Business news from Ukraine


State-owned enterprise Ukrspyrt intends to sell 440,600 decaliters of alcohol in January 2020 against 255,170 decaliters in the same period in 2019 and associates this with the results of fight against production of counterfeit alcohol.
“These figures indicate not the fact that we began to produce or consume more alcohol in the country, but the fight against the shadow turnover of alcohol. The state focused on the elimination of counterfeit alcohol production schemes that previously existed at the plants of the enterprise. We are closely monitoring the cost of alcohol and the correct purchase of raw materials. And if we see any violations, we immediately change the heads of the plants. And this is already yielding results,” acting head of Ukrspyrt Serhiy Bleskun said.
According to Ukrspyrt, in January 2020 ten factories of the state-owned enterprise will work, while seven were operating in the same period last year.
In addition, the enterprise noted that in November-December 2019 the heads of six plants were changed, and video surveillance cameras with online broadcasting were installed at six plants.
Now the company is being prepared for transfer to the State Property Fund.
As reported, the law on the abolition of state monopoly on alcohol production from July 1, 2020, supported by the Verkhovna Rada on December 3, was signed by the president of Ukraine at the end of December 2019.

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Ovostar Union agricultural group of companies, one of the leading producers of eggs in Ukraine, in January-September 2019 reduced egg sales by 15.9% compared to the same period in 2018, to 888 million pieces, due to a decrease in trading activity.
According to the group’s report on the Warsaw Stock Exchange, egg production during this period declined by 0.9%, to 1.191 billion pieces.
Egg exports for the nine months of this year were down by 0.7%, to 440 million eggs. The share of exports in the total volume of egg sales was 50% compared to 42% for the same period in 2018.

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More than half of Ukrainians do not approve of the lifting of the moratorium on agricultural land sales, and 64% believe that this issue should be resolved in a referendum, according to a study conducted by the Kyiv International Institute of Sociology (KIIS)on September 16-19, 2019. According to the survey, 52% of respondents do not approve of the instructions of President of Ukraine Volodymyr Zelensky to lift the moratorium (ban) on the sale of agricultural land until October this year and the introduction of land sale until December this year. Some 35% of those surveyed are positive about this order, while 13% of respondents had difficulty answering the question.
Some 64% of respondents believe that the issue of agricultural land sale should be solved only in an all-Ukrainian referendum, and 26% believe that the issue should be resolved by the president, the Verkhovna Rada and the Cabinet of Ministers, while 10% of respondents could not answer the question.
Director General of the Kyiv International Institute of Sociology (KIIS) Volodymyr Paniotto noted that the number of opponents of land sale has decreased over the year – 72% were against the land sale in November 2018.
The survey was conducted by CATI method (computer-assisted telephone interviews) based on a random sampling of mobile phone numbers. The sample is representative of the adult population of Ukraine (18 years and older). The sample does not include territories temporarily not controlled by the authorities of Ukraine – the Autonomous Republic of Crimea, certain areas of Donetsk and Luhansk regions. During the survey, 1,500 interviews were conducted. The sampling error with a probability of 0.95 does not exceed 2.6%.

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Poland’s fashion retailer LPP Group, which manages the Reserved, Cropp, House, Mohito and Sinsay brands, in January-June 2019 saw a 29.3% rise in sales in Ukraine year-over-year, to PLN 194.2 million (around $49.7 million). According to the company’s financial statements, LPP total sales revenue for six months grew by 11.3%, exceeding PLN 4 billion (about $1 billion). At the same time, one of the highest sales growth pace was recorded in Ukraine.

In the first half of the year, LPP revenue abroad exceeded domestic revenues, being PLN 2 billion (49.6% of the group’s total sales). The largest volumes of foreign sales are in Russia (17.9%), the Czech Republic (5%), Ukraine (4.8%) and Romania (4.0%). Thus, the Ukrainian market for the Polish retailer remains the fourth largest in the income structure.

According to the results of the reporting period, all LPP brands showed an increase in like-for-like sales. The highest growth was seen in the stores House (double-digit) and Sinsay.

In the second half of 2019, the group plans to launch an online store in Ukraine and for all EU countries. According to the report, thanks to the launch of e-commerce in these markets in 2019, the revenue of the online channel will exceed PLN 1 billion.

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Sopharma AD pharmaceutical company in January-June 2019 increased sales in Ukraine by 35% compared to the same period in 2018.
The company reported that, in general, in the first half of 2019, revenue from the sales to European countries rose by 13% compared with the first half of 2018.
The main reasons for sales growth in Europe are higher sales in Ukraine, as well as in Russia, where sales in January-June grew by 7%.
As reported, in 2014 Sopharma reduced sales in Ukraine by 37%, but in 2017 the company expressed confidence in the resumption of sales growth in Ukraine.
In Ukraine, Sopharma AD has been controlling PJSC Vitamins since January 2008, and in August 2012 it established the subsidiary Sopharma Ukraine LLC (Kyiv) to optimize trading business.

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Ovostar Union, one of the leading producers of eggs in Ukraine, in January-June 2019 reduced sales of eggs by 10.2%, to 610 million units due to a significant reduction in trade operations.
According to the company’s report posted on the website of the Warsaw Stock Exchange, the company produced 782 million eggs against 787 million units for the same period last year.
Exports grew by 14%, to 335 million eggs, thus, the share of export in the total structure of sales is estimated at 55%.
The group of companies said that the average price of eggs fell by 8.7%, to $0.063/piece compared to the same period in 2018.
As of June 30, 2019, the total number of hens at the holding was 7.6 million, which is 2.7% more than on the same date in 2018. The number of laying hens increased by 4.8%, to 6.5 million.
According to Ovostar Union, the volume of egg processing in January-June of the current year grew by 5%, to 293 million units. Production of liquid egg goods during this period rose by 19%, to 7,210 tonnes, dry egg products decreased by 8%, to 1,530 tonnes.

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