Cherkizovo Group, Russia's biggest vertically-integrated meat producer, recorded net profits of RUB 8.7 billion (€110 million) in the first half of 2018, up 70.5% from the same period a year ago.
The group released its interim results earlier this week for the period ending June 30, and added that its net profits in the second quarter alone were RUB 5.8 billion – an increase of 81.4%.
Its net operating cash flow decreased in the first half of the year by 25.9% to RUB 4.8 billion, falling by 13.4% in the second quarter.
Positive Developments
“We had a number of positive developments in the first half of 2018, which set the stage for further growth in the upcoming quarters,” commented Sergei Mikhailov, chief executive of Cherkizovo Group. “Underlying consumer demand remained robust, supported by stable real disposable income and a temporary consumption boost fuelled by the FIFA World Cup.”
Mikhailov said that the group expanded its market share in St Petersburg and the North-Western Federal District having only entered these markets a year ago.
In the north west, its Petelinka brand became one of the top-selling products in the poultry category, and general sales of its poultry brands saw double-digit growth in the first half of the year, driven by a “strong expansion in the modern retail channel”.
Despite this, Cherkizovo recently announced that its chicken volumes fell in the second quarter, with its turkey volumes saw a marginal increase.
“In parallel with increased focus on product marketing, we continue to emphasise production efficiency, biosecurity, and food safety, in order to better manage costs, drive share and grow profitability,” added Mikhailov.
“The previous years’ investments in production expansion, cost optimisation and customer acquisition are being rewarded by the favourable market conditions and inspire confidence as we move into the second half of the year and beyond.”
Kashira Plant
Recently, the group launched the first phase of its new Kashira meat processing plant in the Moscow Region, with the capacity to produce 30 thousand tonnes of finished meat products per annum.
The facility, Cherkizovo claims, embraces the ‘industry 4.0 philosophy, with a fine-tuned production system of AI and robotic interactions ensuring control over the entire production cycle’.
The second phase of the Kashira complex has been agreed upon and invested in by representatives of the Moscow Regional Government.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Aidan O'Sullivan. Click subscribe to sign up to ESM: European Supermarket Magazine.
