Mongolia Business and Mongolian Daily Business News

Q: Board Meeting of “MongolRosTsvetmet” Company was held. Was it unscheduled one?

Mr. D.Sugar: Board Meeting of “MongolRosTsvetmet” Company was held at the end of the last week. It was not unscheduled one. It was No 39 scheduled meeting.

Q: Who owns the company?

Mr. D.Sugar: 51% by the Mongolian Government and 49% by Russian Government. The meeting was held within these shareholders.

Q: Did the Russian side transfer its share to “Rostechnology” LLC?

Mr. D.Sugar: It is media scandal. I can say responsibly that the Russian Government remains the 49%.

Q: What was the main topic of this meeting?

Mr. D.Sugar: The main agenda was on first 9 months’ activity report of MongolRosTsvetmet in year 2009 and its expected outcome, Action Plan of year 2009, progress report of reformation project at Bor Undur factory and measures of the company management in the time of crisis and its next steps. Also, its mining licenses of Asgat, Bargilt, Tuin Gol deposits were discussed.

Q: Does any resolution or decision was made by the meeting?

Mr. D.Sugar: The first 9 months activity of the company was highly evaluated. Its result was truly exceptional. Its sales income was increased by 40% or 10 billion MNT if compares with the same period of the last year and its profit was increased by 700 million MNT. Production accumulated expense was decreased down to 0.77 MNT per 1 MNT. Also its employees average salary was increased up to 376 thousand MNT and labour productivity was increased by 13%. The company paid 6.8 billion MNT as income tax, resource utility fee, windfall tax and other taxes and 1.2 billion MNT as the health and social welfare insurance to the state budget. It successfully implements its Bor Undur enrichment factory project of 6.2 million US$. Therefore, the company brought the opportunity of 5.0 billion MNT as profit. Based on these data and showings, board concluded that the management was excellent.

Q: The Company will be affected by the world economy recession as well. Did you discuss any protection measures against it?

Mr. D.Sugar: Due to the global economy recession, the consumption of commodity is decreasing everywhere in the world. Therefore, of course, the company management prepared the action plan for the year 2009. According to this action plan the company will have 2.9 billion MNT profit and make 49.0 billion MNT sales. It also planned to increase its sales by 5.0 billion MNT and average salary up to 500 thousand MNT. The company will pay 5.9 billion MNT to the state budget.

The company also plans to mainly concentrate on the earth removal work and therefore, its profit will be decreased. Also its reformation project of Bor Undur factory will be finished in the next year.

Q: How shareholders will help to the management team to complete this action plan.

Mr. D.Sugar: Shareholders sides will surely provide some support in its activities. Mongolian side will resolve the issue of adopting the G2G agreement on the company’s activities by the State Great Khural. As the result of this agreement the Russian side will decrease import tax waive of 15% for the export product of the company. Also tariff and tax waive in the railway transport in Russian territory. It will surely help in increase of export price of the company products.

Related post

• S.Batbold: The State property will be privatized and distributed in shares to the people.