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Bellesbumprom Group to increase exports to $1.4-1.5bn by late 2017

President 03.02.2014 | 10:16
MINSK, 3 February (BelTA) – The Bellesbumprom Group companies plan to increase exports to $1.4-1.5 billion by the end of 2017, up more than 2.4 times on 2013, Chairman of the Bellesbumprom Group Yuri Nazarov said at a meeting held on 31 January to discuss the state and development prospects of the companies affiliated with the Group, BelTA learnt from the presidential press service.

Yuri Nazarov noted that the implementation of all the projects which are currently underway would help increase the annual production output by 2017. It is expected that the trade surplus will reach $810 million, sales proceeds per average employee will make up $67,700, and wood processing depth will reach almost 81%. Thus, a brand new woodworking industry will be developed in the country, Yuri Nazarov stressed.

Yuri Nazarov has admitted that the performance of the Group's organizations is extremely inefficient at the moment. In 2013 only two out of four targets were achieved in the industry, i.e. the foreign trade balance and the correlation of exports and the industrial output. The margin on sales totaled 3.9% as against the annual target of 8%. Eleven companies of the Group operated in the red, while 30 others had profitability of sales under 5%.

As of 1 January 2014, backlogs of inventory totaled almost Br600 billion, or 81.2% of the monthly average industrial output. The average monthly salary neared Br5 million, or over $500, in December 2013. The accounts receivable amounted to Br3.5 trillion, with the accounts payable at almost Br3.2 trillion. Yuri Nazarov assessed the results as unsatisfactory. In his words, one of the reasons is the weakening of the coordinating role of the administrative machinery of the Group both in the current activity and modernization of basic organizations.

According to the Chairman of the Bellesbumprom Group, another fact that influenced the efficiency of the performance is the modernization being conducted in the operating organizations. In particular, Borusovdrev has had to halt its veneer and match production, an upgrade project at Gomeldrev has led to a 40% reduction in veneer production.

Speaking about the completion on modernization at the basic organizations, Yuri Nazarov assured that the goal would be reached in 2014 in line with the President's instructions. He added that the completion of modernization in time was possible only given continuous financing of investment projects. In his words, as of 1 January 2014, the amount of unused loans totaled €164.4 million, or almost 16% of the envisaged volumes.

According to Yuri Nazarov, operating furniture production lines are upgraded as part of the current modernization projects. Thus, an investment project will be completed at Ivatsevichdrev in 2015 to launch the production of furniture parts. However, according to the Chairman, it is still insufficient, and there is a need to elaborate an array of measures for further development of furniture production in the country.

Alongside with the modernization of woodworking companies, a large-scale upgrading project is underway at the pulp and paper industry slated for completion before 2015. The volume of investments makes up $1.4 billion. The project is aimed at the production of bleached sulfate, which will allow securing the pulp and paper industry of the country with high-quality fibrous raw material and viscose pulp.

Yuri Nazarov noted that the improvement of the financial situation at the companies of the Group and the securing of guaranteed repayment of loans are only possible through establishing an efficient system of sales. In his words, the product of the Group's companies is in demand. The main markets for new products will be Russia, Kazakhstan, Uzbekistan, Armenia, Azerbaijan and Turkey.

Yuri Nazarov stressed that it is necessary to improve the current system of sales through excluding domestic competition between the Group's companies on the operating markets. In his words, 2014 is a key year for basic companies taking into account new production and the development of the order portfolio both for exports and the domestic market.

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