Analysis of Wagon LOSTR’s Annual Report: Millions in Overdue Liabilities, Material Sell-Offs, and Auditor’s Warning

Wagon LOSTR is widely regarded as an established manufacturer of railway vehicles in the Czech Republic, with its name long associated with the industrial identity of Louny and the broader rail maintenance and modernisation sector. That is why its financial results—and the questions they raise—have attracted editorial interest.

The economic health of key and smaller players in the railway sector affects not only employees and owners, but also the entire supply chain, customers, and ultimately the safety and reliability of railway operations. The 2022 annual report of Wagon LOSTR, accompanied by an auditor’s warning and a lack of recent updates, goes beyond accounting—it acts as a warning signal that cannot be overlooked.

A Financial Balance Sheet Full of Questions

RAILTARGET has analysed the company’s 2022 Annual Report, compiled through March 2023. The stated balance raises numerous concerns. Since the company has yet to publish its 2023 report—despite legal obligation—its current financial state may already have changed significantly. But it is the auditors themselves who highlight serious concerns in the existing report. What lies behind the declared profit of EUR 3,770 (CZK 93,000)?

Although new owners Peter and Rudolf Šuška promised to stabilise the historically significant company—both financially and in terms of personnel—they clearly struggled to deliver in the first few years. As previously reported, staff numbers fell by approx. 19% between 2021 and 2023. From the original 280 employees, only 229 or fewer remained. Trade unions even raised alarms in May regarding further layoffs, including of qualified personnel.

The report also reveals a more troubling issue: the company cannot meet its commercial obligations on time. Wagon LOSTR has over EUR 2,4 million (CZK 59 million) in overdue liabilities, raising the question of whether the loss of skilled workers is behind order delays—suggesting a downward spiral. A table screenshot shows that the longer the delay, the higher the price. One contract worth over EUR 1 million (CZK 25 million) is overdue by 1 to 2 years.

Owed to Themselves? Questionable Internal Accounting

One might argue that the company is owed money by other entities. While true, closer scrutiny reveals a murkier picture. Of the company’s EUR 7,2 million (CZK 176.4 million) in assets, EUR 4,9 million (CZK 100.9 million) is a receivable from another company in the Šuška brothers’ portfolio—Traťová a strojní společnost a.s. However, this company itself shows significant financial distress, casting doubt on whether the debt can realistically be recovered.

Moreover, 97.6% of Wagon LOSTR’s equity is comprised of an item labelled "Differences from the transformation of business corporations," apparently linked to the transfer of assets from Traťová a strojní společnost a.s.

Equity is supposed to represent the real net worth of a business—the sum of its assets minus liabilities. But if the declared assets originate from a problematic entity, the entire equity value becomes questionable.

Sales, Accounting Tricks, and the Auditor’s Red Flag

It’s common practice for companies to "boost" their figures by selling off assets such as real estate. But such sales can skew the overall balance sheet. In the case of the Louny-based manufacturer, material sales of over EUR 1,5 million (CZK 36 million) took place during 2022 and Q1 2023. Notably, this occurred during the COVID-era surge in prices for industrial materials due to disrupted global supply chains. Was this a strategic sale or a desperate move? The declared profit of EUR 3,770 (CZK 93,000) during this period now seems artificial, especially when compared to such large asset sales.

Independent audit firm Warido audit s.r.o., in the report’s annex, flagged multiple risks, leading to a qualified opinion. The auditor highlighted significant related-party transactions, carried out without a mandatory related-parties report and based on unclear transfer pricing. "The impact of this on the attached financial statements could be material… The company’s heavy reliance on group transactions presents a risk," wrote auditor Prof. Ing. Renáta Hótová.

An auditor’s opinion is a standardised public document used to evaluate the accuracy of a financial report. The possible verdicts are:

• Unqualified opinion
• Qualified opinion
• Adverse opinion
• Disclaimer of opinion

In this case, the qualified opinion means the auditor disagrees with specific parts of the financial report. The audit document explains precisely which issues led to this verdict.

Concerns Remain Amid Lack of Transparency

Despite reporting a symbolic profit in its 2022 financials, a deeper look reveals the result may be more of an accounting construction than a sign of healthy operations. The report highlights large overdue debts, dependency on struggling affiliates, asset sales at a questionable time, and auditor warnings—all pointing to financial instability. Worsening the situation, the company has failed to publish its 2023 report, despite the legal deadline having passed.

Partners, employees, and the public remain in the dark as to whether a company tied to a longstanding Czech industrial tradition is slowly sliding toward insolvency. Only a new set of financial statements can clarify the true state of affairs.

RAILTARGET reached out to the company’s management for comment, but as of publication, no response was received.