Business news from Ukraine

KPMG TO PREPARE BILSHOVYK PLANT IN UKRAINE FOR PRIVATIZATION

KPMG Ukraine consulting firm has won the tender for the selection of an advisor for the preparation for privatization and sale of 100% of the charter capital of JSC First Kyiv Machine Building Plant (formerly Plant Bilshovyk, Kyiv), the press service of the State Property Fund of Ukraine (SPF) has told Interfax-Ukraine.
“The winner was KPMG Ukraine. There were three applications in total. KPMG won, as it scored the most points. The agreement with KPMG has already been signed. Documents are being prepared for the approval of the privatization adviser by the Cabinet of Ministers,” the press service told the agency.
As reported, at the end of September 2020, Head of the State Property Fund Dmytro Sennychenko said that Bilshovyk Plant was included in the list of objects for privatization formed by the fund for next year.
According to the information on the SPF’s website, the tender for the selection of a privatization adviser was announced in August this year. At the same time, the tender committee made a number of decisions for the successful privatization of this asset.
“Despite resistance, attempts to alienate property by raider methods and political pressure, we are moving privatization forward. At a transparent tender, an advisor will be selected who will qualitatively prepare the privatization object to attract an investor,” Sennychenko said.

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CEREAL PLANT RECEIVES EUR 247,000 IN NET PROFIT

Cereal Plant, a leading producer of cereals in Ukraine, in January-June 2020 receive EUR 247,000 in net profit compared to EUR 26,000 over the same time in 2019.
According to a reported of Cereal Planet PLС holding on the Warsaw Stock Exchange on August 14, its revenue over the review period doubled to EUR 17.47 million and gross profit increased by 2.3 times, to EUR 3.99 million.
In April-June 2020, Cereal Planet saw EUR 246,000 in net profit against EUR 2,000 in Q2, 2019. Its revenue increased by 2.1 times, to EUR 9.96 million, and gross profit – by 2.3 times, to EUR 2.19 million in Q2, 2020.
Cereal Planet said in its report that the coronavirus (COVID-19) pandemic did not affect the company’s work. In addition, weather conditions were favorable for a good grain harvest, therefore the company expects good supplies of raw materials. The company will also expand sales on international markets and constantly looks for customers all over the world.
According to the report, in January-June 2020 the company saw a 48% rise in exports, to EUR 7.47 million, as compared to H1, 2019. Export accounted for 42% of the total sales. Imports in H1, 2020 increased by 5.9 times, to EUR 1.58 million.
In the first half of 2020, the company increased production of cereals by 1.7 times, to 23,100 tonnes compared to the same time in 2019. Production of peas tripled, to 11,750 tonnes, buckwheat – by 43%, to 4,100 tonnes, bulgur – by 2%, to 2,840 tonnes, millet – by 42%, to 2,390 tonnes, barley groats – by 1.7 times, to 296 tonnes.
In Q2, 2020, Cereal Plant increased cereals production by 1.7 times as compared to April-June 2019, to 10,240 tonnes. Production of peas increased by 2.7 times, to 4,840 tonnes, buckwheat – by 14%, to 1,540 tonnes, millet – by 3.6 times, to 1,160 tonnes, barley groats – by 48%, to 628 tonnes, while bulgur output dropped by 19%, to 1,160 tonnes and flakes production was 60% down, to 169 tonnes.
Cereal Planet produces weight groats for the B2B segment under the Olimp trademark (Bulgur, Ridlana, Mayfayna, Zlatokositsa product lines) and animal feed mixes under the Lyuba Ferma trademark. The company exports groats and cereals to more than 50 countries (China, India, Germany, Italy, the United Arab Emirates, Poland, Turkey, etc.).
According to the group, Cereal Planet accounts for up to 10% of the Ukrainian cereals market. Its monthly output is 4,500 – 5,000 tonnes.
Its owners are Anatoliy Vlasenko and Oleksandr Vlasenko with 33.53% and 29.93%, respectively, as well as Oleksandr Slavhorodsky with 29.93% and Ihor Dobruskin with 5.5%.

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DNIPROVSKY METALLURGICAL PLANT RESTORES PRODUCTION

PJSC Dniprovsky Metallurgical Plant (DMZ, former Evraz-DMZ), a member of DCH Steel Group, owned by Oleksandr Yaroslavsky, following the launch of blast furnace and rolling shops No. 1 and No. 2 in June of the current year after maintenance works since October 2019, continues to restore and increase the production.
The company told Interfax-Ukraine that the company produced 17,000 tonnes of rolled steel in July, smelted 22,000 tonnes of steel, 20,000 tonnes of cast iron, while in June there were produced 10,000 tonnes of rolled steel, 13,000 tonnes of steel, and 18,000 tonnes of cast iron.
Previously, the company said that the enterprise is reaching the set technical parameters for the implementation of production plans.
The enterprise said in the press-release that representatives of TÜV SÜD company have carried out recertification audits of the quality management system, environmental management system at the DMZ as well as a thorough inspection of hot-rolled steel production control system for the compliance with international standards.
The auditors interacted with the leaders of subdivisions and employees, visited the workshops, the technical control department, and the central plant lab, requested the necessary documentation for each of the directions.
“The plans have been fully implemented within three days. During the final meeting with the working group, the auditors have confirmed that all systems at the enterprise operate according to the standards. They [auditors] will advise issuing DMZ certificates of conformity to the TÜV SÜD standards. Availability of certificates entitles DMZ to ship its products to foreign customers,” reports the press release.
It was informed at the end of May of the current year that DMZ is ready to launch the blast furnace and rolling mills.
DCH’s investment programme for the development of the DCH Steel mining and metals division (DMZ and Sukha Balka Mine) envisages investments of $300 million over the next five years.
The implementation of investment projects was supported by DMZ specialists who carried out necessary maintenance works and launched the plant.
The plant focuses on the processing of steel, cast iron, rolled steel, and its products.
Since 2016, the investment in environmental programmes amounted to UAH 350 million.

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CHEMALLIANCE LAUNCHES LIQUID FERTILIZER PLANT

Chemical Alliance LLC (ChemAlliance) has launched a plant for the production of liquid complex fertilizers with a capacity of 50,000 tonnes per year in Poltava region in the middle of April. According to the company’s press release on Tuesday, April 21, the first batch of finished products have already been produced and shipped to customers. Fertilizers at the Poltava plant are produced using acid synthesis technology. The total capacity of the enterprise is 50,000 tonnes of liquid complex fertilizers per year. The complex produces fertilizers under the BlauPhos trademark.
The company told Interfax-Ukraine that investments in opening the plant in Poltava region amounted to about EUR 2 million.
Chemical Alliance LLC (Poltava) was established in 2010. It is engaged in production and sale of liquid mineral and granular fertilizers.

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KOSTAL GROUP PLANS TO CONSTRUCT SECOND AUTOMOTIVE ELECTRONICS PLANT IN UKRAINE

The second plant for the production of automotive electronics of Kostal Ukraine LLC, a subsidiary of Germany’s Leopold Kostal GmbH & Co, will be constructed in Boryspil district of Kyiv region, the press service of Boryspil district state administration has said.
“Despite quarantine in the country, cooperation with foreign investors continues. Recently, Boryspil district state administration and Kostal Ukraine LLC have signed a memorandum of cooperation and interaction under the project to construct the plant for the production of mechatronic products (automotive electronics) in the territory of Dudari rural council. The main office in Germany confirmed the intention to construct the plant,” the press service said on the website of the district state administration.
There are intentions to create 900 jobs at the plant.
Currently, Kostal Ukraine has a production site of automotive components in Pereiaslav (Kyiv region), established in 2006, where about 1,000 employees are currently working.
KOSTAL Group consists of 31 companies in 17 countries. The main activities are the development and production of technologically advanced electronic and electro-mechanical products for the automotive industry.

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INTERPIPE PLANT BUILDS NEW WAREHOUSE FOR SHIPMENT OF RAILWAY PRODUCTS FOR EXPORT

PJSC Interpipe Nyzhniodniprovsky Pipe Rolling Plant (Dnipro) has built and commissioned a new warehouse at the export site of the company’s wheel-rolling shop, investing $271,000 in the project.
According to the quarterly report of the company, at the beginning of 2020, Interpipe plant provided itself with an additional warehouse for finished products, and a collection point was established for packing additional volumes of wheels in pallets.
“The new storage was organized to reduce the cost of packaging for sending railway wheels for export,” it said.
In addition, the company began using wooden pallets instead of metal cassettes for products that are shipped to Europe by truck, transported by road.
The report also states that in March steel indices in the global markets declined due to a sharp drop in demand. At the same time, the cost of scrap metal HMS 80/20 CFR Turkey fell by $20.7/tonne, or 7.6% compared to the previous month, the cost of square billets FOB Black Sea by $18.1/tonne or 4.7%.
“Most of the traditional trade outlets for steel billets of CIS production were inactive due to blocking and restrictive measures introduced by the governments during the pandemic. The demand was seen mainly in China,” the report said.
The Ukrainian market has also suffered due to protective measures in the fight against coronavirus, in particular, the hryvnia has depreciated by 14.3% since the beginning of March, construction volumes were down. The output of railway wagons also decreased.

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