AVANGARDCO INVESTMENTS PUBLIC LIMITED FULL YEAR TRADING UPDATE KYIV, UKRAINE – AVANGARDCO INVESTMENTS PUBLIC LIMITED (LSE: AVGR) (“Company” or “Avangard”), the leading producer of shell eggs and egg products in Ukraine, announces its trading update for the year to 31 December 2010.
Shell Egg Segment
During 2010, Avangard’s shell egg production volume increased by 22% to 4,420 million pieces (2009: 3,634 million pieces), largely as a result of the increase in poultry stock. At the end of 2010, the Company’s total flock was 24.3 million heads, which is 51% higher than at the end of 2009 (2009: 16.1 million heads).
The average sale price in 2010 was UAH 0.57 (excluding VAT) per piece, compared to UAH 0.56 (excluding VAT) per piece in 2009. The average sale price in 2010 was lower than expected as a result of the very dry and hot summer in Ukraine that led to a decline in shell eggs demand, which in turn led to a significant decline in prices during that period. Shell egg demand in Q4 2010, however, showed good growth against the same period in 2009.
Avangard’s cost base was not materially impacted in 2010 by the high cost of grain in the Ukrainian market in 2010 caused by the reduction in grain yields following the region-wide drought. This was due to the Company’s established policy of signing forward contracts for the purchase of corn and wheat, which enabled it to secure the cost of these key raw materials at below market prices. During the reporting period the Company continued executing its strategy of focusing on the development and diversification of its customer base. As a result, the share of the Company’s sales volumes through modern retailers increased to 16% in 2010 from 2% in 2009.
During 2010, the Company has been exporting its shell eggs to Iraq, Kazakhstan, Syria, Turkey, Moldova, and United Arab Emirates.
Egg Products Segment
The average sale price for dry egg products was USD 6.83 per 1 kg. (excluding VAT), a 1% increase compared to 2009 (USD 6.76 for 1 kg., excluding VAT).
During the period the Company exported dry egg products to Jordan, Turkey, Saudi Arabia, Kuwait, UAE, Indonesia, Thailand, South Korea, Oman and Pakistan.
Avangard significantly increased its export volumes in the period, reaching the key milestone of one billion eggs and egg products in the egg equivalent, this is over a threefold increase on last year, where 306 million eggs were exported. Egg products made up the largest share of the export total due to the strong demand for these products.
Construction work at the Company’s new production facilities at Avis, in the Khmelnitsky region of Ukraine, and Chornobaivske, in the Kherson region of Ukraine, is progressing well and on schedule.
Management expects to report financial results for the full year in line with analyst expectations. The date for the Company's full year financial results will be announced in a due course.
Additional information:
Financial Dynamics London
Ben Foster
Marc Cohen
Hazel Stevenson
+44 20 7831 3113
Financial Dynamics Moscow
Leonid Solovyev
+7 495 795 06 23
For investor’s requests:
Victoria Korolchuk
Avangard
Head of Investor Relations
Telephone: +38 044 593 28 60
Mobile: +38 067 214 84 23
e-mail: v.korolchuk@avangard.co.ua