Asset growth despite pandemic: NKNH sums up the results of 2020 by IFRSs
Nizhnekamskneftekhim PJSC has published its consolidated financial statements in accordance with the IFRSs for the past year
The spread of the new coronavirus had a significant impact on the financial performance of Nizhnekamskneftekhim Group. Many countries around the world have been quarantined, and the restrictions have had a negative impact on economic growth and demand, and as a result, on the Group's economic results. Read the details in the material of Realnoe Vremya.
The Group's revenue amounted to about 154 billion rubles
According to the published data, the revenue of Nizhnekamskneftekhim Group in 2020 amounted to 153,989 billion rubles, which is by 24,981 billion rubles less than in 2019. Gross profit in 2020 decreased by 7,324 billion rubles and amounted to 36,132 billion rubles.
Profit in 2020 amounted to 9 billion rubles, which is by 15 billion rubles less than in 2019 (24 billion rubles).
At the same time, it should be noted that the Group's assets increased by 53 billion rubles and amounted to 268,6 billion rubles — against 215,2 billion rubles as of 31 December 2019. The main growth, according to the reports, was due to an increase in the item 'Fixed Assets', as Nizhnekamskneftekhim PJSC continues to implement a large-scale strategic development programme.
Sales of rubbers of the Group in 2020 decreased by 15 billion rubles
A serious collapse in prices for all types of products as a result of both a decline in quotations and a significant reduction in demand due to the closure of many production facilities abroad significantly affected the financial and economic performance of the company.
For example, in 2020, revenue from the sale of products amounted to 146,2 billion rubles against 171,8 billion rubles in 2019. Out of this volume, products worth 80,1 billion rubles were sold to the domestic market, which is also less than in 2019. For export, finished products were sold in the amount of 73,7 billion rubles (in 2019 — 88,1 billion rubles). The group mainly exports its products to Europe, Asia, etc.
Revenue from the sale of synthetic rubbers in 2020 decreased by almost 15 billion rubles and amounted to 57,6 billion rubles — against 72,3 billion rubles in 2019. The sales of plastics, compared to 2019, decreased by 4,4 billion rubles and amounted to 49,5 billion rubles.
The sales of other petrochemical products, including sales of glycols, polyesters, surfactants, monomers and others, amounted to 36,9 billion rubles, in 2019 — 44 billion rubles. Revenue from the sale of other products amounted to 2,3 billion rubles against 1,6 billion rubles in 2019.
The lifting of restrictive measures in the middle of the year, as well as the recovery of prices for the company's finished products in the fourth quarter of 2020, gave the opportunity to gradually begin to restore production and sales volumes in physical and value terms to the indicators of previous periods.
Implementation of large-scale investment projects is ahead
The growing financial burden associated with the implementation of large-scale investment programmes also affected the company's economic performance. In 2020, there was a significant weakening of the national currency against the US dollar and the euro. Taking into account the revaluation of credit obligations, the debt on long-term loans and borrowings increased from 49,7 billion rubles in 2019 to 97,1 billion rubles at the end of 2020.
In order to minimise losses, the flagship of the Tatarstan petrochemical industry made enormous efforts to withdraw the company from the current situation. The company's management promptly took all necessary measures to ensure the sustainability of the Group's operations, and to protect the safety and health of employees from the spread of COVID-19 infection. As a result, it was possible to avoid downtime of production and layoffs, the company reports.
Despite that the situation in the global economy remains difficult, the Group continues to implement the large-scale investment programme, the main projects of which are the construction of the olefin complex, its own CCGT-TPP, as well as the commissioning of the fifth-generation divinyl-styrene rubber (DSSK) production with a capacity of 60,000 tonnes a year at the end of 2020.