Cherkizovo Group

Aktivs

Cherkizovo Group is a vertically integrated agro-industrial company with a full production and sales cycle covering all parts of the agricultural chain - from the production of feed to the production of meat products and its sale.

As of October 2022, Cherkizovo Group combines 11 poultry complexes, 16 pig farms, 11 meat processing enterprises, as well as 9 feed mills and 300 thousand hectares of agricultural land.

Performance indicators

2023

Revenue growth by 23% to RUB 226.71 billion

In mid-February 2024, Cherkizovo Group published the results of operations under international financial reporting standards (IFRS) for 2023. According to the results of this 12-month period, the company earned 226.71 billion rubles in revenue, which is 23% more than a year earlier. The net profit of one of the largest meat producers in the Russian Federation during this time more than doubled and reached 33 billion rubles. Gross profit of the group amounted to 73.35 billion rubles (+ 74.29%).

According to the report, revenue from Cherkizovo's internal operations in 2023 increased to 204.3 billion rubles from 166.3 billion rubles a year earlier, and from exports to 22 billion rubles from 18 billion rubles. Adjusted EBITDA amounted to 49.96 billion rubles, gross profit - 73.4 billion rubles, operating profit - 40.4 billion rubles. At the end of 2023, the amount of loans and borrowings of the company amounted to 137 billion rubles.

The Group also reports that the revenue of the chicken meat segment increased to 142.2 billion rubles from 109.6 billion rubles a year ago, pork production - to 42.99 billion rubles from 35.4 billion rubles, meat processing - to 43 billion rubles from 36.6 billion rubles, crop production - to 15.5 billion rubles from 11.5 billion rubles, respectively. At the same time, revenues from the production of turkey meat in 2023 decreased to 11.5 billion rubles from 15.8 billion rubles in 2022.

Cherkizovo is one of the largest producers of poultry, pork and other meat products in Russia. By the end of December 2023, the group includes 14 poultry complexes, 20 pig farms, 14 meat processing enterprises, as well as more than 300 thousand hectares of agricultural land. The group also has two turkey meat production enterprises, 40 warehouse complexes and one oil extraction plant.^[1]

Export increase by 15%

The largest producer of meat products in Russia Cherkizovo in 2023 increased exports in monetary terms by 15% compared to 2022. The press service of the company announced this at the end of January 2024.

The group did not name the absolute value of export revenues in 2023 and only led the volume of supplies in physical terms - more than 110 thousand tons. Cherkizovo noted that the growth of foreign supplies is mainly due to the expansion of the company's presence in the EAEU countries. The bulk of exports in 2023, as in previous years, fell on chicken meat - more than 80 thousand tons.

Cherkizovo in 2023 increased exports in monetary terms by 15%

Export of chicken meat in 2023 increased at Cherkizovo by 8% due mainly to the development of exports to the EAEU countries - the volume of shipments there increased by more than 30%. The CIS countries accounted for more than 50% of the total export of chicken. Thus, shipments to Uzbekistan more than doubled.

In 2023, the Cherkizovo Group significantly increased pork exports to certain neighboring countries: for example, its supplies to Belarus and Armenia almost 5 times exceeded the volumes of 2022. Foreign shipments of turkey increased most significantly to Kazakhstan and Azerbaijan - 5 times and 2 times, respectively.

The main export markets for the Cherkizovo Group are still China, Kazakhstan and other EAEU countries. Also, the Middle East region is a priority area for the development of the company's exports, the company said in a statement.

According to Elena Volgusheva, Export Director of Cherkizovo TD, in 2023 the group increased its customer base in Southeast Asia, as well as the CIS countries. The company also managed to significantly increase distribution in the network channel, developing the brands Cherkizovo, Latifa, Pava-Pava and Dajajti, she added.^[2]

2022

Increase in revenue by 15% to 184.3 billion rubles

At the end of 2022, the Cherkizovo group raised 184.3 billion rubles against 160.2 billion rubles a year earlier. The sales indicator for 2021 was revised. Earlier it was reported about 158 billion rubles. Thus, revenue growth in 2022 amounted to 15%, Interfax reported on February 27, 2023, citing the company's reports.

Cherkizovo's net profit in 2022 decreased to 14.6 billion rubles from 16.9 billion rubles in 2021. Adjusted EBITDA fell to 30.16 billion rubles from 29.28 billion rubles. The reason for the fall in profit was an increase in cost of sales by 16% and commercial, general and administrative expenses by 23.7%.

Cherkizovo's revenue from internal operations increased to 166.3 billion rubles from 147.4 billion rubles a year earlier, from exports - to 18 billion rubles from 12.8 billion rubles, respectively.

According to Cherkizovo's materials, in 2022 pork production (live weight) amounted to 254 thousand tons against 240 thousand tons in 2021, chicken (slaughter weight) - 736 thousand tons against 710 thousand tons, turkey (slaughter weight) - 100 thousand tons.

In 2022, the group collected 219 thousand tons of spring wheat (198 thousand tons in 2021), 254 thousand tons - winter wheat (145 thousand tons), 141 thousand tons of corn (122 thousand tons), 147 thousand tons of soybeans (114 thousand tons), 44 thousand tons of sunflower (57 thousand tons).

By the end of 2022, Cherkizovo Group of Companies united 16 poultry complexes, 20 pig farms, 14 meat processing enterprises, as well as 12 feed mills and about 300 thousand hectares of agricultural land.

The group's net debt by the end of 2022 amounted to 96.2 billion rubles, which is 25.2% more than a year earlier.^[3]

Export increase by 25%

In 2022, Cherkizovo Group exported more than 100 thousand tons of products, which is 25% more than a year earlier. The agricultural holding published such data on January 23, 2023.

It is reported that a significant part of the company's exports, as in previous years, fell on chicken meat - about 75 thousand tons. Foreign supplies of chicken meat in 2022 increased by more than 20%.

The most noticeable growth in export sales in 2022 was noted in the segment of sausages and turkey meat products: in each of the categories, the volume of shipments approached 10 thousand tons, increasing by about a third compared to 2021. Pork supplies to foreign markets amounted to about 15 thousand tons (+ 15%). The increase in the share of high value-added products in the export portfolio (primarily in the sausage category) allowed Cherkizovo to ensure export revenue growth of more than 40% in 2022, the group said.

The main share of Cherkizovo's exports falls on China, Kazakhstan and other countries of the Eurasian Economic Union (EAEU), as well as Saudi Arabia and Vietnam. During 2022, the company increased the number of buyers by expanding its customer base in countries and entering new markets - Qatar, Angola, etc. Cherkizovo is increasing its export of halal products to countries with a Muslim consumption culture: its share in foreign shipments exceeded 10% in physical terms and has prospects for a significant increase.

China, the EAEU and Saudi Arabia will continue to be the main export destinations for the Cherkizovo group in the coming years. At the same time, the company sets the task of further diversifying the geography of exports and carrying out sustainable shipments to the countries of the Persian Gulf, Africa and Southeast Asia. In particular, we are interested in opening access to the markets of the Philippines, Malaysia, Indonesia and other countries, - comments Elena Volgusheva, Export Director of Cherkizovo TD.[4]

2021: Revenue - 158 billion rubles

The revenue of the Cherkizovo group in 2021 amounted to 158 billion rubles against 128.8 billion rubles in 2020. In the first half of 2022, it reached 88.9 billion rubles, which is 20.1% more than a year earlier.^[5]

Information Technology in GC

Main article: Information technologies at Cherkizovo Group of Companies.

History

2023: TAdviser interview with Head of Development Kirill Bukin

Kirill Bukin, head of development at Cherkizovo Group, spoke about migration to the platform from PIX Robotics, the choice of software robots and trends in the RPA market in May 2023 in an interview with TAdviser. Read more here.

2022: Buying fast food chain Sibylla

On May 16, 2022, the Cherkizovo group announced the purchase of the Sibylla fast food business from the Finnish company Atria. The deal included contracts for the supply of products to 4.4 thousand fast food outlets in Russia and the CIS countries, as well as equipment and recipes. Read more here.

2021: Purchase of turkey producer Krasnobor for 1.9 billion

Cherkizovo bought the turkey producer Krasnobor for 1.9 billion rubles. The companies announced this on December 27, 2021. Read more here.

2017: Assets

At the end of 2017, the Cherkizovo Group consisted of:

• 8 full-cycle poultry complexes with a total capacity of about 550 thousand tons of live weight per year,
• 15 modern pig farms with a total capacity of 200 thousand tons in live weight per year,
• 6 meat processing enterprises with a total capacity of over 218 thousand tons per year,
• 9 feed mills with a total capacity of about 2.5 million tons per year,
• elevators with a capacity of over 850 thousand tons of one-time storage and more than 140 thousand hectares of agricultural land.

Cherkizovo Group has demonstrated long-term sustainable growth in sales and profit due to its vertically integrated structure, including grain cultivation, elevator storage, in-house feed production, animal breeding, rearing and slaughter, as well as meat processing and in-house distribution.

2016

Consolidated revenue - 82.4 billion rubles

The company's consolidated revenue in 2016 reached 82.4 billion rubles.

Entry into foreign markets

In 2016, Cherkizovo Group entered foreign markets.

In 2016, Cherkizovo Group produced and sold more than 900,000 tonnes of meat products.

2015: First phase of the Tambov turkey project

In 2015, Cherkizovo Group opened the first stage of the Tambov Turkey project

The company's elevator capacity for one-time grain storage approached 1 million tons.

2014: Voronezh company Lisko-Broiler acquired

In 2014, the Voronezh company Lisko-Broiler was acquired.

2013: Dankovsky meat processing plant acquired in Lipetsk region

In 2013, the Dankovsky meat processing plant in the Lipetsk region was acquired.

Pig farms in Voronezh, Lipetsk and Tambov regions have been brought to full capacity.  Projects to double capacity in the Bryansk and Penza poultry blocks have been completed. 

2012

Work in three production segments

In 2012, the company's activities included 3 main production segments:

• Meat processing: 7 meat processing enterprises producing sausages, ham, meat semi-finished products and other meat products, as well as trading companies;
• Poultry: 7 poultry complexes for the production and processing of poultry meat, 2 feed mills, as well as trading houses;
• Pig industry: 10 pig farms and 2 feed mills.

In 2012, a selection and genetic pig complex was acquired.

The Cherkizovo Group is currently engaged in the production of feed - its own capacities allow the production of more than 90% of the required feed, as well as the distribution of products - the large-scale distribution network created provides delivery throughout Russia.

Cherkizovo Group's brand portfolio includes meat products of leading brands. Among the brands are such well-known brands as Petelinka, Kurinoe Tsarstvo, Cherkizovsky, Five Stars, Mosselprom.

In 2012, the Crop Production Division was formed. Agricultural land was acquired in the Central Chernozem region.

Joint venture with Spanish GrupoFuertes to produce turkey meat

In 2012, it announced the creation of a joint venture with the Spanish GrupoFuertes for the production of turkey meat. 

2011: Purchase of 100% Mosselprom for $252.9 million

In May 2011, Cherkizovo completed the acquisition of 100% of Mosselprom, a company specializing in the production of poultry products. The purchase of the company, which owned four poultry farms, three incubators, three slaughterhouses, cost Cherkizovo $252.9 million, of which $183.8 million was Mosselprom's debt. Part of the transaction was paid for by shares of Cherkizovo itself.

For the first time, more than a million pigs were raised at the company's pig farms.

2010: Purchase of pig farms, meat processing plant and poultry farm

In 2010, pig farms were acquired in the Lipetsk and Penza regions, the Domestic Product meat processing plant in the Kaliningrad region and the Zarechnaya poultry farm in the Penza region.

2008: A large poultry site Vertunovka acquired

In 2008, a large poultry site "Vertunovka" was acquired in the Penza region.  The first stages of modern pig farms in the Central Black Earth region have been launched.  The Lev-Tolstovsky feed mill began work.

2007: Chicken Kingdom Acquired

The company "Chicken Kingdom" was acquired - a large poultry producer with assets in the Bryansk and Penza regions.

2006: Placement of shares on the Moscow and London stock exchanges

Cherkizovo Group successfully conducted an initial offering of shares on the Moscow and London stock exchanges.

2005: Association of agro-industrial complex Cherkizovsky and agro-industrial complex Mikhailovsky. Creation of Cherkizovo Group

OJSC Cherkizovo Group was established in 2005, combining as a management company in a single holding two groups of enterprises created by Igor Babaev - Agro-Industrial Complex Cherkizovsky and Agro-Industrial Complex Mikhailovsky.

1974: Cherkizovsky Meat Processing Plant opened in Moscow

In 1974, the Cherkizovsky Meat Processing Plant (ChMPZ) was opened in Moscow.

Notes