Business news from Ukraine

SRI LANKA AND UKRAINE TO CREATE COMMISSION ON TRADE

Ukraine and Sri Lanka will sign an agreement on the establishment of a joint intergovernmental commission on trade and economic cooperation. The corresponding decision was made at a meeting of the Cabinet of Ministers of Ukraine in Kyiv on May 10. The draft agreement establishes the procedure for the establishment and functioning of such a commission, its authorities, the frequency of meetings and the legal status of the decisions it takes.
As reported, in late March, Ukrainian President Petro Poroshenko approved the composition of the delegation to participate in the negotiations with Sri Lanka on the harmonization of the draft interstate agreement on the promotion and mutual protection of investments.

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LARGEST SUGAR PRODUCER ASTARTA HAS 86% FALL IN PROFIT IN 2018 – WARSAW STOCK EXCHANGE

Astarta agroindustrial holding, the largest sugar producer in Ukraine, in January-March 2018 saw an 86% fall in net profit year-over-year, to UAH 124.3 million, the company has said on the website of the Warsaw Stock Exchange (WSE). According to the press release, revenue over the period fell by 28.7%, to UAH 3.04 billion, gross profit – 58.3%, to UAH 623.032 million and operating profit – 86%, to UAH 141.36 million.
There are several reasons for this: markets cyclicality, macroeconomic factors, as well as a high comparison base. “Our view is that results should be regarded in a long-term context, so as not to distract from the bigger picture,” the company said.
In euros net profit fell by 88%, to EUR 3.7 million and revenue fell by 38.8%, to EUR 90.59 million.
Earnings before interest, taxes, depreciation and amortization (EBITDA) fell by 70%, to EUR 13.47 million as a result of significant contraction of the global and local sugar prices as well as bad weather conditions in the Poltava region contributed to a higher cost in sugar and farming.
At the same time, when one takes a longer-term view, there are several reassuring thoughts. The group is currently moving through the bottom part of the commodities cycle with low debt, a strong balance sheet, constantly increasing operational efficiency, and a healthy combination of local sales and export.
“There were several similar periods in Astarta’s 25-year history, when the challenges made our company stronger and provided for new growth opportunities,” the company said. With strong support from our financial partners – development and international banks, the company continue its investment program to expand storage infrastructure, further streamline farming operations, and become closer to our end-customers.

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UKRAINE APPROVES 26 LARGEST ENTERPRISES FOR PRIVATIZATION INCLUDING CENTRENERGO, ODESA PORT-SIDE PLANT, TURBOATOM, ZAPORIZHIA TITANIUM COMBINE, UNITED MINING-CHEMICAL COMPANY, SUMYKHIMPROM

The Ukrainian government has approved a list of large enterprises for privatization in 2018. It includes 26 enterprises: five regional electricity supply companies, Centrenergo, Odesa Port-Side Plant, Turboatom, Zaporizhia Titanium and Magnesium Combine, United Mining-Chemical Companyand Sumykhimprom.
“We are selling them to make investments and enterprises work efficiently. We need to attract qualified advisers to privatize large enterprises… We will get it over with the shadow privatization in Ukraine by this decision,” Prime Minister Volodymyr Groysman said, commenting on this decision at a meeting on Thursday, predicting a strong confrontation of opponents to this approach.
Head of the State Property Fund Vitaliy Trubarov said that 18 enterprises are already in the Fund’s management, including Ternopiloblenergo (50.999%), Zaporizhiaoblenergo (60.2475%), Kharkivoblenergo (65.001%), Mykolaivoblenergo (70%) and Khmelnytskoblenergo (70.0089%), Kherson (99.8328%), Dniprovska (99.9277%), Kryvy Rih (99.9864%) and Severodonetsk combined heat and power plants (CHPPs), Azovmash (50%), Turboatom (75.2241%), Zaporizhia Titanium and Magnesium Combine (51%), Oriana (99.9988%), Aluminum foil plant (state-owned enterprise), President Hotel (100%), Centrenergo (78.289%), Odesa Port-Side Plant (99.5667%) and Sumykhimprom (99.9952%).
Trubarov said that three enterprises are managed by the Ministry of Economic Development and Trade: United Mining-Chemical Company (100%), Electrotyazhmash and Dniprovsky Electric Locomotive Plant (state-owned enterprises), two more facilities are in the management of the Ministry of Agrarian Policy and Food – Agrarian Fund and the State Food-Grain Corporation of Ukraine (100%) and one each are subordinated to the Ministry of Energy and Coal Industry, the Cabinet of Ministers and the Ministry of Health: the Coal Company Krasnolymanska (state-owned enterprise), Ukragroleasing (100%) and Indar (70.7016%) respectively.