Zavolzhsky Engine Plant reduces net profit by 75% in Q1
NIZHNY NOVGOROD. May 10 (Interfax) - OJSC Zavolzhsky Engine Plant (ZMZ, part of the Sollers Group ) posted net profit of 13.4 million rubles in net profit in the first quarter of 2011, the company said in a statement.
The plant posted 42.139 million rubles in the first quarter of 2010. Therefore, the company's net profit decreased 74.3% in the first quarter of this year.
In addition, the company's net profit deceased in comparison with the fourth quarter by 90%. The company said that this decrease was driven by contracting results from operations, which, in turn, partially took place because of a 28.9% decrease in engine and spare part shipments owing to a corporate break in the first quarter, as well as the creation of reserves by ZMZ's industrial consumers.
In addition, an increase in insurance rates to 34% from 26% for the fourth quarter of 2010, as well as rising natural monopoly tariffs, had an effect on the enterprise's financial result.
ZMZ is one of Russia's leading engine producers. Sollers Group owns 79.32% in the company's charter capital (87.81% of its common shares).