Russian business has set a record

FinExpertiza: the profitability of the Russian business turned out to be the highest in 2.5 years

The profitability of goods and services sold by Russian large and medium-sized enterprises from January to June 2021 reached a record high in 2.5 years. The ratio of profit to costs for production and sale of products was 12.5 percent, the international audit and consulting network FinExpertiza found out. The research data is at the disposal of

In their calculations, the analysts relied on Rosstat data on the financial condition of large and medium-sized organizations with an average number of employees of more than 15 people. The total profit of such enterprises in Russia amounted to 10.64 trillion rubles. The business could not achieve such a high profitability either in the crisis year 2020, or in the pre-pandemic 2019. The indicator of the first half of 2021 is only exceeded by the figures for July-December 2018, when the profit-to-cost ratio was 12.7 percent.

FinExpertiza found that the most successful business was in Karelia (product profitability reached 69, 5 percent), the Jewish Autonomous Oblast (68.3 percent), the Murmansk Oblast (62.9 percent), Tuva (50.5 percent), the Astrakhan Oblast (50 percent), the Magadan Oblast (47.1 percent), the Trans-Baikal Territory ( 46.2 percent), Sakhalin Oblast (44.3 percent), Chukotka Autonomous Okrug (43 percent) and Krasnoyarsk Territory (37.6% percent).

Elena Trubnikova, President of FinExpertiza Global, explained that the financial performance of Russian business was “pulled” by the raw materials sector (mining and manufacturing) due to high fuel prices. Financial and insurance activities, agriculture and real estate also showed good results.

Nevertheless, the profitability of most industries in Russia turned out to be below the national average values. Business focused on retail demand is currently facing outpacing growth in costs associated with accelerating inflation and higher prices for raw materials. “The post-pandemic recovery of the population's income is extremely limited, and given the increasing production costs, it would be premature to talk about the end of the coronavirus crisis in relation to private business not related to resource extraction,” Trubnikova says.

The lowest profitability was demonstrated companies of the Amur Region (loss amounted to 27 percent of expenses), Ingushetia (-20.3 percent), Chechnya (-5.5 percent), Sevastopol (-4.4 percent), Kabardino-Balkaria (-2.7 percent), Dagestan (-1.5 percent), North Ossetia (-0.9 percent), Crimea (1.1 percent), Pskov region (1.6 percent) and Ulyanovsk region (3.3 percent).

< p> In November, the Expert RA rating agency predicted that almost 30 Russian banks would disappear by October 2022. The reason for this forecast was the decline in profits due to changes in the lending market. According to the expert, 45 banks have already closed in Russia over the past year.



Leave a Reply