Business news from Ukraine

ACINO PHARMA COMPANY SIGNS AGREEMENT WITH DUTCH PROBIOTIC MANUFACTURER

Switzerland’s Acino pharmaceutical group has signed a license agreement with Dutch Biocare Copenhagen A/S, the manufacturer of probiotics, and would present the Optilakt fifth generation probiotic line in Ukraine.
Acino said in a press release that the probiotic will appear in the Ukrainian pharmacy chain in February 2018. The financial conditions of the deal are not disclosed.
According to the conditions of the license agreement, Acino will be the exclusive representative of three products of this trademark in Ukraine until 2022 inclusively.
Acino Ukraine Director General Yevhen Zaika said that in 2017, Acino entered the pediatrics segment, signing the distribution agreement with France’s Laboratoires Gilbert SAS being authorized to sell and promote some over-the-counter medicines in Ukraine.

GOOGLE LLC (KYIV) SEES 75% RISE IN REVENUE FROM ADVERTISEMENT IN UKRAINE

Google LLC (Kyiv), under control of Google and providing advertising services, increased revenue by 75% in 2017, which is higher than the pace of 2016. The company entered the top 100 largest taxpayers of the country, Google LLC Director General Dmytro Sholomko has said.
“If two years ago the share of small and medium-sized businesses of revenue was 40%, now it exceeds 60%,” he said, explaining one of the main reasons for this growth during traditional discussion of the macroeconomic forecast for the year organized by the European Business Association (EBA).
Sholomko pointed out the rapid growth of the mobile Internet. He said that mobile Internet traffic has already exceeded the computer one, which also contributed to the good results.
In general, the general director of Google said that the technological business of Ukraine continues to grow rapidly, the country strengthens its image in this sector in the world, which is converted into the decision of major global technology companies to place their development centers here. He named PayPal, Samsung and Waze as an example. According to him, these centers are now being opened not only in Kyiv, Lviv and the cities with a million of population, but also in other regional centers.
Among the problems Sholomko pointed out the difficulties with financing this business in Ukraine, which reduces its competitiveness in comparison with neighboring countries, for example, Poland or Lithuania.
Google LLC in 2016 increased revenue by 61.3% – to UAH 1.004 billion, and in January-September 2017 it increased to UAH 1.082 billion. The net loss of the company in 2016 increased 2.7-fold, up to UAH 87.12 million, but in January-September 2017 it saw net profit of UAH 16.31 million.
According to the State Fiscal Service, in January-November 2017, Google has become the 94th largest tax payer in Ukraine, staying between FC Shakhtar (UAH 353.06 million of taxes) and Mariupol maritime merchandise port (UAH 339.85 million). Data on the exact amount of taxes paid by Google for this period are not available in the State Fiscal Service’s information.

FOUR REGIONAL ELECTRICITY SUPPLY COMPANIES PREPARING FOR SWITCH TO RAB

Electricity supply companies Chernihivoblenergo, Lvivoblenergo, Prykarpattiaoblenergo and Sumyoblenergo plan to switch to Regulatory Asset Base (RAB) from April 1, 2018.
According to postings on the website of the companies, they held public discussions required for the switch to RAB on January 29 through February 1.
Prykarpattiaoblenergo plans to increase investment by six times with the switch to RAB.
“With existing investments, the restoration of 0.4-10 kV power lines, which today are subject to reconstruction and replacement, will last 87 years, and with the introduction of incentive tariffs, the power lines that are in unsatisfactory condition will be rebuilt within 16 years,” the company said.
According to the estimates of Prykarpattiaoblenergo, on average, every client of the company remains without power 7 minutes a day. After switching to RAB, by 2025 the company expects to reduce this indicator in towns by 60%, in villages by 75%.
Lvivoblenergo said that over 60% of the company’s power lines require reconstruction and replacement, while annual funding for these activities is about 50% of the required sum.
“Thus, the underfunding of the Lvivoblenergo’s power lines development program in 2012-2017 amounted to about UAH 400 million,” the company said in a statement.
Sumyoblenergo expects to reduce the index of the average duration of breaks in power supply to consumers by 50% for the urban areas and 63% for the rural areas within eight years.
“The annual reduction of operational control costs by 1% is expected from 2019, which will reduce the company’s share in the retail tariff for electric power. In addition, the use of indicators for the efficiency of technological costs of electricity will lead to a gradual decrease,” the company said.

CHINA RAILWAY INTERNATIONAL GROUP READY TO INVEST IN QUICKLY IMPLEMENTED INFRASTRUCTURE PROJECTS IN KYIV

Deputy Head of Kyiv City Administration Dmytro Davtyan has discussed the possible participation of China Railway International Group (CRIG) in the implementation of infrastructure projects in Kyiv with representatives of the company.
The press service of Kyiv City Administration reported that representatives of the Chinese company said that they are ready to invest large funds in the projects that could be implemented in Kyiv in coming years.
“Of course, the most interesting project is construction of subway and bridges, as they could be united and the attraction of investment and work at these sections could be optimized,” the press service said.
Davtyan expressed confidence that this cooperation could and should become a pivot for Kyiv’s authorities.
“Rational and promising cooperation is interesting for us. We look for the new projects being not only important for Kyiv residents, but they also should be smart. The attraction of industry-led companies would allow not only achieving this, but it would also help to enrich the sector from the intellectual and technological point of view. Most technologies used by Chinese companies are high-tech and advanced solutions. This is also a good opportunity to strengthen and expand the intellectual potential of Ukrainian specialists,” he said.

SOLAR PARK PIDHORODNYE LAUNCHES 16 MW SOLAR PLANT IN ZAPORIZHIA REGION

Solar Park Pidhorodnye LLC (Dnipro) has built and commissioned a solar power plant with an installed capacity of 16.012 MW in Vesele (Zaporizhia region), according to the government web portal.
The projected volume of electricity production by the facility is 22.718 million kWh per year.
Solar Park Pidhorodnye previously built two solar plants with a total installed capacity of 1.645 MW in Dnipropetrovsk region.
The company is part of the Ukrainian Solar Systems group (Kyiv), which produces fixing systems for solar panels. The beneficiaries of Solar Park Pidhorodnye are Hanna Bondarenko, Serhiy Bryzhan, and Yuriy Hordeyev.

UKRAINE RAISES GAS PRODUCTION 3.1% YEAR-ON-YEAR IN JAN, 2018

Ukraine raised gas production 3.1% year-on-year in January, to 1.774 billion cubic meters (bcm), pipeline operator Ukrtransgaz has said. According to Interfax-Ukraine’s calculations, gas production by PJSC Ukrgazvydobuvannia rose 3.3%, to 1.303 bcm, while production by Ukrnafta fell 16.7%, to 91 million cubic meters.
Ukraine increased natural gas transit through the gas transportation system (GTS) by 32.1% year-on-year in January, to 6.056 bcm.
Transit of natural gas to European countries across Ukraine totalled 5.689 bcm and to Moldova 366.1 mcm.
Ukraine withdrew 2.178 bcm of natural gas from its underground gas storage facilities in January 2018, 1.5 times more than in December 2017.
Gas stocks in Ukrainian underground storage facilities fell by 26.3% or 4.460 bcm, to 12.515 bcm between October 24, when the heating season started, and January 31 inclusive.
According to Interfax-Ukraine’s calculations, the country withdrew an average daily 24.85 mcm of gas from underground storage in November and 46.05 mcm in December last year, and 70.24 mcm in January this year, including 68.27 mcm on January 31.
On January 31, 2017 Ukraine took 91.94 mcm from its facilities which had 9.885 bcm of gas stored, on January 31, 2016 some 52.67 mcm (11.112 bcm) and on January 31, 2015 some 56.04 mcm (9.311 bcm).
Ukrtransgaz, wholly owned by Naftogaz Ukrainy, operates a system of trunk gas pipelines and 12 underground gas storage facilities in the country.