Ilim Group

Ilim Group is the leader of the Russian pulp and paper industry in terms of output.

Ilim Group's headquarters are located in St. Petersburg.

For 2018, Ilim's structure includes 4 representative offices, 3 of them are located in Russia, and one more in China, since China has been the largest export market for the company's products for many years.

Performance indicators

2023: Revenue growth by 0.7% to RUB 184.9 billion

According to the results of 2023, the largest Russian pulp and paper company Ilim earned 184.9 billion rubles in revenue against 183.7 billion rubles a year earlier (an increase of 0.7%). At the same time, the group's net profit decreased - from 21.8 billion rubles in 2022 to 17.4 billion rubles a year later. Such data are provided in the reporting under RAS, which was disclosed in April 2024.

According to Interfax, citing Ilim materials, in 2023 the group's cost of sales reached 105.3 billion rubles against 101.9 billion rubles a year earlier (an increase of 3.3%). Gross profit in comparison with the same segments of time decreased from 81.8 billion to 79.6 billion rubles (-2.6%). Profit before tax at the end of 2023 turned out to be equal to 23.2 billion rubles, which is 16.6% less than profit a year ago at 27.8 billion rubles.

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Ilim reports also show that as of December 31, 2023, the Group's short-term payables were measured at RUB 35.8 billion (down by a third compared to 2022), total short-term loan liabilities at RUB 119.7 billion (up more than 2 times), and long-term liabilities at RUB 111 billion (down 7.2%). Of the short-term obligations, 94 billion rubles in 2023 fell on ruble debt, 25 billion rubles - on yuan.

During 2023, Ilim enterprises produced about 3.63 million tons of finished products. By the end of 2024, the group plans to increase production to 4.3 million tons thanks to the launch of a new pulp and cardboard mill in Ust-Ilimsk.

About 70% of Ilim's products in 2023 were exported, and about half of the goods are sold on the Chinese market.

By the end of 2023, Ilim includes three pulp and paper mills: in the Arkhangelsk aya (Koryazhma) and Irkutsk (Bratsk and Ust-Ilimsk) regions, as well as corrugated board factories in the Leningrad and Moscow regions.^[1]

History

2024: Pulp and cardboard mill launched for $ ₽100 billion

On October 10, 2024, it became known that in Ust-Ilimsk, Irkutsk Region, the official launch of a new pulp and cardboard mill (CCC) took place, investments in which amounted to about ₽100 billion. The project was implemented by the Ilim group and has become one of the largest in the timber industry in Russia in recent years. Read more here

2023

Appointment of Alexey Lomko as CEO

At the end of October 2023, Alexey Lomko was appointed General Director of the Timber Industry Group. " Ilim Prior to that, he worked for the company as a senior vice president of the company for legal affairs. here More.

American International Paper sells 50% of the company to Russian partners for $484 million

The AmericanInternational Paper, the largest foreign investor in the forest industry, in Russia January 2023 announced that it would sell 50% in the Ilim group to Russian partners for $484 million. International Paper acquired this stake more than 15 years ago for $650 million. More. here

2018

Bratsk, Koryazhma and Ust-Ilimsk Pulp and Paper Mill are part of Ilim

In 2018, Zakhar Smushkin's company includes 3 pulp and paper mills: in Bratsk, Koryazhma and Ust-Ilimsk, as well as two corrugated factories: in Kommunar and Dmitrov. Russia Ilim is a key company in the timber industry as it produces 75% of commercial pulp, 20% of cardboard and 10% of paper produced in the Russian Federation. Ilim's total production exceeds 3 million tonnes annually.

17 thousand employees

In 2018, Ilim employs more than 17,000 people. The company's management actively invests in corporate programs to improve the safety of working conditions, as well as modernizes production equipment in a timely manner. All Ilim companies have also been certified to comply with the international health and safety system.

Zakhar Smushkin's company attracts trainers to train employees in special centers in order to improve safety at work. Ilim has several corporate programs aimed at reducing the number of dangerous situations. Among them are, for example, such as "Volunteer rescuers," aimed at improving the safety culture, as well as "Take care of life" - to eliminate the risk of injury.

2012: 20,000 employees

For 2012, enterprises located in the Leningrad, Arkhangelsk and Irkutsk regions are key in the Russian timber industry: they produce over 65% of all Russian commercial pulp and more than 25% of cardboard. The total annual production of pulp and paper products in the company exceeds 2.5 million tons.

Ilim employs more than 20,000 people.

Ilim's strategy is to move from semi-finished products to high value-added advanced processing products - paper and packaging.

2007: Transition of Zakhar Smushkin to the position of Chairman of the Board of Directors of Ilim Group

In 2007, the company was restructured in order to improve the management quality of a large number of Ilim companies. In addition to changing the internal structure, the form of ownership and the name - Ilim Group JSC has also changed. It was at this time that Zakhar Smushkin changed his position to chairman of the board of directors, which he currently holds.

In 2009, the production of neutral-sulfite cellulose was opened in Koryazhma. For 2018, this is the largest enterprise in the world engaged in the production of this type of product.

2006: Announcement of sale of 50% of Ilim Holding to US International Paper

At the end of October 2006, it was announced that an agreement was signed that 50% of the Swiss-registered Ilim Holding, which owned more than 75% plus 1 share of Ilim Palpa's pulp and paper assets, would be sold to the American timber company International Paper. At the same time, Ilim Palpa's timber processing assets were not included in the transaction. Later, in 2007, Ilim's timber processing assets were separated into a separate company Ilim Timber Industry.

1992: Founding of Ilim Palm Enterprise by Zakhar Smushkin with the Zingarevich brothers and Dmitry Medvedev

Work in a large international company gave Zakhar Smushkin the opportunity to further study the features of the forest industry, and he decided to establish his own business. The company was incorporated on April 30, 1992 and was named Ilim Palm Enterprise, and Zakhar Smushkin took over as CEO.

The co-founders of ZAO Finzell, which established ZAO Ilim Palm Enterprise, included Dmitry Medvedev, later President of the Russian Federation, in addition to Zakhar Davidovich Smushkin, Boris and Mikhail Zingarevich. At the same time, in ZAO Finzell Medvedev owned 50%, and in Ilim Palm Enterprise - 20%.

At the very beginning of its existence, Ilim functioned as an exporter of pulp and paper products in small volumes. However, soon Smushkin decided to develop the company as a manufacturer. And already in the first few years of operation, large deals were concluded, which became key to the rapid growth of the company. So, in 1995, the Kotlas Pulp and Paper Mill was attached to Ilim, in 1997 - the Bratsk LPK, and in 2002 - the Ust-Ilim LPK.

Another important feature that allowed Ilim to develop rapidly was its innovative management. The enterprises that were part of Ilim were located in different parts of the country, but at the same time they were managed centrally. Vertical integration management technology helps to carry out this management. It was Zakhar Smushkin who was the first in Russia to use it at his enterprises. In addition, vertical integration allows you to control all stages of the production cycle - from resource production to the delivery of finished products to the end user.

As a result of such effective management, a large number of enterprises were able to carry out coordinated work, actively increase financial and technical equipment indicators. The above factors played an important role in the development of Ilim. Zakhar Smushkin's company already in the late 1990s became the leader in terms of product production, and also began to develop international markets. Thus, the first representative office of the company abroad was opened in 1996 in the city of Shenyang of the People's Republic of China.

And already in 2003, Ilim switched from the geographical principle to the management of the business line system. In the same year, IlimSeverLes was created on the basis of the Kotlas Pulp and Paper Mill, which united 12 logging enterprises in the Arkhangelsk Region and the Komi Republic. Also in 2003, Ilim Gofropak was opened for the production of corrugated packaging.

Charity

In 2005, the company's management established the Ilim-Garant Foundation, which implements charitable projects. In total, the company has already independently implemented more than 200 projects. In 2016, the management of Ilim allocated more than 312 million rubles for the implementation of charitable and social programs.

Environmental Policy

Ilim Group JSC is the largest Russian company in the forestry industry, and therefore management carefully monitors compliance with various environmental standards - both local and international.

On February 1, 2012, Ilim Group and the World Wildlife Fund (WWF) entered into an agreement on the conservation of forests in the Arkhangelsk Region. According to him, Ilim Group voluntarily undertook to abandon timber harvesting in a unique forest massif, which has practically no analogues in Europe.

OJSC Ilim Group"" voluntarily refuses to harvest wood within the previously agreed boundaries in the Verkhnevashkinsky forest in the south of the Arkhangelsk region. Currently, OJSC Ilim Group"" leases forests in this massif. A moratorium on felling was introduced until the end of the company's lease of these forest plots.

The company was awarded the Ministry of Natural Resources in 2017 for its active environmental policy. The award ceremony was held as part of the fifth All-Russian Congress of Environmental Protection and the second international exhibition "ECOTECH."

Ilim's business strategy takes into account the reduction of environmental risks, the rational use of environmental resources and the use of modern technologies. The company's management has also formed its own principles in work that contribute to the protection of the environment. Each year, all Ilim enterprises implement individually developed targeted programs that are also aimed at nature protection.

In addition, according to WWF, Ilim Group leads the list of companies undergoing voluntary forest certification in Russia. More than 90% of the territories that the company leases for its work have been certified to international standards. Ilim annually performs reforestation work in an area exceeding 40,000 hectares.

In 2016-2017, Ilim allocated more than 3 billion rubles for the implementation of environmental protection measures.

Another principle that is carefully followed by the company's management is transparency. Every year all Ilim companies publish information on the environmental impact resulting from production processes. Such reports of the enterprise are sent to Rosprirodnadzor, Rospotrebnadzor and Rosstat. In addition, Ilim takes part in the preparation of environmental collections in the Arkhangelsk and Irkutsk regions.

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