Hearing the report of the Board of JSS "Maxam-Chirchiq" on the results of financial and economic activities, the implementation of the business plan, as well as the measures taken to achieve the development strategy of JSS "Maxam-Chirchiq" based on the resulta of 2021.                       

 

Report of the Board on the results of financial and economic activities.

1.   Fulfillment of the production plan.

 

For 2021, the JSS “MAXAM-CHIRCHIQ” produced marketable products in current prices in the amount of UZS 2,193.7 billion or 125.1% of the projected volume, while the growth rate of production compared to last year made 102.6%.

The fulfillment of the forecast indicators for the release of the main types of products is as follows:

 

Name of the product	Unit of meas.	Task	Produced	Fulfillment of plan %	Growth rate
Synthetic ammonia	tn	538 000	532 741	99,0	96,8
including commercial grade	tn	72 000	42 802	59,4	71,5
Mineral fertilizers in 100% nitrogen	tn	319 890	343 544	107,4	98,0
Ammonium nitrate	tn	450 000	523 307	116,3	97,5
Urea	tn	270 000	245 782	91,0	96,2
Ammonium sulfate	tn	190 000	233 263	122,8	104,8
LDAN	tn	60 000	70 185	117,0	111,1
Weak nitric acid .	tn	442 000	496 810	112,4	101,8
Including commercial grade	tn	24 000	25 909	108,0	117,5
Strong nitric acid.	tn	181 400	190 216	104,9	102,2

 

2.   Utilization of production capacities.

 

Capacity utilization rates ranged from 60.1% for ammonia production to 117.0% for LDAN production. The average percentage of production capacity utilization for the whole company during the whole year made up 83.9%, which is 5.2 points higher than that established by the Business Plan.

 

Name of the product	Unit of measure	Annual production capacity	Output	% of capacity utilization
Ammonia production	tn	245 800	147 661	60,1
Ammonia-76	tn	420 000	385 080	91,7
Ammonium nitrate	tn	450 000	523 307	116,3
Urea	tn	270 000	245 782	91,0
Ammonium sulfate	tn	294 000	233 263	79,3
LDAN	tn	60 000	70 185	117,0
Weak nitric acid .	tn	662 000	496 810	75,0

 

Main reasons of nonfulfillment of the production assignments and reduction of production volume growth rate compared to last year are the following:

- lack of ammonia and carbon dioxide for the production of urea due to the unloaded operation of the Ammonia-76 unit due to the low pressure of natural gas in January and February;

- lack of shipment of commercial ammonia for export.

 

3.   Production of consumer goods.

 

In 2021, the company produced consumer goods in the amount of UZS 7 645.2 million, which is 0.3% of the total production. The task for the production of consumer goods was fulfilled by 205.0%, the growth rate compared to last year made 200.2%.

The main volume of consumer goods:

 

Name of the product	Unit of meas.	Quantity	Amount (UZS million)
Liquid carbon dioxide	tn	2 831	5685,6
Liquid mineral fertilizers (UAM)	tn	1 177	1 472,4
Magnesium sulfate in a pack of 25 kg	tn	96	290,4
Dry ice	tn	105	246,2
Magnesium nitrate (25 kg each)	tn	20	53,5
Compressed oxygen	tn	21	40,2
Other consumer goods (used for our own needs)			-143,1

 

4.     Technical condition of fixed assets.

 

For 2021, fixed assets were put into operation in the amount of UZS 44 604.2 million. The depreciation of the company's fixed assets increased over the year from 76.0% at the beginning of the year to 77.9% as of January 1, 2022.

The cost of major repairs of fixed assets for the year amounted to UZS 86 843.1 million, including:

machines and equipment – UZS 73 436.1 million,

buildings and facilities – UZS 8 733.5 million,

transportation – UZS 4 673.5 million.

 

5.     Development of new types of products, implementation of production localization projects.

 

According to the “List of production localization projects for 2020-2021 approved by the Chairman of the Board of JSC “Uzkimyosanoat”, JSS “MAXAM-CHIRCHIQ” produced localized products in the amount of UZS 158 762.4 million in 2021, with a plan of UZS 88 230.1 million, the implementation amounted to 179.9%.

Produced in kind:

 

Name of the product	Unit of meas.	Production	Sale	Used for own needs
Modified porous nitrate	thousand tons	4,9	4,9
Carbamide with sulfur -magnesium trace elements	thousand tons	68,9	68,9
Magnesium nitrate	thousand tons	0,1	0,01
Anti-caking agent for ammonium nitrate	thousand tons	0,16		0,16
LDAN solution	thousand tons	13,3	13,3
Nanometric zinc oxide	thousand tons	0,06		0,06
Solid carbon dioxide	thousand tons	0,13	0,12	0,01
Water Soluble NPK Fertilizers	thousand tons	0,01

 

In total, under the Localization Program, products were sold in the amount of UZS 150,776.5 million including exported in the amount of USD 7.8 million.

 

6.   Sales of finished products.

 

The shipment of mineral fertilizers in 2021 was carried out in accordance with the Forecast parameters for the production and sale of mineral fertilizers, approved by the Prime Minister Advisor of the Republic of Uzbekistan A. Sultanov. Mineral fertilizers were put up for exchange trading according to the approved schedules.

In 2021 the following products were supplied to consumers:

 

Item	Unit of meas	Sale
		Total	including
			exchange trading	export
Ammonium nitrate	tn	518 746	457 624	61 122
Urea	tn	253 666	149 273	104 393
Ammonium sulfate	tn	239 604	183 789	55 815

 

The following chemical products were also supplied:

42 802 tons of Ammonia were shipped,

Weak nitric acid (mng) - 25,909 tons, including for export - 2,283 tons,

Sulfuric acid - 3,290 tons.

 

 

7. Export and import.

 

For 2021, the following products were exported:

Item	Unit meas	Q-ty	Amount, USD thous.
Ammonium nitrate	tn	61 121,5	15 072,0
Urea	tn	104 393,1	29 949,0
Ammonium sulfate	tn	55 815,4	7 756,8
Weak nitric acid (nat)	tn	3 974,0	853,9
LDAN	tn	52 230,7	10 891,4
Carbon dioxide	tn	268,6	50,5

 

In total, products worth USD 64 574.5 thousand were exported, the set target in the amount of USD 56 741.7 thousand was fulfilled by 113.8%.

The share of export revenues in the total net sales amounted to 30.6%.

Import of material and technical resources for 2021 amounted to USD 14 640.5 thousand, including foreign currency funds were used for:

- raw material for production of outputs - USD 2 377.7 thousand;

- process equipment - USD 1 716.7 thousand;

- components and spare parts - USD 6 935.1 thousand;

- services of an industrial nature - USD 3 611.1 thousand.

Of the total amount, imports for the implementation of the Technical Audit program - the replacement of obsolete and physically worn out equipment (according to ПП №2692 dated 22.12.2016) amounted to USD 739.2 thousand.

 

8.     Economic indicators of production.

 

In 2021, the enterprise sold products in the amount of UZS 2 191.9 billion and received profit before tax of UZS 480.9 billion, after taxes, net profit amounted to UZS 362.5 billion. Product profitability in terms of net profit made 16.5%.

Actual expenses for the period amounted to UZS 517.9 billion, exceeding the planned amount by UZS 225.5 billion, including due to:

- increase in costs for shops without production (during the period of overhaul and shutdown due to lack of gas supply) - UZS 8.9 billion;

- payment of bonuses based on the results of work for the year in accordance with the Collective Agreement - UZS 15.6 billion;

- accrual of the reserve for labor holidays - 40.0 billion UZS;

- accrual of a reserve for doubtful debts - 211.3 billion UZS.

The amount of the overspending is partially offset by savings on other items of expenses of the period.

The balance of expenses and incomes on financial activities amounted to UZS 1 101.7 mln., expenses on financial activities - UZS 15 308.1 mln., income - UZS 14 206.4 mln.

 

9.     Financial state.

 

The financial state of the Company has significantly improved.

Over the year, accounts receivable decreased by UZS 15 357.6 mln. and as of 01.01.2022 amounted to UZS 144 468.5 mln., incl. overdue UZS 8,030.2 million, in addition, the debt of JSC “Uzsanoatexport” in the amount of UZS 9,201.5 million and TJSC “Uzagrokimyohimoya” in the amount of UZS 35 769.6 million was assigned to the reserve for doubtful debts.

From total receivables:

		Receivables	Overdue debt
Intradepartmental	UZS mln.	59 910,5
Other debtors	UZS mln.	84 558,0	8 030,2

 

 Accounts payable for the year decreased by UZS 67 257 mln. and as of 01.01.2022, amounted to UZS 90 358.6 mln., incl. overdue - UZS 3 347.9 mln.

Main debts:

		Accounts payable	Overdue debt
Wage arrears	UZS mln.	21 858,7	-
Debt to the budget	UZS mln.	48 292,2	-
Debts to state trust funds	UZS mln.	3 358,7	-

 

The balance between accounts receivable and accounts payable as of 01.01.2022 amounted to UZS 54 109.9 mln.