OREANDA-NEWS. November 07, 2011.
Poultry Division
Sales volumes in the Poultry division for the first nine months of 2011 increased by a robust 26% to approximately 185,620 tonnes of sellable weight compared to 146,830 tonnes for the first nine months of 2010, reflecting organic volumes added in the Bryansk cluster and sales by Mosselprom, acquired in May 2011, reported the press-centre of Cherkizovo Group.

Prices for poultry sales in dollar terms increased by 8% from USD 2.33 per kg for the first nine months of 2010 to USD 2.52 per kg for the first nine months of 2011 (excluding VAT)[1]. Compared to the second quarter of 2011, the price in the third quarter was almost flat at USD 2.53 per kg.

Prices in rouble terms increased by 3% from 70.56 roubles per kg for the first nine months of 2010 to 72.40 roubles per kg in the first nine months of 2011 (excluding VAT). Compared to the second quarter of 2011, the price in the third quarter increased 1% to 73.47 roubles per kg. 

Pork Division
Sales volumes in the Pork division for the first nine months of 2011 increased 7% to approximately 65,800 tonnes of live weight, compared to 61,250 tonnes for the first nine months of 2010. 

In dollar terms, prices for pork sales increased by 15% from \\$2.38 per kg of live weight for the first nine months of 2010 to \\$2.74 per kg of live weight for the same period of 2011 (excluding VAT)*. Compared to the second quarter of 2011, the price in the third quarter was almost flat at \\$2.80 per kg. 

Prices in rouble terms increased by 9% from 72.09 roubles per kg for the first nine months of 2010 to 78.90 roubles per kg for the first nine months of 2011 (excluding VAT). Compared to the price in the second quarter of 2011 the price in the third quarter increased by 2% to 81.37 roubles per kg. 

Meat Processing Division
Sales volumes increased by 5% to approximately 108,420 tonnes from 102,870 tonnes for the first nine months of 2010.

Prices in dollar terms increased by 19% from USD 3.82 per kg for the first nine months of 2010 to \\$4.54 per kg for the first nine months of 2011 (excluding VAT)*. Compared to the second quarter of 2011, the price in the third quarter was flat at USD 4.66 per kg.

Prices in rouble terms increased by 13% from 115.52 roubles for the first nine months of 2010 to 130.56 roubles per kg for the first nine months of 2011 (excluding VAT). Compared to the price in the second quarter, the price in the third quarter of 2011 increased by 4% to 135.27 roubles per kg. 

Commenting on the performance, Sergey Mikhailov, CEO of Cherkizovo Group said: 
"In the first nine months we have delivered strong results across all segments in line with our targets.

In poultry we have continued our organic growth, and in addition to opening two large poultry production facilities in our Bryansk and Penza clusters, we have launched two incubation facilities which are amongst the largest not just in Russia, but across Europe. Our results in the pork segment demonstrate that we have successfully overcome the consequences of last year’s weather conditions, and are now witnessing production growth.

In the meat processing segment we see a steady increase in demand for our meat products, while this year we are concentrating on improving the product mix in favour of value added products.

In terms of the pricing environment, we see that in poultry the prices so far this year have been relatively flat, while in pork they have demonstrated some growth. 

Overall, management expects that the Group will produce a strong financial performance for the nine months and will further continue to deliver against its strategy."

[1] For price calculation in dollar terms the Company used the average exchange rate for the first nine months of 2011 of 28.7664 roubles per 1 US dollar, for the first nine months of 2010 the average rate was 30.2538 roubles per 1 US dollar.