‑Term Development Programme of Russian Railways until 2025 (LDP) approved by the Russian Government.

In 2019, JSC FPC developed and approved the Development Strategy until 2030 Approved by the resolution of the Board of Directors of JSC FPC (extract from Minutes No. 11 dated 27 December 2019). and set up a framework for its implementation.

The Company also has the Regulations on the System of Key Performance Indicators of JSC FPCApproved by the resolution of the Board of Directors of JSC FPC (extract from Minutes No. 9 dated 26 December 2024). in place to motivate the management to achieve company strategic goals through a system of target key performance indicators (KPIs).

Mission

Vision

• National carrier providing traditional and higher‑speed long‑distance rail passenger services both in Russia and abroad
• Leader by passenger traffic in long‑distance transport in Russia
• Leader in long‑distance ticket aggregation services, offering entire tickets connecting rail passenger services across domestic regions

• Leader in service quality in long‑distance land transport, providing high‑quality value proposition and comfortable long‑distance travel experience, including transit connections with other modes of transport and multi‑modal transport services

• Sustainable development of mobility across customer segments and regions of Russia

• Maximisation of the financial result and self‑sustainability of operations

Strategic goals of the Company

According to the Strategy, the Company’s main focus is on boosting the average journey speed, developing comprehensive combined transport operations (such as multi‑modal transport services), increasing passenger traffic on the key routes in Russia, and improving the competitiveness of our existing services. JSC FPC also continues to act as a public carrier, which means servicing single‑mode or socially important routes.

The Strategy’s key targets address changes in the transport market, the competitive situation, evolving customer requirements, and development trends in the passenger transport regulatory environment.

Strategy outcomes in 2024

In 2024, the Company kept up its efforts to maintain and enhance transport accessibility amid airport closures in southern Russia, as well as to increase passenger traffic, stimulate demand for passenger transportation, and optimise costs. JSC FPC carried around 112.7 million passengers in 2024.

To ensure the guaranteed quality of transportation, the Company continued to improve its services, develop new routes and renew its rolling stock.

The tourist train network is being constantly expanded to provide our citizens with a comfortable and secure tourism environment. The trains are made up of modern comfortable carriages.

Strategic areas of development

Network

The following trains are put online to expand the scheduled service of the double‑decker trains in 2024:

• No. 741/742, 743/744 St. Petersburg – Moscow ‘Aurora’
• No. 391/392 Chelyabinsk – Moscow
• No. 63/64 Samara – St. Petersburg

Rolling stock

In 2024, carriages were purchased under the long‑term agreement with suppliers until 2025. According to the agreement, four batches of rolling stock are to be supplied:

• Carriages of existing model range
• Single‑decker carriages of late model
• Double‑decker carriages of late model
• Innovative single‑deckers and double‑deckers

The procured rolling stock includes carriages with better design and feature:

• Private space for personal relaxation
• Spacious interior with room to walk around
• Low‑floor and barrier‑free boarding
• Dedicated baggage areas
• Advanced technology intensiveness

Product offering

The Company is planning a transition to a new unified, high‑quality product offering. At the heart of the strategic initiative is a focus on customer needs. The Company crafts an intuitive value proposition for passengers, based around the unification of technical equipment of carriages and standardisation of value‑added services. As of the end of 2024, the transition to the new product line has not yet been completed.

Multi‑modality

In 2024, the Company offered multi‑modal service for seven routes: Kostroma – Yaroslavl, Boksity – Serov, Belgorod – Rossosh, Vologda – Yaroslavl, Arzamas – Diveevo, Ussuriysk – Andreevka and Tikhookeanskaya – Livadia.

Other business lines and adjacent businesses

To improve market stability, JSC FPC seeks to diversify its operations and develop businesses that increase the profitability of railway service, including:

• On‑train passenger services
• Development of rail tourism
• Services involving all modes of transport
• Logistics services (cargo, mail, etc.)

Developments in this area in 2024:

• Poputchik infotainment system is now available on 115 trains of JSC FPC
• A new service, Waiting List, is introduced to submit a booking request in case of no seats available for a train on a given route but may become available later if a carriage is added to the train or someone returns a ticket
• The map of tourist routes was expanded, with total 39 routes in the reporting year In 2024, 28 tourist trains, including regional projects, were offered to passengers. Over 114,000 people used the service last year

Key performance indicators

The KPI system is used to evaluate JSC FPC's performance and contribution to the implementation of the parent company's strategic goals. The Regulations on the System of Key Performance Indicators of FPC JSCApproved by the resolution of the Board of Directors of JSC FPC (extract from Minutes No. 9 dated 26 December 2024). establish the set of KPIs and the process for determining the extent to which they are met.

JSC FPC’s corporate KPIs reflect the performance in the reporting year and are based on the strategic goals and objectives set for the Company.

The list of annual corporate KPIs for 2024 includes:

• Passenger satisfaction index (long‑distance trains)
• Traffic safety level
• Passenger departures
• Revenue from regular activities
• EBITDA margin
• Net debt/EBITDA

Targets were set for each indicator. As of year‑end 2024, all of JSC FPC's corporate KPIs met their targets.

Key objectives of JSC FPC for 2025

• To consolidate the Company’s position in the passenger service market through route network expansion, new level of customer service, rolling stock replacement, and operational infrastructure upgrade and modernisation
• To implement the initiatives outlined in JSC FPC’s Development Strategy until 2030, including:
  • Geographic growth of double‑decker train service
  • Launch of new trains
  • Competitive growth of the existing product line
  • Renewal of rolling stock
• To ensure guaranteed quality of railway service
• To develop and implement integrated marketing projects for new passenger service offerings
• To bring the long‑distance passenger satisfaction index to at least 88.1 points
• To improve the level of traffic safety
• To minimise the adverse environmental impact
• To develop human capital
• To build digital capabilities and actively deploy digital technologies in order to enhance the efficiency of internal processes and improve services
• To ensure transport mobility of the population due to increased passenger traffic to southern destinations