Ukroboronprom is implementing an anti-crisis plan at Malyshev Plant

Author

Maksim Nechiporenko

State Concern Ukroboronprom is implementing an anti-crisis plan at SE Malyshev Plantand and is going to finish 2021 with a profit at the plant.

This is stated in the Concern’s message in response to a letter from the primary trade union of the Kharkiv Malyshev Plant "Protection of Justice".

"The company is in a difficult financial position due to a significant debt burden, the presence of surplus assets, lack of orders, restrictions on receiving prepayments under contracts with the Ministry of Defense of Ukraine, the impact of the pandemic caused by the spread of coronavirus infection COVID-19", the State Concern notes.

But Ukroboronprom and the plant are jointly implementing an anti-crisis action plan approved by the board of directors of Ukroboronprom and a program for the financial recovery of the enterprise.

Due to this, the company's loss in 2020 was reduced from 420 million UAH to 112 million UAH compared to 2019.

Over the same period, the volume of marketable products production at the plant increased 2 times, the volume of marketable products sales increased 2.2 times, the tank engines production—1.6 times, and labor productivity increased 1.9 times.

At the same time, losses from rejects decreased by 42%, administrative costs—by 16%, general production costs—by 5.7%, electricity and gas consumption—by 4.3% and 45.4%, respectively.

"According to operational information, at the end of the Q1 of this year, Malyshev Plant will receive a positive financial result and plans to make a profit based on the results of work in 2021", the State Concern notes.

In 2020, the average salary of production personnel was increased by 9%. "Now it is 11,558 UAH, and that, according to statistics, exceeds the figures of other industrial enterprises in the Kharkiv region. Timely payment of salaries depends on customers' compliance with the payment procedure for delivered products," the Concern explained.

Context. The plant's accounts payable have formed over the past 9 years, and Ukroboronprom plans to resolve this issue by replenishing the authorized fund and/or initiating the adoption of a regulatory legal act to write off or introduce another repayment mechanism.

Primary trade union organization of Malyshev Plant sent a letter signed by the Chairman of the organization Heorhii Kalabin to President Volodymyr Zelensky on April 5 with a request to prevent the enterprise's elimination.

The text said that ineffective management led to a crisis at the enterprise, in particular, the plant ended 2020 with a loss of 112.4 million UAH. There are also few orders for the current year: the projected production volume for the Q1 of the year is 169.2 million UAH. At the same time, the total accounts payable as of January 1 amounted to 1.8 billion UAH. It was also reported that employees did not receive their salaries for February and March.

On March 17, the union asked Ukroboronprom to terminate the contract with the current Director of the plant.

Malyshev Plant is a state-owned enterprise specializing in the production and modernization of heavy and light armored vehicles. Vasyl Krylas has been the CEO since January 9, 2020.