The performance by Cherkizovo Group during the year to date demonstrates a strong recovery of both its domestic and export markets.
That is how Sergei Mikhailov, CEO of Russia-based agri-food company, Cherkizovo Group, characterizes the company’s performance for the first nine months of this year. Recovery of the business as well as home and export markets were achieved higher production from domestic competitors, he said.
For the third quarter, the group’s total revenue was up two percent at RUB22.78 billion (US$380 million) from the previous three-month period. Operating expenses were 12 percent higher, however, so adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) was down by 15 percent from the second quarter, and operating profit was 64 percent lower.
Mikhailov commented that both the poultry and pork markets showed a downward trend in the third quarter, leading to weaker prices that could hit the firm’s future profitability in the short term.
Compared to the same period last year, Cherkizovo Group achieved a 12 percent increase in revenue for the first nine months of 2017 at almost RUB66.13 billion (US$1.12 million).
With operating expenses just one percent higher so far in 2017, adjusted EBITDA rose 119 percent to almost RUB11.70 billion (US$200 million), and operating profit was up 127 percent to just over RUB8.12 billion (US$140 million).
Production figures for the firm’s poultry, pork and meat processing divisions for the period were released around one month ago.
Russia’s largest vertically integrated meat and feed producer, Cherkizovo Group completed a Share Buyback Offer in October, purchasing 0.93 percent of the group’s share capital for RUB532 million (US$9 million). The move gave its leading shareholder and affiliates control of 98.62 percent of the group’s equity.
