Chelyabinsk Zinc Plant ended 2009 with a profit, contrary to the predictions of some analysts. The company’s operations in the first three quarters of the year brought in a profit of RUR 268 million (computed under International Financial Reporting Standards). In the first 9 months of 2009, the company spent RUR 1.1 billion. Chelyabinsk Zinc Plant is the largest zinc producer in Russia. The company processes more than 60 percent of zinc in Russia.  

In general, the company’s revenue decreased 22 percent as a result of a smaller volume of sales and slowed production. Total revenue was RUR 6.5 billion. The EBITDA indicator increased by 55 percent to RUR 1.15 billion.

While the price of zinc went down nearly 30 percent in the first three quarters of 2009 to USD 1 472 per metric ton, the devaluation of the Russian currency by more than 1/3 against the American dollar compensated for the difference.

The output of zinc and zinc alloys at Chelyabinsk Zinc Plant was decreased by 30 percent in the first three quarters of 2009. The total volume of zinc produced was 83 200 tons.

Despite the negative market dynamics, Chelyabinsk Zinc Plant was able to increase profits by optimizing production and transportation, which resulted in lower operating expenses. Also, the company made it a target to focus on the domestic market. The company’s transportation expenses decreased by 11 percent, while the cost of goods sold went down by a whole 31 percent. Zinc concentrate and electricity were the company’s two biggest spending items. Purchases of zinc concentrate decreased by 40 percent to RUR 2.7 billion. Capital outlays stood at RUR 1 billion – expenses associated with the development of the Amurskoye field. Most of the expenditures for 2009 were associated with the development of that deposit.

Sales of zinc and zinc alloys at Chelyabinsk Zinc Plant amounted to 83 800 tons in the first three quarters of 2009. Exports accounted for 36 percent of that number, or 30 500 tons.

In September of 2009, two companies Russian Copper Company and Urals Mining and Metals Company bought out NF Holdings B.V., which was the controlling shareholder of Chelyabinsk Zinc Plant.