OREANDA-NEWS. MHP S.A. (LSE: MHPC) ("MHP" or "The Company"), one of the leading agro-industrial companies in Ukraine, focusing on the production of poultry and the cultivation of grain, announces its pre-close trading update for the three months ended 31 March 2013.

Vinnytsia - expansion project

All production sites of the Vinnytsia complex are operational and gradually increase their capacity outcome.

Currently 6 chicken rearing zones are operational and 3 more rearing zones will be constructed and launched into operations by the end of the year. As a result, it will increase MHP annual chicken meat production volumes by 60,000-80,000 tonnes in 2013.

Poultry and Related Operations

Poultry

Q1 2013

Q1 2012

% change

Sales volume, third parties tonnes

91,720

85,040

8%

Price per 1 kg net VAT, UAH

16.33

16.75

-3%

Due to the gradual launch of the Vinnytsia poultry complex since the end of 2012, MHP’s overall poultry production volumes in Q1 2013 increased by 15% and constituted 103,420 tonnes of poultry compared to 90,260 tonnes produced in Q1 2012.

Sales of chicken meat to third parties in Q1 2013 increased by 8% reaching 91,720 tonnes of chicken meat compared to 85,040 tonnes in Q1 2012. As usual, the Company’s poultry production facilities continued to operate at full capacity during the period. All production sites of the Vinnytsia complex, that were launched in operations during the period, worked at full capacity.

Export Sales: In line with the Company’s growth strategy of its export sales, during the first quarter of 2013 the volume of chicken meat export increased and reached 23,200 tonnes, which almost triples export volumes in Q1 2012. During the period the Company significantly increased its export sales to Middle East, Asian and African countries.

The average chicken meat price through the first quarter of 2013 decreased by 3% to UAH 16.33 per 1 kg of adjusted weight (excluding VAT) when compared to Q1 2012, due to the increased share of export in total poultry sales (as a result of lower price for frozen chicken (export) compared to the fresh).

Sunflower Oil Sales

Q1

Q1

%

Sunflower Oil

2013

2012

change

Sales volume, tonnes

49,310

45,558

8%

Price per 1 tonne, USD

1,149

1,085

6%

In Q1 2013, due to the increase of the production of fodder meal at the Vinnytsia complex, MHP’s sales of sunflower oil increased respectively by 8% to 49,310 tonnes compared to 45,558 tonnes in Q1 2012. In line with international trend of the commodity prices, average price per 1 tonne of sunflower oil increased by 6% to USD 1,149 compared to USD 1,085 in Q1 2012.

Grain growing operations

Almost 64,400 hectares of land are under the winter crops (winter wheat, rapeseeds, barley and rye), which are around 25% of the land cultivated in the grain growing segment of the Company. Due to the heavy snow and mild winter, all crops are in good condition. As a result, MHP expects good harvest of winter crops in 2013.

MHP’s 2013 spring sowing campaign is ongoing now.

According to the strategy and taking into account considerable land bank expansion plans, the Company is expected to increase its land bank by 70,000 hectares this year including acquisition of grain growing business in Russia.

Other agricultural operations

Q1

Q1

%

Meat processing products

2013

2012

change

Sales volume, third parties tonnes

7,340

7,500

-2%

Price per 1 kg net VAT, UAH

22.51

21.53

5%

Production volumes of sausage and cooked meat in Q1 2013 remained almost at the same level and constituted 7,340 tonnes compared to 7,500 tonnes in Q1 2012.

The average sausage and cooked meat price in Q1 2013 increased by 5% to UAH 22.51 per kg (excluding VAT) compared to UAH 21.53 in Q1 2012. MHP continues to execute its strategy of increasing the Company’s market share in meat processing products, by using internally produced chicken meat.