Total revenues of TOP 100 state-owned companies for 9 months boosted by UAH 187 bn

As a result of activities of TOP 100 companies for 9 months their revenues have grown by UAH 187 billion. Deputy Minister of Economic Development and Trade of Ukraine Yulia Kovaliv announced on 18 March, during the extraordinary Cabinet’s meeting which was summoned to consider the results of audit of major state-owned enterprises.

"Today in Ukraine there are over 3,500 enterprises, half of which operational. Now, pursuant to the law the privatization of over 1,700 state-owned enterprises have been prohibited ", said the Deputy Minister of Economic Development and Trade.

On the outcomes of the audit of TOP 100 state-owned companies, during 9 months their profits have boosted by 45%, which is UAH 187 billion, the total net asset value makes up about UAH 1 trillion, claimed the Deputy Minister.

Julia Kovaliv focused on the activities of 17 state-owned enterprises the CEOs of which were present at the Government’s meeting. In particular, she told that the best revenue performance had been demonstrated previous year by the following companies: OJSC Odessa Port Plant, SFTC Ukrinterenergo, PJSC  UkrGasVydobuvannya, SE Eastern Mining and Processing Plant. In general, the state enterprises are expected to earn UAH 2.6 billion in 2015, which is by UAH 10 billion more versus 2014, when they demonstrated losses worth UAH 7.4 billion.

The Deputy Minister stressed that, for instance, the net consolidated profit of Naftogaz this year had improved by UAH 64.8 billion UAH as compared to 2014.

However, she stressed that these results are preliminary, adding that in 2015 with its resolution the Government had ordered all major state-owned enterprises to ensure the annual audit with the top audit companies.

"Unfortunately, by now only 6 companies have conducted such audits for 2014. Another 10 have signed contracts for having such audit, while 13 companies are engaged in tenders”, said Yulia Kovaliv. Thus, half of the companies are sabotaging such activity that would have provided a real picture of the state of matters in these enterprises".

Apart from that, Yulia Kovaliv reminded a reform launched last year – which is an independent contest to fill posts of CEOs at state-owned enterprises. On the Government’s decision there was established a Nomination Committee on the appointment of company executives. We have already appointed 6 CEOs, another two have been shortlisted, there have been announced competitions for the appointment of another 6 directors .

"We now have a unique chance to show the results and those CEOs who would effectively run the state-owned companies, as apart from the transparent competition, we've introduced an opportunity to pay market-based salaries", said Deputy Minister of Economic Development and Trade. However, there are certain attempts to block this process through court decisions, it is unacceptable, she stressed.

Julia Kovaliv highlighted that to ensure transparent and efficient operation of state-owned companies the legal framework allows to engage independent Supervisory boards. Moreover, she called on CEOs of state enterprises to switch to an electronic public procurement ProZorro.