Russia 090804 Basic Political Developments

Russia's Sibirtelecom halves 2009 capex plans

http://www.reuters.com/article/rbssTechMediaTelecomNews/idUSL3353420090803
Mon Aug 3, 2009 8:28am EDT

* To spend 2.3 billion roubles on capital expenditure

* Plan cut from 4.5 billion roubles

* Aims at reducing debt by at least 10 percent

YEKATERINBURG, Russia, Aug 3 (Reuters) - Russian regional telecom company Sibirtelecom (STKM.MM: Quote, Profile, Research, Stock Buzz) has almost halved its capital spending forecast for this year in a move to reduce its debt burden, its Chief Financial Officer said on Monday.

Alexander Sheifer said in an Internet conference the investment plans were "significantly adjusted" and foresee 2.3 billion roubles ($73.83 million) in capital expenditure instead of an earlier planned 4.5 billion roubles.

The company had already said in June it was cutting 2009 spending to 4.5 billion roubles, down 60 percent on the year-earlier figure. [ID:nLH828456]

Sheifer said Sibirtelecom planned to raise 2.5 billion roubles via bonds and credit lines in the near future and would use part of the proceeds to refinance existing debt.

He added the company aimed at reducing debt by at least 10 percent this year.

Sibirtelecom (ENCO.RTS: Quote, Profile, Research, Stock Buzz), controlled by national telecoms group Svyazinvest, is Russia's No.6 cellular carrier, with more than 5 million mobile subscribers. ($1=31.15 ROUBLE) (Reporting by Natalya Shurmina; writing by Maria Kiselyova, editing by Will Waterman)

URALCHEM announces the production results for the first half of 2009

http://www.businessneweurope.eu/dispatch_text9392

Press release

August 4, 2009

URALCHEM, OJSC ("the Company" or "URALCHEM"), one of the largest producers of nitrogen and phosphate fertilizers in Russia and the CIS, today reported production results for the first half of 2009.

According to the results for the 1st half of 2009, URALCHEM enterprises produced 2,216,078 tonnes of commercial products, which is a 10% decrease compared to the 1st half of 2008 (including Voskresensk Mineral Fertilizers, OJSC).

Dmitry Osipov, Chief Executive Officer of URALCHEM commented: "Despite the ongoing instability in the international fertilizer markets, URALCHEM production results in the first half of 2009 show only a 10% decrease in the production of key commercial output compared to the first quarter of 2008. The decrease in production is mainly due to the ongoing difficulties with supplies of apatite concentrate - key raw material for phosphate fertilizers. As a result, in the first half of 2009 the production of these fertilizers, including DAP and MAP only reached one third of the result of the first half of 2008. It should be noted, however, that the Company was able increase the output of key nitrogen fertilizers by 10%. The world crisis resulted in a significant decrease in actual demand for fertilizers that has not yet restored. Nevertheless, the results of the first half of 2009 show that we have developed and are implementing an efficient program to overcome the effect of the economic decline and maintain stable production".

Russia's PIK subsidiary faces bankruptcy lawsuit

http://www.reuters.com/article/bankruptcyNews/idUSL311231520090803
Mon Aug 3, 2009 1:08pm EDT

MOSCOW, Aug 3 (Reuters) - A unit of Russian residential developer PIK Group (PKGPq.L: Quote, Profile, Research, Stock Buzz)(PIKK.MM: Quote, Profile, Research, Stock Buzz), which is in debt to the tune of $1.3 billion and engaged in lengthy restructuring talks, faces a bankruptcy lawsuit, court filings showed on Monday.

Leasing Force has filed the bankruptcy lawsuit against OOO PIK Development in the Moscow Arbitration Court, the court database showed.

Leasing Force, registered in a small city south of Moscow, could not be reached for comment.

A PIK spokeswoman declined to comment, saying the company had not fully examined the court filing.

Several creditors have sued PIK for overdue debts, including state bank VTB (VTBR.MM: Quote, Profile, Research, Stock Buzz) for 2.7 billion roubles ($86.68 million), holding company Sistema (SSAq.L: Quote, Profile, Research, Stock Buzz), the former owner of PIK peer Sistema Hals (HALS.MM: Quote, Profile, Research, Stock Buzz), for 950 million, and a unit of Renaissance Capital investment bank for 443.6 billion.

PIK's largest creditor, top Russian lender Sberbank (SBER03.MM: Quote, Profile, Research, Stock Buzz), which is owed 10.7 billion roubles, may restructure the bulk of the debt into a single facility, analysts have said.

Creditors are usually reluctant to test Russia's bankruptcy laws, largely untried in court, as way of getting back their money.

Of Russia's publicly listed developers, RTM (RTMC.MM: Quote, Profile, Research, Stock Buzz) has filed for bankruptcy. Among other high profile cases, aluminium tycoon Oleg Deripaska's construction company, Glavstroi, faces two bankruptcy suits. ($1=31.15 Rouble) (Reporting by Yuliya Komleva; writing by Melissa Akin; editing by Karen Foster)

One-Third of Russia’s Clothiers Are Going Bust, Exporters Say

http://www.bloomberg.com/apps/news?pid=20601085&sid=avJFk.8FUq8U

By Holger Elfes

Aug. 4 (Bloomberg) -- A third of Russia’s 42,000 clothing retailers will close by the end of this year after the economic crisis hurt local spending, according to the head of the European Fashion and Textile Export Council.

The likely retail failures and order cutbacks in Russia mean companies in fashion-exporting nations such as Germany will deliver less apparel for the winter season, said Reinhard Doepfer, who leads the Brussels- and Stuttgart-based industry group. He said the Council surveyed German clothing makers and found an average of 35 percent of their deliveries to Russia would be unsold this summer.

“Many important German fashion suppliers have deleted between 20 percent and 30 percent of Russia’s fashion retailers from their customer records, because they don’t meet the basic conditions of doing business any more,” Doepfer said in an interview at last week’s CPD fashion fair in Dusseldorf.

German clothing companies ranging from luxury brand Hugo Boss AG to menswear maker Ahlers AG targeted Russia for growth as the nation’s economic growth outpaced that of Germany earlier this decade. Boss, known for its men’s suits, reported a wider loss last week, citing a 35 percent plunge in revenue from eastern Europe, excluding the effect of foreign-exchange moves. Russia is the label’s largest market in the region.

Germany is Europe’s second-largest fashion-exporting nation, trailing only Italy. Germany’s first-quarter fashion sales to Russia declined 6 percent to 162 million euros ($231 million), according to Doepfer.

The decline will accelerate during the year, as autumn- winter orders have fallen about 30 percent, he added.

Too Pessimistic

Some Russian analysts said Doepfer’s estimate was too pessimistic, though they acknowledged the weak local demand.

“About 10 percent to 20 percent of retailers may go bankrupt this year, but not a third,” said Anna Lebsak- Kleimans, president of Moscow-based researcher Fashion Consulting Group. Some of the halted German shipments will be replaced by cheaper imports from China and Turkey, she said.

“Retail chains may be reducing the number of outlets, but they are not shutting down completely,” she said.

The gross domestic product in Russia, the world’s biggest energy exporter, shrank 9.8 percent in the first quarter, the worst contraction in 15 years. The average monthly wage dropped 5.2 percent in June.

Germany exported clothes worth 750 million euros last year to Russia, 6 percent more then in the previous year, according to Doepfer. Italy exported fashions to Russia worth 1.25 billion euros, and will also post a decline, he said.

To contact the reporter on this story: Holger Elfes in Dusseldorf at [e-mail].

Last Updated: August 3, 2009 20:00 EDT