State-owned enterprise (SOE) Ukrspyrt has relaxed the rules of buying spirit for the volume of up to 1,000 liters a quarter, and the rules will be in effect from March 20 until June 30.
“Almost everyone needs alcohol! Therefore, given the coronavirus disease COVID-19 pandemic and the increased demand for alcohol, we have simplified the process of its sale. The buyer needs to take three steps: conclude an agreement (simplified, we have one signatory), pay and come to get the products. The rules work, if you do not need more than 1,000 liters per quarter,” acting Director General of Ukrspyrt Serhiy Bleskun wrote on his page on the social network Facebook.
He said that alcohol can be bought by private entrepreneurs or legal entities. The rule is valid until June 30. Price for 1 liter is UAH 184 (inclusive of excise tax and VAT).
The press service of Ukrspyrt told Interfax-Ukraine that the number of signatories under a contract from a state-owned enterprise was reduced from nine to one, and the number of required documents from a buyer was reduced from nine to four.
As reported, Ukrspyrt suspended the shipment of alcohol for export and put four more distilleries into operation due to the increased demand for medical alcohol in Ukraine over the spread of COVID-19.
Ukrspyrt has suspended shipment of alcohol for export due to the increased demand for medical alcohol in Ukraine because of the spread of the coronavirus COVID-19, the company has said.
“We have taken the state’s position, first of all, to take care of Ukrainians. Due to the coronavirus pandemic, we are seeing an increased demand for medical alcohol not only domestically but also externally. Therefore, we decided to suspend export of alcohol. First we need to fully provide the Ukrainian market. We consider it is unacceptable if medical institutions turn to us with a request to sell alcohol, but we don’t have it. Therefore, we take care of the needs of our medical sector,” Ukrspyrt acting head Serhiy Bleskun said.
The company indicated that exports would be restored after the domestic market of Ukraine is fully provided.
As reported, Ukrspyrt in 2019 increased its net profit by 1.9 times compared to 2018, to UAH 40.3 million. Alcohol production fell by 5%, to 5.9 million decaliters.
State-owned enterprise Ukrspyrt is a large producer of alcohol and alcohol containing products in Ukraine. It is managed by the Ministry of Economic Development, Trade and Agriculture. Its total production capacity is more than 36 million deciliters per year. The work is provided by 41 production sites, while in March 2020 only ten are operating.
Now the company is being prepared for transfer to the State Property Fund for privatization
The strategy for the privatization of state-owned enterprise (SOE) Ukrspyrt envisages the transfer of property of the SOE as a pool of fixed assets of industrial sites to the State Property Fund of Ukraine (SPF) before June 1, 2020.
According to the presentation of Ukrspyrt, the necessary conditions for privatization are the completion of the registration of property of state-owned distilleries.
Now out of 41 Ukrspyrt’s industrial sites, 18 have all the property registered, another 18 have partially registered property, and five have been seized.
The main advantage of this privatization option for Ukrspyrt is the ability to transfer facilities for privatization before June 1, 2020.
Sales of spirit by state-owned enterprise (SOE) Ukrspyrt in January 2020 grew by 62% compared with the same period in 2019, to 412,000 decaliters.
“This is the result of the preparation of SOE Ukrspyrt for privatization and our common struggle with the Ministry of Economic Development, Trade and Agriculture, the State Tax Service and law enforcement authorities against the illegal spirit,” acting Director of Ukrspyrt Serhiy Bleskun said.
Last month, 11 Ukrspyrt distilleries were operating. “Last year, seven distilleries were operating at the same period, and sales amounted to 255,000 decaliters of ethyl spirit,” the enterprise said.
According to the company, in January 2019, the loss-making performance of Ukrspyrt amounted to UAH 5.5 million. In turn, the net profit of SOE in January 2020 reached UAH 2.6 million.
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.
State-owned enterprise Ukrspyrt in January-September 2019 received UAH 17.15 million in net profit, or 81% of the plan.
According to the published results of the unscheduled audit of the company, the income of Ukrspyrt for the first nine months of this year amounted to UAH 1.24 billion, or 89% of the plan.
In 2018, Ukrspyrt received UAH 21.61 million in net profit (60% of the plan) and UAH 1.86 billion (76% of the plan) of revenue, according to the audit report.
In addition, during the audit, it was determined that the provision of discounts by the state-owned enterprise on the price of alcohol was non-transparent, as a result of which Ukrspyrt saw a shortage of UAH 119.78 million.
In 2018, Ukrspyrt allocated UAH 112.36 million for maintenance of 15 non-performing enterprises, UAH 80.19 million for the nine months of 2019.
During 2018 and in the nine months of 2019, auditors recorded excess consumption of fuel and energy resources by individual plants for a total amount of UAH 19 million. It was also found that the purchase price of grain crops for the production of alcohol was overstated for a total amount of UAH 8.17 million.