KDV Group

KDV is a Russian manufacturer of snacks, confectionery, tea, coffee, juices and other products. The head office of KDV Group for 2023 is located in Tomsk.

Aktivs

As of November 2022, the company includes 15 factories producing 700 types of products, as well as its own logistics warehouses, distribution centers and a fleet of vehicles. The company produces brands such as Yashkino, Babkin Seeds, Calve, Kiriyeshki, etc.

Performance indicators

2023: Record profit - 19.6 billion rubles

KDV JSC, the parent company of KDV Group holding, earned 19.6 billion rubles of net profit in 2023, which has never happened. Compared to 2022, profit soared four times - then it was measured at 5.1 billion rubles. Such data were released at the end of February 2024.

The revenue of the manufacturer of products under the brands "Yashkino," Calve and "Kirieshki" in 2023 was not disclosed. In 2022, it amounted to 213 billion rubles, reports Forbes.

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According to the publication, by the end of February 2024, the KDV owner is the Konderus Kom group, which also includes the Brighter! Supermarket chain, Dolinsk Bank and real estate assets in Siberia. The largest owner of Confectionery Kom is Denis Shtengelov with a share of 78.8%. Forbes estimates the fortune of this businessman at $1.3 billion.

Investment strategist of the Ari-Capital management company Sergey Suverov, in a conversation with Kommersant, said that the "impressive" financial performance of KDV is associated with food production.

In general, there was an increase in consumer sector companies. This is primarily due to pricing policy. The business raised prices, perhaps switched to the production of more marginal products. The effect of import substitution also affects: many Western brands have stopped working in Russia, and their niche is occupied by domestic structures, the expert said.

According to Ivan Fedyakov, general director of Infoline analytical company, KDV holding will now be forced to abandon business scaling, as it becomes more and more difficult to grow in the Russian food market due to intense competition.

In fact, we have a relatively small country in terms of population, and at the moment food security is already provided to the overwhelming majority, so many companies are in rather fierce competition with each other, "the expert explained.[1]

History

2021

Hit Super Pric non-food supermarket chain launch

In mid-November 2021, it became known about the creation of a network of non-food stores Hit Super Price. This is a project of the manufacturer of confectionery and snacks KDV, which produces products under the brands "Yashkino" and "Kirieshki." Read more here.

Purchase of Russian-made ketchup and Calve mayonnaise from Unilever

On October 18, 2021, a deal was announced in which Unilever sold the Calve and Baltimore brands to the Russian company KDV. The parties to the agreement did not disclose its financial component. Read more here.

2010

Purchase of dried seafood producer "Golden Tower" (brand "Barentsev")

In September 2010, KDV added Zolotoy Terem (Barentsev brand), the largest producer of dried seafood, to its assets.

The fact that Denis Shtengelov is really all-in became clear in September 2010, when KDV bought out Zolotoy Terem Group of Companies, according to estimates, for $30 million.

Back in the fall of 2008, the main owner of the Golden Tower, Mark Gusarov, solemnly opened the third, largest, production complex in his native Rzhev and promised to establish the export of snacks abroad - first to the Baltic countries, and then Scandinavia and Western Europe (see SF N46/2008). In recent years, the revenue of an ambitious company has decreased from 2.2 billion rubles. in 2007 to 1.5 billion rubles. in 2009, and creditors through the courts tried to recover more than 250 million rubles from the company. In April 2010, the Golden Tower transferred distribution to PepsiCo. On the market, this step was regarded as preparation for sale, but foreigners were in no hurry to decide, and Denis Shtengelov once again turned out to be faster: "It's like in chess: I saw a good move and made it. Why delay? "

KDV's share in the Russian snacks market is 13.2% in money

"If I had been told three years ago that we would be a big snack player, I would have been very surprised. We do not make plans for such a period, "Denis Shtengelov assured. He still does not understand how it turned out that his company absorbed federal players and became the second in the snack market. According to Nielsen data for June 2010, the share of KDV is 13.2% in monetary terms. In first place (31.6%) is Frito Lay, owned by PepsiCo.

At this time, the party in the snack market was amazing - it seems that KDV plays for whites and blacks at the same time. In the cracker segment, the company owns two leading brands - "Kiriyeshki" and "Three Crusts," in dried seafood - "Barentsev" and Beerka. And only in Crispy Potato chips occupies only 2% of the market.

How will competing brands get along in one portfolio? The company does not plan to "kill" any of them, on the contrary, they intend to develop, but precisely in the region where its position is stronger. If "Three Crusts" and "Barentsev" are well represented in the European part of Russia, then the brands of the "Siberian Coast" are beyond the Urals. For example, in Vladivostok "Kirieshki" occupy more than 90% of the market. According to Dmitry Vasiliev, this alignment is on Shtengelov's hands: "The resources that we spent on marketing and price wars with each other, the company will be able to direct to the development of brands and strengthening distribution. If Denis does not make fatal mistakes in marketing and continues to make decisions faster than foreigners, then we will see the creation of a mini-Nestle in the CIS. "

The KDV distribution network covers about 100 thousand outlets. In key regions - Moscow, Novosibirsk, Tomsk - the company sells its products to stores directly. Its own distribution network brings in 50% of revenue. The rest comes from independent partners. PepsiCo snacks are present in about 200 thousand outlets in Russia. In two or three years, Denis Shtengelov expects to catch up with the leader in retail coverage and bring his own sales to 80-90%.

Not only hypothetical "fatal mistakes in marketing" can interfere with such a scenario, but also a very real high debt burden. Over the past year and a half, according to the calculations of the Federation Council, about 3 billion rubles have been borrowed to carry out KDV transactions. And the total net profit of his companies last year could reach about 250 million rubles.

Shtengelov himself assures that the current cashflow is enough to pay off debts, and what KDV will turn into in a few years, prefers not to guess. "If you tell with a smart face how we thoughtfully and consciously consolidated the snack market, then it will be a lie," says Denis. "It all happened by accident."

Such a strategy is clearly different from the approach of multinational companies accustomed to living with five-year development plans. But for now, it allows Stengelov to be one step ahead of the competition.

Launch of the federal advertising campaign "Kirieshek"

In the summer of 2010, for the first time in its history, KDV launched the Kiriyeshek federal advertising campaign, which played up the harsh entertainment of Siberian men (playing sea battle with dynamite in an ice hole or sunbathing under a lens made of a piece of ice). "After the change of ownership of Kiriyeshka, they went all-in. The case for our agency is unprecedented: they not only approved all three videos we proposed, but also chose a long 45-second format for TV instead of the standard 30, "says Dmitry Levteev, Customer Relations Director at IQ Marketing. According to TNS Gallup Media, in June-July 2010, 4357 Kiriyeshek videos were released on television - no one advertised more of them in the snacks segment. In second place is the market leader PepsiCo with Lays chips - 2665 rollers. She advertised the "Xpycteam" crackers 1,388 times. Videos of "Vorontsov" crackers from Wrigley appeared on the air 1711 times.

2009

Siberian Coast Purchase

Two leaders have always fought for the Russian cracker market: Bridgetown Foods (brand Three Crusts) and Siberian Coast (Kiriyeshki, Kompashki, Beerka). Working progressively, KDV bought the first in 2008, and the second at the end of 2009. Siberian Coast is a much more famous brand than Yashkino, but marketing wars have weakened snack producers, which Denis Shtengelov took advantage of.

Obtaining a loan from Sberbank

The only loan for the M&A transaction, allocated by the Siberian Bank of Sberbank of the Russian Federation in 2009, was a KDV loan for 2 billion rubles. for the purchase of the Siberian Coast company. "The synergistic effect of the transaction was so good that the bank provided a loan on individual terms," Tatyana Chernikova, deputy chairman of the board of the Siberian Bank, explained at a press conference. Shtengelov makes another argument: even in a difficult 2008, he managed to pay off creditors in time, so they willingly finance KDV projects.

Former director of the Siberian Coast, Alexander Ladan, refused to discuss with the Federation Council the reasons for the sale of the asset. Most likely, the company, accustomed to working in a growing market, failed to adapt to stagnating. The profit of the Siberian Coast increased in 2009 to 156.7 million rubles. (from 40 million rubles a year earlier), however, mainly due to a reduction in commercial expenses - for advertising and distribution. According to Alexander Ageev, the company has noticeably reduced its presence in retail. Its share in the cracker market fell from 53% to 46%, revenue decreased from 5.5 billion to 3.9 billion rubles.

In the first half of 2010, Sibirsky Bereg continued to lose market share. According to Business Analytics, if in January - June 2009 the key brand of the company, Kirieshki, occupied 34% of the Russian cracker market, then in the same period of 2010 - 29%. However, now, as Denis Shtenegelov assures, the consolidation has ended, and the sales of Kirieshek have gone up.

2008

Create your own distribution network

Denis Shtengelov dismissed the headquarters of Bridgetown (management and administrative functions were transferred to employees at the head office of KDV in Tomsk), but organized a trading division in Moscow, refusing the services of local distributors. The creation of its own distribution network immediately increased the profitability of the dry business and made it possible to reduce logistics costs. If earlier the goods fell from the Vladimir factory to the shelves of Moscow stores on average during the week, now in two or three days.

Why didn't the former owners of Bridgetown take care of creating their own distribution? Dmitry Vasiliev believes that for this there should be many positions in the manufacturer's portfolio. It is economically unprofitable to carry several packages of crackers to each retail point. At KDV, the assortment was comparable to other distributors: snacks, baking "Yashkino," sweets under the brand name "Brighter!." All these products complement each other well - they have almost the same sales channels.

In addition, to create their own distribution system, free money was required, which Bridgetown no longer had at the time of sale. KDV, on the contrary, did not lack finance. If the salty snacks market in the crisis year 2009 sank, according to Nielsen, by 15%, then confectionery - by 6%, the waffle segment grew by 3% in physical terms. According to SPARK-Interfax, in 2008, the revenue of KDV Group (confectionery assets alone) amounted to 8.7 billion rubles, in 2009 - 11 billion rubles. mainly at the expense of Moscow. According to KDV itself, it now occupies 25% of the Russian waffle market. According to Business Analytics, the share of Three Crusts has grown by 2% since 2008. In the first half of 2010, it reached 19%.

Denis Shtengelov was convinced that if he had his own distribution, Dmitry Vasiliev's idea to combine snek assets until they were "piled up" by foreigners is by no means bad. In addition, during the crisis, the owners of the companies turned out to be accommodating.

Purchase of Bridgetown Foods, the leader of the Moscow cracker market

"Yashkino now has the strongest baking positions in Siberia due to the low price and wide representation in retail," said Alexander Ageev, director of corporate governance at NTS (franchisees of Pyaterochka and Paterson in the Novosibirsk Region and Altai Territory). But it turned out to be difficult to break into the European part of Russia. There were strong players, for example, the "Confectionery Association" SladKo "" (owned by the Orkla concern) and Kraft Foods. Brand "Yashkino" was unknown, distributors took it reluctantly. An unexpected maneuver helped to turn the tide of the KDV - the purchase of Bridgetown Foods, the leader of the Moscow market, however, not by waffles, but by crackers.

Dmitry Vasiliev, who until 2008 was the general director and co-owner of Bridgetown Foods, had the idea of ​ ​ a fix - to organize the merger of several domestic snack producers. "I've spoken to almost all of our players that it's impossible to build a big business alone. While we are fighting here, the Western coarse will come and he will kick us like a mouse, "Vasiliev recalls. There were enough reasons for pessimism.

In the early and mid-2000s, the market for national snacks, which are popular in Russia, but are poorly represented abroad (crackers, seeds, salted fish, etc.), was a real klondike. He added 20-30% annually. However, then international giants came here, before that they were engaged in chips. In 2006, crackers began to be released by PepsiCo (Xpycteam brand), in 2007 - Wrigley (Vorontsovsky). The market has reached saturation. In 2007, according to Euromonitor, sales of crackers decreased by 10% in physical terms.

Domestic companies expanded production facilities, and worked at a minimum margin. According to Vasiliev, Bridgetown sold crackers to distributors with a mark-up of only 20% - less than distributors did. They added about 25% to the price. Falling demand caught the company off guard. According to SPARK-Interfax, if in 2005 Bridgetown Foods earned 89 million rubles. net profit, then in 2007 - only 1.5 million rubles. There is no money left for development and competition with foreigners.

Denis Shtengelov learned about the problems of Bridgetown by chance: the chief financial officer left KDV there. He also introduced Shtengelov and Vasiliev, who was looking for a buyer for the asset, including negotiating with foreign corporations. "Denis knows how to make decisions very quickly. Like a Russian merchant: they hit their hands - and forward, "says Vasiliev. He does not name the amount of the transaction. In return, Shtengelov received a factory in Vladimir and Three Crusts, a brand that would help promote Yashkino to the shelves of metropolitan stores, and if costs were optimized, it itself would bring good profits.

In 2004, Sibirsky Bereg held an advertising campaign in the Moscow metro and at public transport stops under the slogan "Real crackers will not be called crust." Representatives of Bridgetown Foods then turned to the FAS and achieved that in 2006 the Siberian company was fined 200 thousand rubles, and also forced to place a refutation on the same carriers, however, rather ironic: "Real crackers can be called crusts."

Microsoft Axapta ERP system

In 2008, the Microsoft Axapta ERP system was introduced at the enterprises controlled by KDV. Orders from sales representatives come online, and the factories do not work in the warehouse, but for real demand. At the same time, production facilities are 80% loaded.

2000: Second Factory Purchase Due to Rising Demand

In 2000, KDV bought a second factory, since production in Yashkino could not cope with demand, and four years later the holding already had five factories: in addition to Yashkino, in Kemerovo, Nizhny Tagil, Minusinsk and Abakan. The assets were inexpensive. "They had no brands or built distribution - nothing. Only iron and people, - said Denis Shtengelov. "We came and just built these plants into our sales system." Then modern equipment was installed at the factories and, in parallel with local brands, waffles under the Yashkino brand began to be produced.

1998: Purchase for 2 million DM of the Austrian waffle line

In 1998, the company expanded its range by buying an Austrian waffle line for 2 million German marks. The "Soviet" waffles that our competitors produced were tasteless, and imported ones cost more, "said Denis Shtengelov.

1997: Buying a factory in the village of Yashkino

Up on their feet, recent students have turned to a more solid clientele. In the spring, they paid for the work of agricultural enterprises, in the fall they took seeds from them and brought oil to producers, which they, in turn, resold to confectioners. So entrepreneurs first got to a small confectionery factory in the village of Yashkino, in the neighboring Kemerovo region.

The company, which had survived from Soviet times, then produced about 15 tons of cookies per month with a capacity of 500 tons and barely made ends meet. It was owned by a large Kuzbass holding, for which the confectionery business was non-core. In 1997, KDV bought out this asset. "The management of the factory is good people, production workers, but they could not attract buyers," said Denis Shtengelov.

Confectioners, as a rule, shipped products only from the factory and on a prepaid basis. In addition to Kemerovo and Tomsk, KDV immediately went to neighboring regions (Novosibirsk and Omsk), where it rented small warehouses, and offered local distributors to pay for cookies based on sales results. "One client, as a rule, disappeared without paying off, two or three sold poorly, three or four sold quickly," recalls Shtengelov.

1994: Small wholesale trade in raw seeds

Denis Shtengelov took the first step from Tomsk to Moscow in 1994, when he graduated from the economics department of Tomsk State University and, together with his classmates, took up the small wholesale trade in raw seeds. The main clients were grandmothers, who then fried seeds and sold throughout the city.

Notes