Kazanorgsintez net profits surge 70% in Q1
KAZAN. May 23 (Interfax) - OJSC Kazanorgsintez saw its net profits grow 70% year-on-year to 911.58 million rubles in the first quarter, company General Director Leonid Alekhin said in an interview given to Interfax.
Sales revenues were up 24% at 11.62 billion rubles.
Alekhin said the increases were associated with additional deliveries of ethane from Orenburg Gas Refinery. "Raw material is the main thing for us. In the first quarter, we definitely showed how Orgsintez can work given the availability of raw material resources," he said.
The company's business plan for this year targets 42 billion rubles in sales revenues and 2.4 billion rubles in net profits. Investment in extant production will be flat with last year at around 1.6 billion rubles.
Kazanorgsintez made sales revenues of 37.021 billion rubles and net profits of 437.3 million rubles in 2011. Alekhin said the company settled all its debts last year, not counting bank credits. The company put 800 million rubles towards the early pay-back of a Sberbank of Russia credit in Q1, he said. The company now owes Sberbank 24.992 billion rubles at 8.5% interest per annum.
Kazanorgsintez is once again operating in conditions of limited resources, Alekhin said. "Under a contract with Gazprom , deliveries of 292,000 tonnes of ethane a year are being fulfilled. Today it is delivering even a little more due to an increase in processing at Orenburg Gas Refinery," he said. However, problems have cropped up at Tatneft with an installation that was to increase ethane production 50%. "They launched it, expanded production, but in two months they stopped working at full capacity. It didn't work. Tatneft management has taken this problem on. They plan to resolve it this year," he said.
Ethylene deliveries from Nizhnekamskneftekhim have also declined. Last year, Kazanorgsintez received 164,000 tonnes of ethylene instead of the 180,000 tonnes it wanted. "For the first four months of 2012, we had a shortfall of 4,500 tonnes, and that its 4,500 tonnes of polyethylene. But Nizhnekamskneftekhim delivered the ethylene shortfall to us in their time. Now they are moving to the designed capacity of their own production and, correspondingly, have loaded it with raw material. I have no claims against them," he said.
