Activity trends of the largest machine-building enterprises in Volga federal district of Russia

trends 11/12/2019

Information agency Credinform represents an overview of activity trends of the largest machine-building enterprises in Volga federal district of Russia.

Machine-building enterprises with the largest volume of annual revenue (TOP-1000) of the federal district were selected for the analysis, according to the data from the Statistical Register for the latest available periods (for 2013 - 2018). The analysis was made on the basis of the data of the Information and Analytical system Globas.

Net assets value is an indicator, reflecting the real value of company’s property, is calculated annually as the difference between assets on the enterprise balance and its debt obligations. The indicator of net assets is considered negative (insufficiency of property), if company’s debt exceeds the value of its property.

The largest machine-building enterprise of Volga federal district in terms of net assets is KAMAZ PJSC, INN 1650032058, Republic of Tatarstan. Its net assets amounted to more than 45 billion rubles in 2018.

The smallest amount of net assets in the TOP-1000 list was hold by CHEBOKSARY TRACTOR PLANT PJSC, INN 2126003074, Chuvash Republic. The insufficiency of property of this company in 2018 was expressed as a negative value of -112,6 billion rubles.

The average values of net assets tend to decrease over the five-year period (Picture 1).

Picture 1. Change in the average indicators of the net asset value of TOP-companies in 2014 – 2018 Picture 1. Change in the average indicators of the net asset value of TOP-companies in 2014 – 2018

The shares of TOP-1000 enterprises with insufficiency of assets have a tendency to decrease in the last five years (Picture 2).

Picture 2. Shares of enterprises with negative values of net assets in TOP-1000 Picture 2. Shares of enterprises with negative values of net assets in TOP-1000

Sales revenue
The revenue volume of 10 leading regional companies of the industry made almost 45% of the total revenue of TOP-1000 in 2018. (Picture 3). It points to a high level of monopolization in machine-building industry of Volga region.

Picture 3. Shares of participation of TOP-10 companies in the total revenue of TOP-1000 enterprises for 2018 Picture 3. Shares of participation of TOP-10 companies in the total revenue of TOP-1000 enterprises for 2018

In general, there is a tendency to increase in the revenue volumes (Picture 4).

Picture 4. Change in the average revenue of TOP-10 companies in 2014 – 2018 Picture 4. Change in the average revenue of TOP-10 companies in 2014 – 2018

Profit and loss
The largest company of the industry in Volga region in terms of net profit value is ODK-UMPO PJSC, INN 0273008320, Republic of Bashkortostan. The company's profit amounted to 14,3 billion rubles in 2018.

For four out of five years the TOP-1000 companies had losses with a tendency to their increase (Picture 5).

Picture 5. Change in the average indicators of profit (loss) of TOP-10 companies in 2014 – 2018 Picture 5. Change in the average indicators of profit (loss) of TOP-10 companies in 2014 – 2018

Average values of net profit’s indicators of TOP-1000 enterprises have a tendency to their increase over a five-year period, at the same time the average value of net loss also increases. (Picture 6).

Picture 6. Change in the average indicators of net profit and net loss of TOP-10 companies in 2014 – 2018 Picture 6. Change in the average indicators of net profit and net loss of TOP-10 companies in 2014 – 2018

Key financial ratios
Over the five-year period the average indicators of the total liquidity were above the range of recommended values - from 1,0 up to 2,0, with a tendency to decrease. (Picture 7).

The total liquidity ratio (the relation of the amount of current assets to short-term liabilities) shows the sufficiency of company’s funds for repayment of its short-term liabilities.

Picture 7. Change in the average values of the total liquidity ratio of TOP-10 companies in 2014 – 2018 Picture 7. Change in the average values of the total liquidity ratio of TOP-10 companies in 2014 – 2018

Over the course of five years, there is a relatively high level of average values of the indicators of the investment ratio, with a tendency to increase. (Picture 8).

The ratio is calculated as the relation of net profit to the sum of own capital and long-term liabilities and demonstrates the return on the equity involved in the commercial activity and the long-term borrowed funds of an organization.

Picture 8. Change in the average values of the return on investment ratio of TOP-10 companies in 2014 – 2018 Picture 8. Change in the average values of the return on investment ratio of TOP-10 companies in 2014 – 2018

Asset turnover ratio is calculated as the relation of sales proceeds to the average value of total assets for a period and characterizes the efficiency of use of all available resources, regardless of the sources of their attraction. The ratio shows how many times a year a complete cycle of production and circulation is made, yielding profit.

This ratio of business activity showed a tendency to decrease over the five-year period (Picture 9).

Picture 9. Change in the average values of the asset turnover ratio of TOP-10 companies in 2014 – 2018 Picture 9. Change in the average values of the asset turnover ratio of TOP-10 companies in 2014 – 2018

Small business
63% of TOP-1000 companies are registered in the Register of small and medium-sized enterprises of the Federal Tax Service of the RF. At the same time, their share in the total revenue of TOP-1000 enterprises mounts to 7% that is significantly lower than the national average (Picture 10).

Picture 10. Shares of proceeds of small and medium-sized enterprises in TOP-1000 companies Picture 10. Shares of proceeds of small and medium-sized enterprises in TOP-1000 companies

Main regions of activity
The TOP-1000 companies are registered in 14 regions and distributed unequal across the federal district. More than 62% of the largest machine-building enterprises in terms of revenue are concentrated in the Republic of Tatarstan, Samara and Nizhny Novgorod regions (Picture 11).

Picture 11. Distribution of the revenue of TOP-1000 companies by regions of the Volga federal district of Russia Picture 11. Distribution of the revenue of TOP-1000 companies by regions of the Volga federal district of Russia

Financial position score
An assessment of the financial position of TOP-1000 companies shows that most of them are in above average financial position (Picture 12).

Picture 12. Distribution of TOP-1000 companies by financial position score Picture 12. Distribution of TOP-1000 companies by financial position score

Solvency index Globas
The vast majority of TOP-1000 enterprises got Superior/High or Strong/Medium Solvency index Globas, that points to their ability to pay off their debts in time and fully (Picture 13).

Picture 13. Distribution of TOP-1000 companies by solvency index Globas Picture 13. Distribution of TOP-1000 companies by solvency index Globas

Industrial production index
According to the Federal State Statistics Service, there is a decrease in indicators of the industrial production index in the machine-building industry in the Volga federal district during 12 months of 2018 – 2019 (Picture 14). At the same time, the calculated average index month-over-month amounted to 105,5%.

Picture 14. Industrial production index in the machine-building industry of the Volga federal district in 2018 - 2019, month-over-month (%) Picture 14. Industrial production index in the machine-building industry of the Volga federal district in 2018 - 2019, month-over-month (%)

Conclusion
A comprehensive assessment of activity of the largest machine-building enterprises of the Volga federal district, taking into account the main indices, financial indicators and ratios, points to the absence of a pronounced general trend (Table 1).

Table 1. Positive and negative trends, evaluation factors of TOP-1000 companies
Trends and evaluation factors, TOP-1000 Specific share of factor, %
Rate of growth (decline) in the average size of net assets down-10
Increase / decrease in the share of enterprises with negative values of net assets up10
Level of competition / monopolization down-10
Rate of growth (decline) in the average size of revenue up10
Rate of growth (decline) in the average size of profit (loss) down-10
Growth / decline in average values of net profit of TOP-1000 companies up10
Growth / decline in average values of net loss of TOP-1000 companies down-10
Increase / decrease in average values of total liquidity ratio up5
Increase / decrease in average values of return on investment ratio up10
Increase / decrease in average values of asset turnover ratio, times down-10
Share of small and medium-sized enterprises in the region in terms of revenue being more than 22% down-10
Regional concentration down-10
Financial position (the largest share) up10
Solvency index Globas (the largest share) up10
Industrial production index up5
Average value of the specific share of factors up0,0

Up positive trend (factor), Down negative trend (factor).