Production, share ownership expanded at Cherkizovo

Russia’s agri-food giant, Cherkizovo Group, has reported half-year results that show its poultry and pig meat divisions have increased sales compared to the same period of the previous year.

(Cherkizovo Group)
(Cherkizovo Group)

Russia’s agri-food giant, Cherkizovo Group, has reported half-year results that show its poultry and pig meat divisions have increased sales compared to the same period of the previous year. For two those of the businesses, this has been achieved in the face of declining average prices.

Pork division performance

For the Pork division, production volume is up by 19 percent for the quarter and 13 percent over the half-year, thanks to two new pig rearing facilities in Voronezh coming on stream and the production boost resulting from the incorporation of improved genetics. Output was almost 54,000 tons and 98,400 tons for the three- and six-month periods, respectively. Average price for the half-year was 13 percent higher, which the firm attributes to the success of increased promotion leading to growing consumption.

Poultry division performance

While the average price for Cherkizovo’s Poultry division was 3 percent lower in the second quarter than for the same period the previous year, the half-year figure is 1 percent higher. For the quarter and the half-year, production was 129,400 tons (+3 percent), and 254,900 tons (+1 percent), respectively.

Meat processing division

A combination of a wider product range and geographical sales contributed to push up sales by the firm’s Meat Processing division by 13 percent for the quarter (to 56,800 tons) and 4 percent for the half year (to 107,300 tons). However, a new trading law limiting retroactive bonuses put downward pressure on average prices. Compared to the same period of the previous fiscal year, these were down 2 percent for the quarter and by 7 percent for the half-year.

Grupo Fuertes increases shareholding in Cherkizovo

In the last week of July, Cherkizovo Group announced its controlling shareholder had decreased its share in the Group. MB Capital Europe had sold almost 1.9 million shares or 2.89 percent to Grupo Corporativo Fuertes, S.L., increasing the latter’s shareholding in Cherkizovo to eight percent.

Also known as Grupo Fuertes, it is among the largest agricultural cooperatives in Spain, and comprises 20 companies, including Cefusa (breeding and fattening of white and Iberian pigs, and cattle), Procavi (integrated turkey production), and Fripozo (frozen foods).

In 2012, Cherkizovo Group and Grupo Fuertes entered into a 50/50 partnership agreement to develop Tambov Turkey (Tambovskaia Indeika), a turkey meat production facility, which was inaugurated last May and is scheduled to reach full production this year.

The Spanish firm acquired a share in Cherkizovo of just over five percent in 2015.

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