Dear members and partners,
Today “KOMOS GROUP” is Agribusiness Company of federal scale that holds leading positionsamong Russian food producers. Enterprises of the Holding are located within the territory of The Udmurt republic and Perm region and operate in poultry farming and egg production, pig farming and pork processing, milk processing, poultry farming and poultry meat processing, fish processing and frozen products producing and distribution. Over the last year the Company succeeded 5-year milestone from the foundation day. During this time we invested over 12 billion rubles into development of our member companies. Steadily going forward, the Company grew to federal scale; we made a crucial decision of redomiciliation of the Management Company: “KOMOS GROUP” LLC has been registered in Moscow since the 17th of March 2014.

To sum up the results of 2013 I would like to point out that in complicated market conditions, which arose after Russia WTO accession, thank to vertically-integrated system and correct business-line portfolios, the Company performed persistent growth and power to withstand external risks. In 2013 we focused our attention on fortification of competitive positions, cost management and operating efficiency enhancement. In 2013 we also carried on business process improvement and unitary production standards implementation; for instance we consolidated milk processing plants of the Company to form single corporate entity.The achieved results proved stability of our business: net profit of the Company, according to IFRS financial statements, totaled 22.3 billion rubles, compared to 20.9 billion rubles in the previous year.

Our goodwill allows us to build up long-term relations with leading banks of the State as well. Gross share of the strategic partner banks in the Company’s credit portfolio reached 72% by the end of the year: Rosselkhozbank JSC constitutes 29%, Gazprombank JSC constitutes 28%, and Ural Bank for Reconstruction and development JSC constitutes 15%.

Direct state subsidies had great influence on good financial result. I strongly believe that further development of Agro-Industrial Complex in Russia is possible provide public-private partnership: project of waste water treatment plant building at “Udmurtskaya poultry plant” LLC is the example of such partnership.

With a foundation of bank and State support in 2013 we duly implemented capital project by means of investing 1.2 billion rubles in upgrading and retooling of member companies.

Launching of meat processing at Krasnokamsky meat processing plant in Perm region became key event of the last year. In 2013 we paid special attention at logistic infrastructure development of the Company; logistic center at milk processing area “Sarapul-moloko” was run, egg marshalling logistic center “Varaksino” in Izhevsk is the next on the agenda. We enlarge commercial carrierfleet every year by means of own distribution developing. As a result the Company completely meets transport requirements and does business with external customers throughout Russia in an effective way.

We believe that healthy foods of well-known brand-name and efficient logistic system form the basis for successful sales development. The Company’s products are delivered to 54 regions of the country and can be found in stores of the following national retail chains: “Perekrestok”, “Lenta”, “Pyatyorochka”, “Magnit”, “Ashan”, “Karusel”, “Real Hypermarket”, “The Seventh Continent”, “Dixi”, «BILLA», “SPAR” and others. We export food products to countries of the near abroad – Byelorussia, Turkmenistan and Kazakhstan. New markets development became possible due to adoption of state-of-the-art technologies, that give us the ability to produce health food of improved storageability unpreserved.

Currently “KOMOS GROUP” – is the major employer in the Udmurt republic, which attracts the best industry specialists. Morethan 11 500 employees work at our member companies. In 2013 we invested over 15 million rubles into human resource training.

I would like to express my profound gratitude to our employees, creditors, investors, and to government agencies and municipalities in regions of our presence. We rely on long-term partnership with the State, taking part in regional and federal development agenda of agro-industrial complex.

In 2014 we will continue consolidating the Company’s position of powerful agribusiness, investing in process upgrading, production automation, new brands, relying on high potential of our employees and working closely with global market leaders. I do believe that in the coming years we will provide absolute majority of the Russian regions with health food and will make a considerable contribution to food security promotion within the State.

Chairman of the Management Committee – CEO
KOMOS GROUP LLC
Andrey Shutov