From: LexisNexis(TM) Print Delivery <[log in to unmask]>
To: [log in to unmask]
X-Sender: IDS Mail Supervisor
Date: Sun, 26 Aug 2001 21:42:57 -0400 (EDT)
Subject: LexisNexis(TM) Email Request (702:0:33641712)
Copyright 2001 Interfax News Agency
Russian Company News
July 19, 2001, Thursday
LENGTH: 2683 words
HEADLINE: BALTIKA BREWING COMPANY
BODY: BALTIKA BREWING COMPANY
Baltika Brewing Company is the largest beer maker in Eastern Europe
and Scandinavia and employs state-of-the-art European technology. The
company's flagship brewery is located in St. Petersburg. It also controls
the Baltika-Don brewery in Rostov-on-Don and the Tulskoye Pivo brewery in
Tula, as well as 16 distribution organizations in Moscow and other Russian
cities.
HISTORY AND BRIEF DESCRIPTION
Baltika had its first bottles of beer ready for sale in November 1990.
Initially the company brewed beer under the Zhigulyovskoye, Rizhskoye and
Moskovskoye labels, as specified by GOST, the state alcohol agency. From
1993 to 1998, it produced beer exclusively under the Baltika label. Today
the company produces 20 different brews under the Baltika label. In 1998 it
introduced three new beers under the Don label. A year later it added two
beers under the Medovoye label and five under the Arsenal label and it is
now rolling out its Baltika N0 non-alcoholic beer and Baltika N8
Pshenichnoye (Wheat) beer.
Baltika embarked on a five-year investment program in 1993, which was
subsequently completed ahead of schedule, in 1996. The program was one of
the largest in the Russian food and beverage industry. From 1993 through
2000 investment topped$ 347 million, mainly financed internally. Most
recently, investment flows have gone toward reconstruction of the Rostov
and Tula subsidiaries, although modernization of the St. Petersburg plant
continues, with a total of$ 30 million invested in 2000. The program
included installation of 36 fermentation tanks supplied by Germany's
Ziemann, as well as installation of beer filtration and bottling equipment.
Production of canned beer was added to the St. Petersburg brewery at a
cost of about$ 21 million. It included installation of equipment from
Germany's KNS with capacity to fill 60,000 half-liter cans or 80,000 0.33-
liter cans an hour. The new line was added following startup of a new$ 6
million brewing line using equipment from Germany's Huppmann.
Baltika believes production of canned beer will help to expand its
export business, currently 2% of total production. The company plans to
increase that share to 10% in the next two or three years, while at the
same time expanding its export market area.
In addition, Baltika has been working to set up its own distribution
network since 1998. It now has company distributors in 16 of Russia's
largest cities, along with the Baltika-Moscow subsidiary. The company's
PAGE 2
Russian Company News July 19, 2001, Thursday
product is supplied throughout Russia. Exports to other CIS countries,
Western Europe and the Middle East began in 1999. Baltika's domestic market
share reached 18% last year. It plans to increase that figure to 25% by
2003.
Baltika company employees, 1994-2001
1994 1995 1996 1997 1998 1999 2000* 2001*
654 758 871 1208 2311 4000 6700 7000
*- Including the St. Petersburg, Rostov-on-Don and Tula breweries and the
distribution organizations.
PRODUCTION IN 2000-2001
Baltika produced 1.06 billion liters of beer in 2000, 62.4% more than
the 655 million liters produced in 1999. Production last year was higher at
all of the company's breweries, including 774 million liters at the St.
Petersburg brewery (up from 573 mln liters in 1999), 138 mln liters at
Baltika-Don (up from 82 mln liters) and 156 mln liters at Tulskoye Pivo (up
from 97 mln liters).
In the first four months of 2001, Baltika shipped 372 mln liters worth
$130.2 mln, up from 288 mln liters worth$ 88.1 mln a year earlier. (The
figures for 2000 exclude production at Tulskoye Pivo, which joined Baltika
later).
Production at the St. Petersburg brewery totaled 234 mln liters in the
first four months of 2001, down 8% from the 254 mln liters produced in the
same period last year. Production at Baltika-Don posted a year-on-year rise
of 83%, to 49.7 mln liters, up from 27.1 mln liters a year earlier.
Tulskoye Pivo shipped 87.9 mln liters in the first four months of the
current year, up 260% from the 24.6 mln liters shipped a year earlier. The
increase followed investments from Baltika totaling$ 40 mln in 2000 and
another$ 5 mln so far this year.
The company reported that domestic market share in January-April 2001
rose to 22%, up from 18% a year earlier.
Total Russian beer production rose to 5.49 bln liters in 2000, up from
4.46 bln liters the previous year, while per capita consumption increased
to 38 liters, up from 30 liters. At the same time, beer imports saw their
market share fall to 1% from 2% the previous year.
BALTIKA-DON
Baltika acquired a controlling stake in the Donskoye Pivo brewery
toward the end of 1997. At that time, Donskoye Pivo was one of the largest
brewers in southern Russia with capacity to produce 72 mln liters a year.
Baltika embarked on an investment program to re-equip plant at the
brewery, subsequently renamed Baltika-Don. Those efforts produced a
substantial increase in output in the first half of 1998 and an expansion
of the sales area, earning Baltika-Don a leading market position in
southern Russia. The first phase of the reconstruction project- totaling
$30 million- raised capacity to 100 mln liters a year.
Baltika-Don's domestic market share reached 2.5% last year, when the
brewery produced 138 mln liters, making it one of the nation's 10 largest
PAGE 3
Russian Company News July 19, 2001, Thursday
breweries. Its share of the market in Rostov and the surrounding Rostov
region currently amounts to almost 99%.
The second stage of the modernization, in 1999-2000, included
reconstruction of the brewing plant, expansion of the fermentation line,
acquisition of new 50,000 bottle-per-hour bottling equipment, and
renovation of the warehouses for storing empty bottles and containers and
ready product.
Capital investment totaled$ 23 million in 2000, of which Baltika-Don
produced 34% internally.
The third stage of the modernization, completed in April 2001,
involved addition of 14 new fermentation tanks (350 cubic meters), four
vessels for storing filtered beer, startup of a new, fully-automated beer
filtration line, acquisition of additional transport, and addition of
warehouse space for 200,000 cases.
Baltika-Don's goal for 2001 is to further improve product quality
while expanding production, to 200 mln liters a year. This fourth phase of
the modernization- costing$ 12.8 million- will bring the total amount
invested to about$ 70 million.
Baltika-Don also plans to have its product certified this year under
the MS ISO 9001-94 standard.
Company revenues last year rose 130% to 1.282 billion rubles and sales
profit rose 180% to 480 million rubles. Net profit in 2000 rose to 382
million rubles, triple the figure for 1999, while assets rose 180% to 1.232
billion rubles.
Baltika-Don paid a dividend for 2000 of 195 rubles per ordinary, 600-
ruble share, up from 66 rubles per ordinary share a year earlier.
Baltika-Don has charter capital totaling 105,652,800 rubles. Baltika
owns 81% of shares.
TULSKOYE PIVO
Baltika acquired a controlling stake in Tulskoye Pivo in 2000, after
which it carried out a comprehensive reconstruction. By May the brewery was
making a profit and had join the ranks of the 10 largest breweries in
Russia.
Tulskoye Pivo's beer production rose 60% to 156 mln liters last year.
Domestic market share rose to 2.7%.
The investment program carried out last year boosted capacity to 200
mln liters a year. The program featured installation of a bottling line
with capacity to fill 50,000 half-liter bottles an hour and a line with
capacity for 18,000 plastic 1.5-liter bottles an hour. In addition, the
fermentation and brewing lines were rebuilt, including a revamped brewing
line, installation of 43 fermentation tanks and 12 filtration and yeast
tanks, acquisition of an autoloader, and expansion of the warehouse for
storing ready product. Investment in the brewery last year totaled$ 40.5
million.
PAGE 4
Russian Company News July 19, 2001, Thursday
The latest phase of the modernization- boosting capacity to 300 mln
liters a year- is currently under way. Installation of a new brewing line
(with equipment from Germany's Huppmann) and installation of cylindrical
fermentation tanks (from Germany's Ziemann) are slated for completion
before the end of the current year. In addition, plans are to automate
storage operations in the elevator, to rebuild the boiler and cold-
compression plants and further expand the warehouse for ready product.
Tulskoye Pivo will pay a dividend of 5.6 rubles per ordinary share and
11.26 rubles per preferred share for 2000.
The company has charter capital of 187,577,637 split into 1,553,996
ordinary, 5,955 preferred Type A shares and 5,955 Type B shares, each with
par value of 112.6 rubles.
Tulskoye Pivo financial highlights, 1999-2000, shipped basis, mln rubles
1999 2000
Sales revenues 535.95 1255.36
Production cost 277.91 712.92
Profit on sales 187.06 436.35
Pretax profit 75.04 374.45
Profit tax 17.37 83.91
Net profit 57.67 290.54
Source: Russian Federal Securities Commission.
KRINITSA
Baltika is on target to acquire a controlling stake in Krinitsa, a
Belarussian brewery currently controlled by Belgosposcheprom, before the
end of 2001, but the details of the acquisition have still not been
finalized. The takeover might take the form of a supplementary issue of
shares, outright purchase, or a combination of the two.
Baltika's general director, Taimuraz Bolloyev, confirms that agreement
has been reached with the Belarussian company to invest$ 50 million in
reconstruction of Krinitsa in 2001-2002.
The first stage of the investment program will boost capacity at
Krinitsa to 100 mln liters a year. Completion of the final phase will
increase capacity to 150 mln liters a year- roughly double current
capacity.
Krinitsa will produce local brands, although in future it might start
to make beer for the Baltika label.
The Belarussian market is an appealing one for Russian brewers. Total
capacity of Belarus' brewers is 350 mln liters a year. They produced 235
million liters in 2000.
BALTIKA FINANCIAL RESULTS IN 2000-2001
Baltika reported net profit of 2.14 billion rubles for 2000 on pretax
profit of 2.73 billion rubles (compared to 1.62 billion rubles in 1999).
Sales revenues rose to 8.91 billion rubles (4.53 billion rubles).
Payables rose to 1.28 billion rubles, up from 680 million rubles a
PAGE 5
Russian Company News July 19, 2001, Thursday
year earlier.
In the first four months of the year, consolidated company net profit
rose 20.5% to$ 29.4 million, up from$ 24.4 million a year earlier.
BALTIKA BALANCE SHEET, MLN RUBLES
01.01.2000 01.01.2001 01.04.2001
ASSETS
Long-term assets
3947.88 4899.24 5004.36
Intangible assets 2.75 8.06 12.69
Tangible assets 3751.61 3655.60 3876.06
Uncompleted construction 103.70 511.20 379.70
Long-term investments 89.83 724.37 735.91
Investments in 78.49 635.47 635.47
subsidiaries
Investments in associates 10.09 87.65 99.19
Investments in other 1.26 1.25 1.25
organizations
Current assets 1213.80 2379.90 2700.99
Inventories 572.55 801.17 832.74
VAT on inventory 25.10 88.60 72.13
Long-term accounts- 10.28 10.07
receivable
Short-term accounts 315.39 321.07 410.17
receivable
Short-term investments 162.62 1067.91 1193.61
Cash and cash equivalents 138.10 90.76 182.19
Other current assets 0.04 0.11 0.08
Total 5161.68 7279.13 7705.34
LIABILITIES AND
SHAREHOLDERS' EQUITY
Equity and reserve funds 4481.41 5996.72 6218.87
Authorized stock 120.57 120.57 120.57
Paid-in capital, 1788.73 1788.49 1788.49
revaluation of assets,
gifts
Reserve funds 30.74 30.74 30.74
Social infrastructure fund 0.03 0.03 0.03
Retained earnings from 2541.33 4056.88 3891.55
previous years
Retained earnings from-- 387.48
current year
Long-term liabilities- 563.20 574.80
Short-term liabilities 680.27 719.21 911.68
Debt 108.60 5.59 21.03
Accounts payable 552.42 668.07 709.21
Dividends payable 3.66 14.98 169.84
Reserve against future 15.60 30.57 11.59
expenses
Total 5161.68 7279.13 7705.34
Source: Russian Federal Securities Commission.
BALTIKA FINANCIAL HIGHLIGHTS, 1999-2001, SHIPPED BASIS, MLN RUBLES
1999 2000 01.04.2000 01.04.2001
PAGE 6
Russian Company News July 19, 2001, Thursday
Sales revenues 4533.41 8912.69 1624.66 2123.93
Production cost 1987.38 4853.65 777.74 1266.19
Profit on sales 2546.03 4059.04 846.92 857.75
Profit on sales 1814.08 2820.20 616.29 528.40
Pretax profit 1620.75 2727.17 592.38 460.11
Profit tax 175.98 590.85 128.82 72.63
Net profit 1444.78 2136.32 463.56 387.48
Source: Russian Federal Securities Commission.
CHARTER CAPITAL
Baltika has charter capital of 120,572,800 rubles split into 1,338,590
common and 168,570 preferred shares, each with par value of 80 rubles.
Baltic Beverages Holding, which has invested over$ 45 million in the
company, holds a 75% stake.
Shareholders approved a 80:1 stock split at their annual meeting on
March 28, 2001 in order to increase liquidity. Each 80-ruble share will be
exchanged for 80 one-ruble shares. Shareholders also approved a motion
changing the title of the company head from "general director" to
"president."
The company will pay a dividend for 2000 of 253 rubles on each
ordinary and 329 rubles on each preferred, 80-ruble share, up from 173
rubles and 225 rubles respectively the previous year.
This article was written by the Interfax Center for Economic Analysis.
E-mail: [log in to unmask]
Tel.: 250-85-20, 250-85-03
LOAD-DATE: August 02, 2001
--
|
