Press release

Kiev

Ukraine's biggest heavy engineering holding Mining Machines significantly improved its performance in 2011. In particular, the company increased production by 94% or 4,737 items of mining equipment compared with 2010.

The output grew firstly because of a number of changes in operations and organisation as well as an investment programme launched to upgrade production facilities. Also, the company singled out maintenance and sales offices into individual entities.

The positive trend of 2010 in certain product lines continued in 2011. In particular, Mining Machines raised production of powered supports by 49%, shearers – 23.6%, hoisting equipment – 49.1%, wheeled vehicles - 100.8%, pump houses – 83.3%, belt conveyors - 109.3% and electrical substations - 34%.

Main plants of the company kept the positive production trend, which started in 2010. Druzhkovka Heavy Engineering Plant boosted output by 83%, Gorlovskiy Mashinostroitel plant - by 44%, Donetskgormash - 45%, Donetsk power plant - by 163%.

Organisational and operating improvements

To develop after-sales services, increase sales, improve quality, terms and customer care, the company established in 2011: 

• a service company;
• a sales company in Ukraine;
• a sales company in Russia.

In addition, Mining Machines brought consistency to organisational structures of its production plants and ensured their compliance with business objectives. Mining Machines - Business Comfort was established to reform non-core functions at operating enterprises and the managing company and to improve the economic efficiency of auxiliary services. A project management office was created for efficient management of company's strategic projects.

Investment programme

The first stage of the investment programme was one of the key factors driving our output. It started in 2011 and amounted to around UAH 112 million with the core focus on acquisition of capital and auxiliary equipment from other countries, overhaul of buildings and constructions and IT development projects. 

These investments helped the Company to increase significantly its production, raise quality and cut primary cost. For example, six plants installed real-time consumption control devices on the power equipment, which, along with other organisational actions, saved UAH 977,300.

Since June 2011 the businesses within Mining Machines reduced downtime of production equipment caused by breakdowns on average by 3%.

Export

In 2011 Mining Machines focused on expanding the geography and volume of sales in external markets.

Exports grew 58% in 2011 year on year with the biggest customers including SUEK, EvrazHolding, Uralkali, Norilsk Nickel, Metalloinvest, Russian Coal, Vorkutaugol, Kazchrome, Kazzinc, Kazakhmys, Belaruskali, Mosmetrostroy and others.

Mining machines increased exports thanks to active marketing (launched a sales company in Russia and enhanced after-sales service) and integration of Krivoy Rog Mining Equipment Plant, which expanded operations of Mining Machines in the market of equipment used for open pit mining.

Profile

Mining Machinesis the largest Ukrainian company producing mining equipment. It belongs to the financial and industrial group, System Capital Management (SCM). The company produces and delivers equipment and machinery for the mining industry. 

Mining Machines comprises the leading machine builders in Ukraine and Russia: Druzhkovka Heavy Engineering Plant, Gorlovskiy Machinostroitel heavy engineering plant, Donetsk power equipment plant, Donetskgormash heavy engineering plant, Krivoy Rog Mining Equipment Plant, Mining Machines research and technical centre, Mining Machines – Quality System, Mining Machines service company and MINING MACHINES RUS.   

Yevgeniy Buzykin,

Manager for External Communications

Mob: +38 (050) 347 73 61

www.mmc.kiev.ua