Business news from Ukraine


National energy company Ukrenergo on May 18, 2018 is to discuss the plan for developing the power transmission system for 2019-2028 in public, the company’s press service has reported. The draft plan has been posted on the website of Ukrenergo. The document contains a list of security measures for supplies of electricity, the list of facilities of the transmission system which should be built and reconstructed in coming 10 years, data on the projects to modernize the power transmission system being implemented or approved for the implementation.
Ukrenergo operates trunk and interstate power grids, as well as performs the centralized dispatching of the united energy system in the country. The company is a state-owned enterprise, it is subordinate to the Ministry of Energy and Coal Industry, but by the end of 2018 the company is to be reorganized into a private joint-stock company.

, ,


The International Finance Corporation (IFC) could provide a long-term corporate loan of $17 million to the largest tomato paste and industrial tomato producer in Ukraine, the Agrofusion Group. According to a posting on the website of IFC, the funds are provided to finance the company’s 2018-2019 expansion and debt refinancing program.
The total cost of the project is $30 million. The project is pending approval.
IFC said that this will be the third project with Agrofusion. Agrofusion Group, founded in 2007, belongs to businessman Serhiy Sypko. Agrofusion includes three tomato paste production plants with the processing capacity of about 7500,000 tonnes of tomatoes per season, as well as farms in Kherson and Mykolaiv regions, processing 25,000 hectares of irrigated land, and two greenhouse farms.



Milkiland, a dairy group with assets in Ukraine, Russia and Poland, saw EUR 7.35 million of net loss in 2017, which is 81.1% less than in 2016. According to a company report on the website of the Warsaw Stock Exchange (WSE), revenue last year fell by 4.35, to EUR 140.41 million. Gross profit grew by 12.2%, to EUR 23.69 million. Operating profit stood at EUR 0.59 million compared with EUR 5.5 million of operating loss in 2016.
Earnings before interest, taxes, depreciation and amortization (EBITDA) grew 1.9-fold, to EUR 10.28 million, net debt reached EUR 85.14 million at the end of 2017 compared with EUR 101.24 million in 2016. The net debt/EBITDA ratio fell from 18.6 to 8.28. Total assets decreased by 4.8%, to EUR 160.42 million.
Russia is the largest market for Milkiland contributing about 62% to the group’s total consolidated revenue in 2017. Sales in Ukraine account for about 27% of the group’s revenue and include all range of dairy products. Poland secured 8% of the group’s total revenue in 2017, while other countries account for 3%.
At the same time, revenue in the segment of whole milk products declined by 10.2% year-on-year to EUR 73.25 million compared to 2016 (52%); cheese and butter – by 9.5%, to EUR 42.25 million (30%); in the segment of dried milk and other products, revenue increased by 34.5%, to EUR 24.92 million (18%).
Milkiland in 2017 began shipping to several new markets, in particular to Israel, China, Denmark and the Netherlands. In 2017, the group invested EUR 2.8 million to support assets in Ukraine, Russia and Poland. In 2018, Milkiland intends to invest up to EUR2 million in servicing its assets and introducing new products in key group markets. “Despite some positive steps to better results and margins, in 2017 the group did not achieve a task of restoring the profitability of its business. The current year is expected to be crucial for reaching a break-even point for generation of the new value of the business. The Group’s management is going to achieve this by continuing a policy aimed at strengthening of the market positions of Milkiland in the countries of its operations, as well as on searching for new, and advancing at the existed export markets,” the company said.

, ,


KSG Agro agroholding saw $0.895 million of net profit in 2017, which is almost 77.4% less than in 2016. According to an unaudited report of the company posted on the website of the Warsaw Stock Exchange (WSE), revenue last year grew by 10.8%, to $23.19 million. Gross profit fell by 10.6%, to $11.64 million, and operating profit – by 29.6%, to $11.24 million.
Earnings before interest, taxes, depreciation and amortization (EBITDA) fell by 26.4%, to $12.73 million.
In 2017, the company increased sales of pigs and young pigs by 5.6%, to 9,810 tonnes (in monetary terms by 38.8% – to $11.8 million). Last year, the holding collected a crop harvest which was 1.6% less than in 2015 – 50,600 tonnes. In particular, 18,400 tonnes of sunflower, 19,700 tonnes of wheat, 5,200 tonnes of barley, 1,700 tonnes of corn, and 800 tonnes of rapeseed were harvested.
In the structure of KSG Agro’s revenue for the last year, the share of the grain segment decreased to 36% from 37% in 2016, the pig-breeding segment grew to 33% from 26%, processing – to 22% from 20%. Net debt of the company as of December 31, 2017 was $47.8 million.
KSG Agro restructured $3.88 million of liabilities for 30 years. This loan was previously taken in Credit Agricole Bank. In January 2018, the bank conceded it along with property rights as a pledge to a third party that restructured the loan.
The company is negotiating with international creditors related to the restructuring of the total debt of $18 million. The agroholding in 2017 signed letters of intent, which agreed on the preliminary conditions for debt restructuring. In accordance with them, KSG Agro is obliged to repay the debt in ten years starting from 2018. In December 2017, the group made a final decision on the choice of a legal adviser and began the process of preparing the agreement.

, , , ,