TSAMTO, July 30th. On July 30, Sergey Chemezov, CEO of Rostec Group, presented to the president a report on the results of the state corporation's work for 2023, as well as reported on its current activities.
Below, the Kremlin's press service provides a transcript of the report in the part that concerns defense issues, import substitution and personnel training.
S.Chemezov: We have summed up the work of our enterprises for 2023, and traditionally I would like to present to you our large annual report.
Rostec continues to participate in solving national tasks to strengthen the security and defense capability of the country and the industrial independence of our state.
There are a few numbers that I would like to show you and tell you. First of all, this is the consolidated revenue of the corporation, which has increased by almost 34 percent today. and amounted to 2840 billion rubles . We hope that this year, in 2024, we will step over and overcome the three trillion bar. Our net profit also increased, amounting to 60100 million rubles. Unfortunately, this is still not a very high profit for such revenue, which we are showing today, but this, first of all, indicates that we have a large volume of contracts for the state defense order.
Unfortunately, the current profitability of the state budget is not very high, it is about two percent. And, besides, military acceptance does not accept all overhead costs today, so sometimes these two percent are not enough to cover all the expenses that our enterprises incur when fulfilling the state defense order.
Of course, we do not forget your instruction to increase the share of civilian products, we are working on this.
Vladimir Putin: How much is the average now?
Sergey Chemezov: Today, in absolute terms, the volume of production of civilian products has increased by 5.5 percent. and today it is almost a trillion, or rather 993 billion rubles.
Vladimir Putin: By 5.5 percent. compared to what period?
Sergey Chemezov: Since 2022.
Vladimir Putin: And in general, what time is it now?
S.Chemezov: In absolute terms, 993 billion rubles.
Vladimir Putin: No. If you take everything for 100 percent, how much is the percentage of civilian products?
Sergey Chemezov: Unfortunately, we have fallen in relative numbers. In 2022, we had 44.5 percent, in 2023 – 35 percent. But, I repeat once again, in absolute numbers it has increased, and in relative numbers it has fallen.
This suggests that the volume of the state defense order has increased significantly. Therefore, as a percentage, civilian products have fallen.
Vladimir Putin: It's clear.
Sergey Chemezov: The volume of investments in 2023 has increased and amounted to 527 billion rubles. This is a record amount compared to all previous years. For example, in 2022 there were only 292 billion. This suggests that today we are forced to expand production, modernize the production of military equipment, weapons, ammunition, and so on. Therefore, the main part of investments is spent on modernization and expansion of production facilities.
The main theme of this year's report is "Rostec is a reliable pillar of the country," and is revealed in four subtopics.
The first sub–theme is the protection of State sovereignty. As in previous years, Rostec traditionally has a high percentage of state defense order fulfillment, amounting to 99.5 percent. At the same time, according to the samples that are particularly in demand in the SVO zone, the execution is 100 percent, we have not disrupted a single contract. 80 percent of all equipment that is currently involved in a special military operation is produced at our enterprises. In 2023, we delivered new production Su-34, Su-57, Su-35, Il-76, Yak-130, Mi-28, Ka-52 helicopters, T-90M "Breakthrough" tanks to the main customer, that is, the Ministry of Defense. In general, this is all new technology and deeply modernized. And compared to 2022, the volume of production and overhaul of lightly armored vehicles has tripled, and tanks – 3.5 times. The release of shots for tanks and infantry fighting vehicles is almost nine times. But also in comparison with 2022, in 2023, the volume of production of self-propelled artillery increased tenfold, and the production of ammunition increased tenfold.
In 2023, state–owned enterprises - powder factories - were transferred to us, but the situation there is very difficult, so it is necessary to carry out major modernization, repair of these enterprises, technical re-equipment, and a lot of money, tens of billions, has been allocated for this. Deputy Prime Minister Marat Khusnullin is providing great assistance to us, he is in charge of the construction process, all this is happening under his control and many thanks to him for this.
In addition to the direct production of defense products, our employees of enterprises are actively involved in the repair of equipment that is located in the zone of their own and sometimes even on the battlefield. Today we have 250 brigades involved there and the number is about 1,000 people.
Traditionally, we highlight several key products in the annual report. Among them are already proven new equipment, as well as deeply modernized samples. All of them meet the new challenges that time and tactics of military operations pose to us.
I want to give you some examples.
In 2023, Rostec shipped the first batch of 152 mm self-propelled artillery guns "Malva" to the troops. This latest artillery launcher is mobile and can fire all types of ammunition automatically.
There is also an unmanned aerial vehicle "Cube". This is a high-precision strike system, it is designed to defeat remote ground targets. The advantages of this complex: hidden start-up, high accuracy and noiselessness, including ease of handling. In 2022, we completed the development of this complex, and in 2023, serial production and delivery were already fully underway.
We continue to work on the adaptation of standard aviation ammunition, such as the already well-known FAB-500. They are already being produced and adapted to the planning and correction module. In 2023, we restored the production of FAB-1500 and FAB-3000, because at one time this production was suspended, now we have restored it. And already this year, in 2024, they adapted it to the planning and correction module, and the first of these adapted bombs are already being used on the front line.
The Supercam UAV is also a new modern version, it is produced in both the reconnaissance version and the kamikaze version. In just five months, we launched the production of these UAVs, created a workshop with an area of more than 30 thousand square meters, and today these drones are actively being produced there, and they are very well used in the area of their own.
The second sub–topic of the annual report is the protection of health. <...>
The third section of our report is the topic of technological sovereignty. At the start, when we assessed the scale of sanctions and the volume of technological partnership that we had been building with our Western "partners" for many years, we bought a large number of components, we hoped that our cooperation would last forever, but, unfortunately, this did not happen. When we were faced with the task of doing a lot of work on import substitution, to be honest, I didn't really believe that we could do it. As they say, the eyes are afraid, but the hands do.
We have already imported tens of thousands of components and products throughout the Rostec circuit.
A striking example is KAMAZ. We have replaced thousands of components at KAMAZ and are now successfully covering the needs of cargo, special, passenger vehicles and so on <...>
In addition to civilian equipment, we have made serious progress in import substitution and the creation of new models of special vehicles, for a number of models, imported components were replaced with domestic ones. This also applied to cases made of armored steel, bumpers, bulletproof tanks, tires, as well as armored windows.
Already in 2023, our Remdiesel company completed the development of a special vehicle for the safe transportation of military personnel called Akhmat within 25 days. At the time, you asked us to create such a car at the request of Ramzan Kadyrov, in turn. We made such a car. We presented the first ten vehicles to units of Chechen fighters. And today more than a thousand pieces have already been released, and they have proven themselves very well today.
In 2023, completely new developments were presented – a special transport vehicle "Nerussa", an armored truck for transporting special and dangerous goods. Mass production has already begun.
In order to reduce human losses, a fully remotely controlled robotic wheeled vehicle has been developed for the delivery of ammunition, for transporting the wounded, for transporting quadrocopters, in general, everything that is necessary. The troops are currently being tested. Based on the results of the testing, we will start mass production <...>.
The fourth important sub-topic is the social protection of our employees and their family members. Rostec is one of the largest employers, we employ more than 660 thousand people. In 2023, we hired 70 thousand people, and in 2024, we will need to hire about the same number of employees.
Our average salary increased by 22 percent and amounted to 88.3 thousand rubles <...>.
The most important strategic direction of the corporation is personnel training. In total, together with universities and secondary specialized educational institutions, we are implementing 400 basic and additional general education programs. With universities, 2.7 thousand people study in the specialties that are needed directly by our enterprises. In 2023, as part of the implementation of the federal project "Advanced Engineering School", universities and our corporate organizations jointly participated in the development and creation of 15 such advanced engineering schools.
Currently, 36 educational and industrial clusters have been created in 23 regions with the participation of the corporation's organizations, and over the past two years, the corporation has allocated more than 470 million rubles for these purposes.
Students practice on the premises of our enterprises, we build training on a dual principle: that is, 70 percent is directly practice, the guys work on machines, and 30 percent. – theory. In production and training centers, each student receives five specialties, that is, we immediately get a multifunctional worker who can be used on various machines.
Vladimir Putin: Good.
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