Business
TRADING UPDATE
TRADING UPDATE.
About this update from Ukrproduct Group Ltd
[{"type":"text","content":"\n \nRNS Number : 0353M Ukrproduct Group Ltd 15 January 2016 \n\n \n \nFOR IMMEDIATE RELEASE January 15, 2016\n \nTRADING UPDATE\n \nKyiv, Ukraine - 15 January 2016 - Ukrproduct Group Limited (\"Ukrproduct\" or the \"Group\") (AIM: UKR), one of the leading Ukrainian producers and distributors of branded dairy foods and beverages (kvass), today announces a trading update as the 2015 trading period drew to a close. The full year financial results are expected to be released in the second quarter of 2016.\nOver the year Ukrproduct faced significant headwinds. The Ukrainian economy continued under pressure accentuated by the unrest in the East of the country. This has reflected in the major devaluation of its currency, deterioration of consumer confidence and geographic contraction of the available market. Closure of the Russian market further intensified the local competition.\nTrading - Whilst revenues in hryvnia terms grew, the overall gross profit in dairy products suffered a significant downturn. This was caused by the rising prices of raw materials including the raw milk and imported components. The compensating pricing was difficult and reduced demand further. In addition, volumes contracted as the Company has sought to manage its counterparty risk by stopping selling to customers with weak credit ratings.\nRevenue growth in hryvnia terms resulted from increased sales of packaged butter, hard cheese and third party orders, in particular a 25% increase in skimmed milk powder sales. Other product lines such as processed cheese, processed cheese product and bulk and packaged spreads were marginally down on the previous period. Sales and profitability of the beverage, Kvass, grew marginally, this was achieved by adjusting the sales mix. Kvass production is becoming increasingly important for the company business going forward.\nThe e...