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18:44
SUMYKHIMPROM'S WORKERS ASKING AUTHORITIES TO TAKE MEASURES FOR COMPANY TO FIGHT CRISIS

Kyiv, August 3 (Interfax-Ukraine) – The employees of OJSC Sumykhimprom, one of the leaders in the Ukrainian chemicals sector, have asked the Ukrainian authorities for help in bringing the plant and the mineral fertilizer sector as a whole out of recession, a well-informed source at the plant has told Interfax-Ukraine.

The source said that in particular, the company's employees held a rally at which an open letter to the president and the cabinet of Ukraine was made public.

Among key problems indicated in the address is a request to reimburse VAT to Sumykhimprom, and putting key types of raw materials for a certain group of mineral fertilizers on the list of critical imports.

The company's staff asked for the national budget for 2009 to be amended to grant partial subsidies for the production of phosphorus-bearing fertilizers for the sector, and foresee the allocation of concrete sums in the budget for 2010 for this purpose.

A source at the plant said that the company's employees asked for the restructuring of the company's debt for consumed gas and called for probes into imports of composite mineral fertilizers to Ukraine.

As reported, the head of Sumy regional state administration, Mykola Lavryck, said that it is necessary to introduce a temporary administration at the plant to stabilize its operations.

He said that a representative of the ministry should be posted at the plant and, jointly with the company's leadership, realize a program proposed by Sumy regional state administration.

Lavryck said that at present, UAH 11.2 million in VAT should be reimbursed to the company, while the total backlog of VAT to be reimbursed is estimated at UAH 22 million. The main part of the funds would go toward the payment of debts for natural gas.

In June 2009, the Industry Ministry proposed to create an interagency working group to draw up a plan of urgent measures on the stabilization of the financial state of Sumykhimprom.

The Regions Party earlier said that it plans to force Industry Minister Volodymyr Novitsky to resign for conducting political repression, in particular, by attempting to dismiss Sumykhimprom's board chairman, Yevhen Lapin. MPs Yuriy Boiko and Mykola Azarov from the Regions Party have submitted a draft resolution on the dismissal of Novitsky, although the draft has not been yet discussed.

Before Q4, 2008, Sumykhimprom boosted its financial indicators. In particular, in 2007 the company increased its net profit by 12.1%, to UAH 1.42 million, while its net income rose by 56.8%, to UAH 908.1 million.

In Q4, 2008, its indicators sharply deteriorated: losses came to UAH 240.1 million, and its net income shrank by 53.2%, to UAH 119.8 million.

In 2008, the plant increased its net income by 47.5%, to UAH 1.34 billion, and saw UAH 230.6 million in net losses.

In Q1, 2009 the company's net income plunged by 2.2 times, to UAH 148.4 million, while its net losses stood at UAH 100.7 million, compared to a UAH 1.2 million in net profit in Q1, 2008.

The net losses of Sumykhimprom in January to June 2009 under Ukrainian accounting standards were estimated at UAH 203.687 million, while year-over-year the company enjoyed a UAH 2.827 million profit.

Its net income in H1, 2009 totaled UAH 288.746 million, which is 2.8 times or UAH 511.59 million less year-over-year.

The net losses of the company in April to June 2009 amounted to UAH 102.97 million against UAH 1.68 million in net profit year-over-year, while its net income fell by 3.4 times or by 339.08 million, to UAH 140.36 million.

Sumykhimprom produces titanium dioxide, sulphuric acid, ferrioxide pigments, mineral fertilizers and coagulant for water treatment. The state owns a 100% stake in the company.

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