OREANDA-NEWS. July 31, 2014. Cherkizovo Group (LSE:CHE; MOEX: GCHE), Russia’s largest meat and fodder producer, announces its operational results for the first half of 2014.

Poultry Division 

Total sales in the Poultry Division for the first half of 2014 increased by 25% y-o-y to 205,775 tonnes of sellable weight, including 22,562 tonnes of sellable weight produced by LISKO Broiler since acquired by Cherkizovo Group (1H 2013: 165,114 tonnes).

The average selling price in roubles increased by 6% y-o-y from 76.62  RUB/kg in the first half of 2013 to 81.53 RUB/kg in the first half of 2014 (all prices hereinafter are net of VAT). The price in the second quarter of 2014 increased by 8% compared to the price of 77.93 RUB/kg in the first quarter of 2014.

The average selling price in dollars decreased by 6% y-o-y from USD 2.47/kg in the first half of 2013 to USD2.33/kg in the first half of 2014, due to weakening of the rouble against the USD. The price in the second quarter of 2014 increased by 8% compared to the price of USD 2.23/kg in the first quarter of 2014.

Pork Division

Sales in the Pork Division in the first half of 2014 increased by 16% y-o-y to 81,318 tonnes live weight, compared to 70,078 tonnes in the first half of 2013.

The average selling price in roubles increased by 50% y-o-y from 59.24 RUB/kg in the first half of 2013 to 88.72 RUB/kg in the first half of 2014. The price in the second quarter of 2014 increased by 41% to 103.67 RUB/kg compared to the price of 73.55 RUB/kg in the first quarter of 2014. The rapid price growth is mainly due to the import restrictions on pork in Russia.

The average selling price in dollars increased by 33% y-o-y from USD 1.91/kg in the first half of 2013 to USD 2.54/kg in the first half of 2014 (live weight). The price in the second quarter of 2014 increased by 41% compared to the price of USD 2.10/ kg in the first quarter of 2014.

Meat Processing Division 

Sales in the Meat Processing Division were almost flat at 64,033 tonnes in the first half of 2014 compared to the corresponding period of 2013 (1H 2013: 63,226 tonnes). 

The average selling price in roubles increased by 10% y-o-y from 146.08 RUB/kg in the first half of 2013 to 160.80 RUB/kg in the first half of 2014. The price in the second quarter of 2014 increased by 10% to 167.95 RUB/kg compared to the price of 152.52 RUB/kg in the first quarter of 2014.

The average selling price in dollars decreased by 2% y-o-y from USD 4.71/kg in the first half of 2013 to USD 4.60/kg in the first half of 2014. The price in the second quarter of 2014 increased by 10% compared to the price of USD 4.36/kg in the first quarter of 2014.

Grain Division 

Sales of various crops in the Grain Division doubled to 24,618 tonnes in the first half of 2014 compared to 12,149 tonnes in the first half of 2013.

The average selling price in roubles decreased by 28% y-o-y from 8.50 RUB/kg in the first half of 2013 to 6.08 RUB/kg in the first half of 2014. The price in the second quarter of 2014 decreased by 2% compared to the price of 6.10 RUB/kg in the first quarter of 2014.

The average selling price in dollars decreased by 37% y-o-y from USD 0.27/kg in the first half of 2013 to USD 0.17/kg in the first half of 2014. The price in the second quarter of 2014 was flat at USD 0.17/kg.

Cherkizovo Group began harvesting in Lipetsk, Orel, and Voronezh Regions in July. The Company increased its sown area to about 58,000 hectares in this crop season. Cherkizovo expects to harvest approximately 250,000 tonnes of grain (bunker weight) in 2014.