In order to reduce the interregional differences in the level and quality of life of the population, to accelerate economic growth and technological development and to ensure the national security of the country, in February 2019 Russian Government approved the Strategy of Spatial Development of the Russian Federation until 2025. It consists of 12 macro-regions; one of them is East Siberian macro-region, which includes Transbaikal region, Irkutsk region, Krasnoyarsk region, the Republic of Buryatia, Tuva and Khakassia Republic.

Information agency Credinform has prepared a review of activity trends of the largest companies of the real economy sector in East Siberian economic district of Russia. The largest companies (ТОP-1000) in terms of annual revenue were selected according to the data from the Statistical Register for the latest available periods (2013 - 2018). The analysis was based on data of the Information and Analytical system Globas.

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

The largest company in terms of net assets is JSC Federal Hydro-Generating Company - RusHydro, INN 2460066195, Krasnoyarsk region. In 2018 net assets of the company amounted to 851 billion RUB.

The smallest size of net assets in TOP-1000 had JSC BOGUCHANSK ALUMINIUM SMELTER, INN 2465102746, Krasnoyarsk region. The lack of property of the company in 2018 was expressed in negative terms -41 billion RUB.

For the last five years, the average values of TOP-1000 net assets showed the growing tendency (Picture 1).

Picture 1. Change in average net assets value of ТОP-1000 companies in 2014 – 2018

For the last five years, the share of ТОP-1000 enterprises with lack of property is growing (Picture 2).

Picture 2. The share of enterprises with negative net assets value in ТОP-1000

Sales revenue
In 2018, the total revenue of 10 largest companies amounted to almost 45% om ТОP-1000 total revenue (Picture 3). This fact testifies the high level of capital concentration.

Picture 3. Shares of TOP-10 in TOP-1000 total revenue for 2018

In general, the growing trend in sales revenue is observed (Picture 4).

Picture 4. Change in average revenue of TOP-1000 in 2014 – 2018

Profit and loss
The largest company in terms of net profit is JSC Mining and Metallurgical Company NORILSK NICKEL, INN 8401005730, Krasnoyarsk region. In 2018 the company’s profit amounted to 165 billion RUB.

For the last five years, the average profit values of TOP-1000 show the growing tendency (Picture 5).

Picture 5. Change in average profit of TOP-1000 in 2014 – 2018

Over a five-year period, the average net profit values of ТОP-1000 show the growing tendency, along with this the average net loss is decreasing (Picture 6).

Picture 6. Change in average net profit/loss of ТОP-1000 companies in 2014 – 2018

Main financial ratios
For the last five years, the average values of the current liquidity ratio were higher than the recommended values - from 1,0 to 2,0, with growing trend (Picture 7).

The current liquidity ratio (ratio of total working capital to short-term liabilities) shows the sufficiency of company’s assets to meet short-term obligations.

Picture 7. Change in average values of current liquidity ratio of TOP-1000 companies in 2014 – 2018

For the last three years, the high level of the average values of ROI ratio with growing trend is observed (Picture 8).

The ROI ratio is calculated as a ratio of net profit to sum of stockholder equity and long-term liabilities and shows the return from equity involved in commercial activities and long-term borrowed funds.

Picture 8. Change in average values of ROI ratio in 2014 – 2018

Assets turnover ratio is the ratio of sales revenue and company’s average total assets for a period. It characterizes the effectiveness of using of all available resources, regardless the source of their attraction. The ratio shows how many times per year the full cycle of production and circulation is performed, generating the corresponding effect in the form of profit.

For the last five years, this business activity ratio demonstrated the downward trend (Picture 9).

Picture 9. Change in average values of assets turnover ratio of TOP-1000 companies in 2014 – 2018

Small businesses
49% of ТОP-1000 companies are registered in the Unified register of small and medium-sized enterprises of the Russian Federal Tax Service. Herein, their share in TOP-1000 total revenue is about 8%, which is significantly lower than the national average value (Picture 10).

Picture 10. Shares of small and medium-sized enterprises in ТОP-1000

Main regions of activity
ТОP-1000 companies are unequally located across the country and registered in 6 regions of Russia. Almost 90% of the largest enterprises in terms of revenue are located in Krasnoyarsk and Irkutsk regions (Picture 11).

Picture 11. Distribution of TOP-1000 revenue over the territory of the East Siberian economic region of Russia

Financial position score
An assessment of the financial position of TOP-1000 companies shows that the largest part have above average financial position (Picture 12).

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

Solvency index Globas
Most of TOP-1000 companies got superior/high or strong/medium Solvency index Globas, this fact shows the ability of the companies to meet their obligations in time and fully (Picture 13).

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

Industrial production index
According to the Federal Service of State Statistics, there is a downward trend in the industrial production index in East Siberian economic region of Russia during 12 months of 2019 – 2020 (Picture 14). Herewith the average index from month to month amounted to 101%.

Picture 14. Average industrial production index in East Siberian economic region of Russia in 2019-2020, month by month (%)

According to the same data, the share of enterprises of East Siberian economic region of Russia in the amount of revenue from the sale of goods, works, services made 3,472% countrywide in 2019, that is higher than in 2018 (3,352%).

Conclusion
A complex assessment of activity of the largest companies of real economy sector in East Siberian economic district of Russia, taking into account the main indexes, financial ratios and indicators, demonstrates the presence of positive trends (Table 1).

Table 1. Favorable and unfavorable trends, assessment factors

Trends and assessment factors	Relative share, %
Growth/drawdown rate of average net assets value	10
Increase / decrease in the share of enterprises with negative net assets	-10
The level of competition / monopolization	-10
Growth/drawdown rate of average revenue	10
Growth/drawdown rate of average net profit (loss)	10
Increase / decrease in average net profit of companies	10
Increase / decrease in average net loss of companies	10
Increase / decrease in average values of current liquidity ratio	5
Increase / decrease in average values of ROI ratio	10
Increase / decrease in average values of assets turnover ratio, times	-10
Share of small and medium-sized businesses by revenue more than 22%	-10
Regional concentration	-10
Financial position (the largest share)	10
Solvency index Globas (the largest share)	10
Industrial production index	-5
Dynamics of the share of enterprises in the total amount of revenue countrywide	10
Average value of factors	2,5

favorable trend (factor), unfavorable trend (factor).

Steel is one of the most requested metal alloys in modern industry. Its` basic components are iron and carbon. Unique balance of hardness and plasticity made steel suitable for production of wide range of items, and large amount of iron ore, available for mining, made it widespread thanks to relatively low prime cost.

Global production of steel in 2019 made 1,9 billion tones, whereof Asian countries made 1,3 billion tones, including China – 1 billion tones, where about 53% of the global production is concentrated. In Russia steel production achieved 71,6 million tones or 3,9% of the global amount, our country takes 5-th place in terms of this indicator.

Milestone at steel market, as well as for other raw materials, is spreading trade warfare between the USA and other countries, including China. Drastic protective measures, imposed by the USA, became the reason of market volatility growth. Absence of clear prospects prevents companies from stable planning and investments in production. On the back of collapse of industrial production in the PRC and other countries caused by coronavirus pandemia, demand for steel will decrease. In this case, not only steel manufacturers, but also leading metal traders will be rebound.

About 40–45% of metal products is sold by metal traders of Russia, the rest amount is sold directly by steel manufacturers, including via online-platforms, whereas domestic consumption of steel products is estimated at 35 million tones, the same amount is supplied for export.

In table 1 the largest metal trading companies of Russia are presented. The analysis demonstrates that the market is not monopolized: many players exist with commeasurable indicators. Data of the latest available financial accounts show growth of annual revenue of leading metal traders on 20% at average. Taking into account recent events and current macroeconomic environment, position of trading houses will get worse because of decrease of demand for steel caused by oncoming global economic downtown.