Russia's Cherkizovo Group Sees Pork, Meat Processing As Most Profitable In Q1
The Cherkizovo Group, Russia’s largest meat producer, posted strong sales volume increases in its pork- and meat-processing divisions in the first quarter of the 2018 financial year.
Its meat-processing division grew sales volumes by 22%, largely due to the expansion of its distribution network and a jump in carcass sales, whereas the drop in sausage sales from the previous quarter, due to seasonal consumption trends, caused sales to fall. Sausage prices remained stable, whereas carcass prices and cuts were guided by live pork price shifts.
The company also posted a 28% year-on-year increase in production and sales volumes of its pork division as a result of a newly constructed facility. The relatively seasonal nature of live pork production caused a 9% drop in output, when compared to the previous quarter. Average sales prices (RUB 81.6 per kilogram) also experienced a drop when compared to the last quarter and year on year.
Price Of Poultry
The company's chicken division saw an increase in sales volumes, of 10% year on year, paralleling the previous quarter. There was a year-on-year decline in average sales prices, of 11% (amounting to RUB 82.07 per kilogram), due to the increased base effect of the previous year and the ‘seasonal slowdown effect’.
Its JV Tambov Turkey segment experienced a ‘robust’ increase in output, running at full capacity in the first quarter of 2018. However, the company said that sale prices were put under pressure as a major competitor re-entered the market at the end of 2017, resulting in an average of RUB 116.02 per kilogram.
In the full-year results for 2017, the Cherkizovo Group recorded sales volumes of 1.45 million tonnes, representing an increase of 16.5% compared to the previous year. The company announced recently that it had decided to postpone a planned share offering in Moscow, citing stock market volatility.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Karen Henderson. Click subscribe to sign up to ESM: European Supermarket Magazine.