Ukrainian poultry and feed producer, MHP, is starting to bounce back after the Russian invasion of Ukraine caused massive disruption and profit loss and reports a Q4 2022 net profit of US$ 38 million.
“There are ongoing risks to the Company’s operations due to recurring attacks on the critical infrastructure of Ukraine,” according to the company’s Q4 2022 financial report, “however, as of today all MHP’s production facilities in Ukraine continue to operate at close to full capacity.”
Product volume and profits
Despite being close to full capacity, Q4’s domestic production volume is still lower than the same time the previous year at 181,583 tons vs. 202,657 tons. However, the company’s European Operating Segment saw volume increase by 11% at 31,147 tons vs. 2021’s 28,043 tons.
MHP is also renewing exports to over 70 countries for all its product segments, with Q4’s poultry exports at 111,130 tons compared to 104,841 tons in 2021 – an increase of 6%.
The war’s impact on operations
In contrast, due to logistical challenges and lower domestic demand brought on by the war, the amount of poultry sold over the 2022 financial year decreased by 5% at 665,975 tons.
According to MHP, none of the company’s facilities have been damaged by the war, but contingency plans are in place to restore operations quickly if damage occurs.
Since the invasion began in February 2022, the company amassed US$69 million of war-related costs like donations, inventory write-offs and biological assets.
“As the overall situation in Ukraine continues to be fluid, we are unable to provide any meaningful guidance as to the outlook for the Poultry segment for the 2023 full year,” according to the financial report. “With all our land located outside war zones, we are hopeful that we will be able to harvest the same 360,000 hectares as in 2022.”
