Cherkizovo Group reported a 10.4% year-over-year increase in revenue for the first quarter of fiscal year 2021.

The revenues rose to RUB33.3 million (US$450,000), the Russian agrifood company reported on May 20.

The company’s chicken segment saw a 3.1% decline in sales volume to 169.2 million metric tons, but with an average selling price increasing 22%, chicken revenue for the quarter increased 18.1%.

 The turkey segment saw an increase in sales volume of 8.3% and a 17.3% increase in revenue. Cherkizovo’s involvement in the turkey sector is through its 50-50 joint venture with Grupo Fuertes in Tambov Turkey.

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Cherkizovo also saw a 33.4% drop in sales volume and 11.2% drop in revenues for its pork segment, as well as a 3.6% increase in sales volume and 8.8% increase in revenue in its meat processing segment.

“Despite the slightly decreased sales in volume terms, Cherkizovo Group posted growth in revenue and net profit in Q1 2021. These results came on the back of increased average sales price in all segments, which in turn is driven by continued expansion of value-added products sales. This was particularly the case in the chicken segment, accounting for over 70% of the group's sales. Our flagship Petelinka brand continued to demonstrate stable volume sales, while Chicken Kingdom, another group brand, saw its volumes grow,” stated Sergei Mikhailov, CEO of Cherkizovo Group.

“The increase in production costs was partially offset by government support measures, with the export duty on grain helping to reduce its costs in Q1. However, going forward the growing prices of other ingredients including packaging and vitamins, will continue driving the costs up, potentially forcing the industry to raise selling prices. By leveraging its vertically integrated business model, Cherkizovo Group sought to prevent its prices from going up in Q1. In today’s challenging macroeconomic environment, we remain committed to striking the optimal balance that helps maintain adequate profitability without compromising consumer interests.”