On September 13, 2019 APPM JSC was visited by Evgeny Ryzhov, Director of the Department of light industry and forestry of the Ministry of Industry and Trade of the Russian Federation.

The rules of proceedings involved the visit to the production site of the mill, including the objects of priority investment projects (hereinafter – PIP) relating to the forest exploitation “Retrofitting of APPM cardboard production”: new evaporation station, which is under construction, and cardboard production site where board machine No 2 was launched.

Then the group had a business meeting on issues relating to PIP implementation in APPM and on the results of PIP implementation in Sawmill 25 LLC relating to forest exploitation “Construction of woodworking plant in Maimaksa district of Arkhangelsk, 25, Rodionova st.”.

The meeting was opened by Dmitry Zylev, Director General of APPM, who told that that day the mill received the original of a document signed by the Minister of Industry and Trade of the Russian Federation Denis Manturov, regarding the assignment of additional cutting area to APPM due to the changes in PIP strategy implemented ahead of schedule. As for production development connected with the start-up of new BM-2, first results can be already seen: for the past three months APPM has been checking the new equipment, and for the present day, the specified values planned for the project, are overrun.

On the meeting, main PIP parameters of APPM were announced. Total sum of investments is 17.5 bln rubles.

Based on the results of the second quarter of 2019, actual financing of the project was 14.1 bln rubles, with 10.5 bln rubles planned. Fulfilment of APPM engagements on PIP financing on a cumulative total by the end of the first quarter of 2019 is 135.2%.

PIP results: annual cooking rate of the mill will increase by 140,500 tons, annual cardboard and corrugated paper production will increase by 119,600 tons.

APPM will finish PIP in 2020.

According to Financial Director of APPM Oleg Gubin, the project was revised several times due to the economic circumstances and incorporation of new subprojects and updates. Most part of funds is borrowed in banks for purchasing the foreign equipment. Pay-back period is by 2023.

As told by Director General of APPM Dmitry Zylev, the mill is already making plans on the further development: “Together with Titan Group of Companies, we provide 100% of harvested wood processing; our upstream integration is in progress. The holding has corrugated paper production plants in Podolsk and Istra; recently we have bought an asset and launched a plant in the Voronezh region. We have a lofty agenda regarding the pulp line, as well as in the segment of packaging paper, specifically, paper bags which are replacing plastic”.

During the meeting, the word was taken by Deputy Director for Government Relations of APPM Yuri Trubin, who raised a topic of shortage of the raw forest materials in the Arkhangelsk region.

“Calculated cutting area of the region is 25 mln cub.m, of which 16 mln cub.m is given for rent, and around 3 mln cub.m is a short-term utilization area which covers the demands for wood of the municipal authorities, population, small and medium enterprises. And one more part, 9 mln cub.m, is given to protectable areas. The resources are stretched” – accentuates Mr. Trubin.

He also pointed out the need of raising the validity period of forestland rental contract from 49 years to 99 years.

Assessing the visit, Evgeny Ryzhov, Director of the Department of light industry and forestry of the Ministry of Industry and Trade of the Russian Federation, told that within 7-8 years APPM has invested heavily in modernization of production. “For us, the Ministry of Industry and Trade of the Russian Federation, productivity gains of an enterprise is one of priority areas of work. Of course, we always have issues to be solved, there are questions on raw materials base, but they are being handled on regional, as well as on federal level. We are keeping finger on the pulse, and I think that we’ll see positive changes soon” – summarized Evgeny Ryzhov.