2012

Investment project of OSB production in Buj of Kostroma region

Project description

2

Project target is construction of OSB production plant in Buj (Kostroma region) with annual capacity of 400 thousand cub. m using modern technologies and equipment.

Planning period is 8 years. Start of production is scheduled for the 1st quarter of the third year, reaching for the production

capacities – for the 6th year of project realization.

Investment project production plan involves production of board with thickness from 6 to 40 mm of basic format of 1 250*2 500 mm.

Annual volume of raw materials consumption is 440 thousand m3 for the capacity of 200

thousand m3 and 880 thousand m3 for the capacity of 400 thousand m3. Raw materials are partially prepared at the own timber production, partially – are purchased from indirect logging enterprises.

Project value - 5 470 000 thousand RUR (excluding VAT)

Financial sources:- 20 % of own funds;- 80 % of borrowed funds.

- favourable investment climate;

- advantageous geographical location;

- availability of transit transport network;

- low level of social conflicts.

Location

3

Production capacity – 400 m3 of boards per year

Total number of workers - 366

Average salary – от 26,7 тыс. рублей

Payback period – 6 years

Kostroma region administration is ready to provide the most favoured nation treatment for the investment project in part of exemption from payment of the following taxes payable to the regional budget during the payback period:

- exemption from payment of property tax;- reduction of the rate of profit tax from 18% to 13,5%.

Brief information about the project

Project efficiency indicators

4

IndicatorWith privileges, thousand

roublesWithout privileges, thousand roubles

Revenue (excluding VAT) 22 733 409,60 22 733 409,60

Paid for suppliers and employees 8 830 309,37 8 830 309,37

EBITDA 13 903 100,23 13 903 100,23

Depreciation 2 639 334,11 2 639 334,11

Paid taxes 2 041 628,77 2 552 550,75

Interests on loans 1 735 167,78 1 735 167,78

Net profit 7 486 969,58 6 976 047,60

NPV 2 058 529,70 1 748 544,45

IRR, % 23,95 21,88

Project economic efficiency during planning period

Project efficiency indicators

5

IndicatorWith privileges, thousand

roublesWithout privileges, thousand roubles

Federal budget, including 1 831 822,8 1 823 450,71

VAT 1 649 049,52 1 649 049,52

Profit tax 182 773,28 174 401,19

Regional budget, including 1 665 819,79 2 185 113,89

Profit tax 1 468 921,2 1 569 610,71

PIT 63 999,0 63 999,0

Property tax 132 899,59 551 504,18

Municipal budget, including 45 428,2 45 428,2

PIT 27 428,2 27 428,2

Land tax 18 000 18 000

Social payments 239 034,67 239 034,67

Total 3 782 105,46 4 293 027,47

Project budgetary efficiency

Project efficiency indicators

6