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Sveza reports 60% revenue increase in 2021
14 February 2022

In 2021, Sveza delivered improvements on all key performance indicators. The company demonstrated record growth in revenues, grew its customer base, increased the share of direct sales, and doubled the share of special and customized products in its product portfolio.

 

The year 2021 was a successful year for the Russian forest industry in general, and for the birch plywood sector in particular. Sveza Group, a leading Russian forest industry company and the world’s largest manufacturer of birch plywood significantly improved all performance indicators. The company reported an unprecedented revenue growth by 60% to 57.1 billion rubles.

 



Traditionally, the Russian market dominated the company’s shipping geography accounting for 20% of Sveza’s total sales, while the North American, European, and East Asian markets continued to gain importance. The markets that demonstrated the largest growth of volume taken in a year were China, South Korea, the USA, and a number of European countries. In 2021, Sveza increased the share of contracts with new customers by 97%. Speaking in terms of order volumes, the fastest-growing segments were Furniture and Interiors (+63%), Construction (+46%), and LNG (+172%). The share of direct sales increased by 9 p.p. to 25%.

 

Sveza’s production output also went up. In 2021, the company produced 1.3 million m3 of plywood and particleboard, up by 4.6% from a year earlier. Sveza continued focusing on special and customized products and in 2021 doubled the output to achieve 13% of the total production. The company put to market more than 30 new products, among them plywood products for passenger vehicles such as SVEZA Subfloor — special film-faced fire-retardant plywood for rail car and bus interiors, compliant with ECE R118.03 — and soundproof plywood SVEZA Antinoise, both products certified under relevant EAEU and EU standards.

 



Demand was unusually high in 2021 for all products in almost all markets driven by the world’s recovery from the crises of 2020. Manufacturers faced with growing demand not only for plywood, but also for particleboard and lumber. Sveza estimated that the global birch plywood market grew by 5% to 5.5 million m3 in 2021. The imbalance of supply and demand in the market resulted in an increase of product prices that stayed high for the most of the year and peaked in September. An important factor was an acute shortage of raw materials experienced by all large producers in the market combined with a more than 60% increase in the raw material prices in 2021 compared to 2020. To make matters worse, the global logistics faced a crisis: the blockage of the Suez Canal by a container ship resulted in a shortage of shipping containers and caused many disruptions in the global trade. The freight costs went up 85% on average.

 

“As challenging as it was, we were determined to fully deliver on all our commitments to the customers, and we made it. At the same time, we are celebrating record growth of our customer base, and substantial improvements in all our performance indicators, primarily an increase in the share of direct sales, and a higher share of special products in our portfolio. We will keep working hard in those areas for the success of our customers and partners,” says Anatoly Frishman, CEO of Sveza.

 



In 2021, Sveza continued to diversify its product portfolio. The company significantly increased the output of bioproducts — fuel briquettes made of birch dust. In 2020, Sveza produced 3,500 tons of fuel briquettes. In 2021, the output was more than five times more — 19,000 tons. Sveza started working on two large construction projects in 2021: a sawmill that will produce kiln-dried lumber and a pellet fuel plant. The two projects are worth 2.5 billion rubles and will be implemented in the Vologda Region.

 



The amount of taxes paid by the company to the public budgets at all levels in 2021, increased by over 80% to 6.5 billion rubles.