Production results
The total volume of processed ore for 9 months of 2021 amounted to 1.025 million tons (88.4% compared to 9M 2020), which corresponds to 54,573 tons of ferronickel from ore raw materials (84.2% compared to 9M 2020) and 11,700 tons of nickel (95.4% compared to 9M 2020). The decrease in production volumes compared to the same period last year is due to completion of the long-term overhauls of RTP-2 and TVP-3 in January and February 2021.
Financial results
The company had a pre-tax profit of UAH 6.8 million for 9M 2021; tax paid on earnings, calculated by taking into account tax differences, amounted to UAH 2.7 million during the same period.
During this reporting period, PFP paid taxes to the budget of Ukraine in the amount of UAH 105.5 million, an increase of 9.7% compared to 9M 2020. Of these, UAH 51.6 million were a single social contribution (14.4% more than 9M 2020) and UAH 40.4 million were payroll taxes (10.9% more than 9M 2020).
The average monthly salary paid by PFP for 9M 2021 amounted to UAH 13,286, an increase of 11.7% compared to the same period in 2020. Under its agreement with the holding company Solway Group, PFP management voted to increase wages by 5% starting from 01.01.2021 and by another 5% starting from 01.08.2021.
Ecology, social support, corporate governance systems (ESG)
Ecology
In 2017, as part of its sustainable business development plan, PFP’s shareholders approved a program to reduce the environmental impact of production, setting a goal of increasing the level of cleaning from emissions to 99.9% in accordance with European standards. At the same time, the plant began a long-term project for reconstruction of the third stage of gas cleaning equipment on tubular rotary kilns No. 1 and No. 2. In 2018, the first stage of construction was completed (UAH 48.1 million). The transfer of gas purification amounted to UAH 112.8 million.
In January and February 2021, major overhauls of the ore-thermal furnace No. 2 and the tubular rotary kiln No. 1 were completed on a temporary scheme with the installation of a chimney, as well as the transfer of gas pipelines to the chimney, which will allowed the second stage to be performed without stopping the main production.
In 2019, the company purchased a backup smoke exhauster and performed construction and installation works. In 2020, construction and installation works were carried out for the footings of the smoke exhauster and bag filters in the amount of UAH 8.4 million. The total amount of expenses (the cost of purchased equipment and works performed in 2018-2020) amounted to UAH 67.2 million. For 9M 2021, the costs of purchasing equipment and of construction and installation works amounted to UAH 33.3 million. Works are continuing during 4Q 2021. The launch of the third stage of gas cleaning tubular rotary kiln No.1 is scheduled for November 2021.
For 9M 2021, the cost of overhauls of the main technological equipment amounted to UAH 112.8 million. In January and February of this year, major overhauls of the ore-thermal furnace No. 2 and the tubular rotary kiln No. 3 were completed. In June, complete overhauls of tubular rotary furnace No. 2 (works connected with carrying roller replacement) and complete overhauls of the ore-thermal furnace No. 1 (works connected with replacement of contact plates) were performed. Major repairs of the drying department and tubular rotary kiln No. 1 are scheduled for October and November 2021.
For 9M 2021, investments in maintaining production potential and investments for economic effect (purchases of equipment and machinery, construction, etc.) amounted to UAH 44.5 million.
Social support
Within the framework of the charitable foundation “Development of Pobuzhye”, operating since 2013 on the basis of PFP, during 9M 2021, funds were also directed for the improvement of the wellbeing of the village and the societal needs of the local community.
In particular, PFP carried out repairs both outside (asphalt on the territory of the lyceum) and in the premises of kindergartens (roof repair, installation of underfloor heating); household appliances were also purchased (boilers, TVs, vacuum cleaners, air conditioners). Consumables for creativity, stationery, gifts for holidays and competitions, equipment for the inclusive center were funded. In addition, PFP provided targeted treatment assistance to employees and residents of the village.
In addition, assistance was sent to local medical institutions: the village hospital (a developor for the X-ray machine, X-ray film and cassettes, a dental X-ray machine, protective masks, detergents and stationery were purchased; the basement was repaired) and the ambulance station (tonometers, detergents and stationery were purchased, new windows were installed). Due to financial support from PFP, the Pobuzhsky Center for Emergency Medical Care received a completely new modern ambulance, equipped with all necessary equipment for emergency life support of patients on the way to the hospital.
Fire hoses and paint were purchased for the Ministry of Emergency Situations.
For the infrastructure of the village and the local community, new streetlamps for were purchased, video surveillance, benches and curbs were installed, and a children’s playground was repaired. Monthly financial assistance is provided to the utility company for garbage collection.
The total cost of maintaining the social sphere of the village of Pobuzhskoye for 9M 2021 amounted to UAH 3.2 million (on par with the same period last year). PFP spent UAH 7.4 million on sponsorship, cultural and mass works, and rehabilitation of employees (an increase of 66.6% compared to 9M 2020).
In addition, the plant continually supports the village council in local repairs. In the form of sponsorship, PFP financed the repair of the village police station in the amount of UAH 36,000. At the request of the regional state administration of the Kirovograd region, charitable assistance in the amount of UAH 100,000 was provided for the purchase of housing for ATO veterans.
Quarantine measures to prevent the spread of Covid-19
The plant continuously monitors the health of its employees for symptoms of the virus, as well as performs temperature control at the entrances of the enterprise.
As permanent preventive measures, shift disinfection of the cabins of technological vehicles and cranes and the cars of the dispatching service are carried out. Regular wet cleaning, daily disinfection of equipment and the working area are carried out; the premises are also ventilated.
Voluntary vaccination of employees is organized at the enterprise. Constant public health education is carried out, during which employees are given recommendations and explanations on preventing the spread of the virus. On an ongoing basis, assistance is provided to local and regional medical institutions.
Education
One of the main goals of the sustainable business development program of PFP is to improve the overall quality of education among residents of the areas adjacent to the enterprise and employees of the plant.
Costs for training of PFP personnel for 9M 2021 amounted to UAH 568,900, more than double the amount spent during the same time period in 2020. In just 9M 2021, courses funded by PFP trained 101 people for new professions, and 134 employees improved their qualifications. Currently, 17 people are studying at universities at the expense of the plant, of which 6 are full-time students on scholarship, and 11 employees of the plant are completing their studies on a part-time basis.
Since 2016, within the framework of Solway Group’s partnership with the International Salzburg Festival, the scholarship program @creative.fellowship has been implemented in Pobuzhskoye for talented young people. The program is based on the principle of intercultural exchange and aims to develop skills that will offer the young participants an advantage when finding future employment or pursuing entrepreneurial activities. Finalists in the @creative.fellowship program take part in the events of the youth program of the Salzburg Festival in Austria. Since 2020, the program has been held in a virtual format, which expands the geographies of its participants.
In addition, in the fall of 2020, PFP launched an interactive project “PICH”, the purpose of which is to acquaint teenagers in an accessible and exciting way with the opportunities offered by the mining industry. Ideally, the program also aims to increase the number of applicants who will choose technical or specialized disciplines in the future.