«Renaissance Capital Group»

«Renaissance Capital Group»

Results of Zhytomyr confectionery "ZhL" in 2012

In 2012 Zhytomyr confectionery factory "ZhL" sold its products for more than 900 million UAH (preliminary results), which is 1.6% more than in 2011.
Currently, the share of the confectionery factory "ZhL" in the total production of confectionery products in Ukraine is over 4%. Zhytomyr enterprise is one of the constant "sweet" leaders in the confectionery market of Ukraine.
The share of exports in total sales for 2012 was more than 31%. There was a significant increase in sales of "ZhL" in foreign countries, which certainly is related to the discovery and development of new markets and strengthening of positions in markets where "ZhL" products have been represented for many years.
For example, in the summer of 2012 a trading house was opened in Moscow, which allowed the company to expand the geography of sales and to supply its products within almost entire territory of the Russian Federation, in particular in the Central and Northwest Federal districts.
In December 2012 a contract was signed with a company from New Zealand to supply a wide product range of confectionery "ZhL" to this new market.
An important achievement of the past year is getting a "Halal" certificate, which allows the factory to export products to Muslim countries.

Investment projects and modernization of factory
In 2012 the factory installed a new line which manufactures an innovative product on the market of Ukraine - "Fudge." The line was equipped with parts manufactured in the Netherlands, Germany, Italy and Ukraine and was established by professionals from the Netherlands. All processes of manufacturing sweets, from preparing the masses to packaging, are completely automated.
Apart from installing production line for fudge "Milk jug", the process of installation a new more productive section - extruder was completed and transportation system in a production shop was modernized on the existing production line of sugar cookies.
This equipment was manufactured and delivered by one of the leading Italian companies producing equipment for the confectionery industry. The installation was conducted by Ukrainian specialists led by a representative of the Italian company.
The introduction of such technical component as an extruder can expand our range of products that are produced on this line, and improved transportation system greatly protects products when moving to production floor.
As a result, the factory can produce new kinds of cookies, which are very popular in Europe and gain the market of Ukraine: oatmeal cookies with added peanuts, raisins and chocolate drops, dome-shape butter cookies with fruit and chocolate filling, butter cookies without filling, pastries like famous Italian "Grancereale".
Moreover, the distribution system was modernized in Ukraine. An extensive motivation program for exclusive sales teams was carried out. Flagship stores were opened, including the opening of candy boutique «Doma» in downtown Kyiv at the end of the year.

Plans for 2013
In 2013, there are plans to increase sales to 1.2 billion UAH. 15 million euro will be invested in increasing production and sales. About 5 million of that amount will be invested in equipment. In particular, the company has purchased new line of sweets, with a capacity of 600 tons per month, installation is scheduled for the I quarter of 2013. In addition, "ZhL" plans to use two lines, which were acquired in 2012, at their maximum capacity.
About 10 million will be channeled into sales technology improvement, namely the work of sales networks, strengthening of sales structure, increased sales staff, merchandising and promotion service development, etc.
Moreover, the confectionery factory in 2013 intends to increase the share of its exports in total sales to 42%. In order to expand the geography of export, the company management is in talks with China and African countries.

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