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Gus-Khrustalny raises sales

The Gus-Khrustalny factory, in the Vladimir region in Central Russia, has completed an overhaul of a workshop capable of producing Rbs 84 million (US$ 2.9 million) worth of products a year and plans t…

The Gus-Khrustalny factory, in the Vladimir region in Central Russia, has completed an overhaul of a workshop capable of producing Rbs 84 million (US$ 2.9 million) worth of products a year and plans to boost output by a third this year, raising sales to US$ 12 million. The factory, now owned by a group of top managers, was founded in 1756. The nation“s biggest crystal manufacturer was lying in ruins under external management until spring 1998 after accumulating losses of Rbs 100 million (US$ 16 million), but ruble devaluation coupled with strenuous efforts by the new management team and local government, returned the company to profit. Gus-Khrustalny now cherishes several investment projects together worth some DM 5 million (US$ 2.46 million) and intends to raise the share of production it exports to 20%. “We have already secured contracts with Jordan, Kuwait and Saudi Arabia,” said Tatyana Andreyeva, spokeswoman for the company. While praiseworthy, Gus-Khrustalny“s performance is far from unique for the industry. It grew 19.5% last year, making it the fourth fastest-growing industrial sector, according to the Russian Statistics Agency. It followed microbiology, which grew 29.2%, the chemical and petrochemical industry, and textiles. With profit margins swelling, private businesses ran to buy assets on the cheap and started modern production. “Our factory was lying dead for three years until last November,” said Andrei Vyacheslavov, managing director of the Chagodishchinsky Glass Works, which was acquired by the Stepan Razin brewery to produce beer bottles. Chagodishchinsky, which is located in the Vologda region about 500 kilometres north of Moscow, has a capacity of 72 million bottles a year and intends to double output. The factory employs 700 people and its annual revenues are projected at Rbs 108 million (US$ 3.38 million) for 2000. Chagodishchinsky, which is about a fifth of the size of Gus-Khrustalny, operated obsolete equipment when the reforms started in the early “90s and was forced out of the sheet-glass market. “The technology was out of date at the beginning of the 1970s and was of such low quality that the factory could not benefit from the construction boom of the 1990s,” Vyacheslavov said. The factory switched to beer-bottle production and to using gas instead of more expensive fuel oil. The Anopino glass factory, owned by the Russian-American Glass Co., RASKO, teamed up with US Agribusiness Management Company and has ploughed US$ 20 million into producing bottles, mostly for vodka distillers. Anopino, located in the Vladimir region, will produce 120,000 bottles a month and plans to install new equipment to raise output by 70,000 bottles and later by 90,000 bottles a month. The project was finalized in January this year, enabling RASKO to supply Moscow“s Kristall vodka factory, Dovgan beverage retailer and the Soyuzplodimport beverage exporter. Growth in the beverage industry has led to higher output in adjacent industries. Domestic beer consumption surged 27.3% last year as locally produced brews were substituted for imports and the number of beer fans grew. Alcohol production was up 26.4% with companies beginning to take over their bottle suppliers. St. Petersburg“s Tinkoff brewery recently launched its own bottle line with a capacity of 2,000 bottles per hour, according to a local newspaper. Three hundred factories produce glass in Russia and the Commonwealth of Independent States, with most production located in Russia and Ukraine.

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