Moscow. August 5th. INTERFAX - Andrey Yelchaninov, First Deputy Director General of Roscosmos, spoke in an interview with Interfax about the financial policy of the state corporation, the prospects of the Vostochny cosmodrome, Russia's transition to mass satellite assembly and international cooperation.
- Andrey Fedorovich, how can you assess the financial condition of the state corporation at the moment?
- There is a process of gradual recovery from the financial crisis, and it is not easy. By the end of 2023, the industry is still recording a loss of about 14 billion rubles. This is primarily due to the need to complete work on unprofitable contracts concluded in 2012-2014, as well as the refusal of unfriendly countries from projects after the start of their own and, accordingly, the loss of profits. Let me remind you that the refusal of unfriendly states from contracts cost Roscosmos 180 billion rubles. So we have to build a new economy in harsh conditions.
- What were the financial indicators for the industry two years ago and now?
- The planned loss of the industry in 2022 was projected at the level of at least 50 billion rubles. We have reached the figure of just over 17 billion.
The same systematic work was continued in 2023: we reduced the planned loss from 45 billion to 13.9 billion rubles.
The annual decrease in losses of the state corporation in the period from 2021 to 2023 is largely due to the improvement of the discipline of fulfilling contractual obligations, including the completion of overdue contracts. In addition, the management of the state corporation carries out work with enterprises to improve the efficiency of their activities, which also contributes to improving consolidated business results.
The systematic reduction of the loss is accompanied by an increase in revenue by more than 40%.
In 2024, the Director General of the state corporation, Yuri Borisov, set us a clear task: to bring the industry to breakeven as much as possible. This will require the concentration of all resources, both labor, financial, and technical.
- What is the main source of loss for enterprises?
- The main reason for the losses of industry enterprises in recent years is the closure of long-term contracts for research and development (R&D), the deadlines of which have been repeatedly postponed. At the same time, the cost of work increased significantly due to the rise in the cost of materials and components, as well as the mass of overhead costs written off to the contract for a longer time of its execution. As a result, some of the costs are not covered by the contract price, which leads to losses.
And the second reason is the economics of executing government contracts. The amount of advance payments from the customer for a number of key contracts is small, enterprises are forced to take out loans, and you know the level of interest rates for previous years. Servicing loans at the expense of potential profits brought them not even to zero, but to minus. And realizing this, the government decided several years ago to compensate reasonable losses of enterprises. This applied to the entire defense industry, not just space. You will remember that Yuri Borisov, as Deputy Prime Minister of the Russian Federation at that time, was the initiator of the process of financial recovery of defense enterprises.
- How do the most important rocket and satellite manufacturing enterprises in the industry feel, such as RSC Energia, NPO Energomash, the Khrunichev Center, and the NGO named after Lavochkin?
- Enterprises operating on the international market are experiencing certain problems, but their financial and economic condition has been stabilized thanks to the support of the government of the Russian Federation.
NGOs Energomash, Proton-PM, RSC Energia and the Khrunichev Center are in the process of financial rehabilitation, received subsidies from the state several years ago to ensure sustainability, and are now looking for new markets, additional workload. Naturally, the emphasis is on the unconditional fulfillment of previously concluded contracts.
RSC Energia has already achieved a positive financial result in 2021. And in today's difficult situation with international orders, the organization remains profitable.
- What are the leading companies in terms of profits now?
- Today, half of the organizations of the perimeter of the state corporation are profitable, among them such key ones as RSC Energia, RCC Progress, MIT, Votkinsky Zavod, RKS, NPCAP and TsNIIMash. The consolidated EBITDA value is 9.8 billion rubles, which is 33 billion rubles better than the level of 2021. The net profit margin is now negative, but the plans for 2024-2025 are to reach acceptable values. As a result of optimization measures, it is planned to bring at least three quarters of our enterprises to break even and further improve this indicator.
TsNIIMash stands firmly on its feet. Agat also shows a good economy, it is an industry institute that forms forecast models, deals with valuation and pricing, issues conclusions for all processes, for investment projects.
- Do you continue the practice of attracting loans? Which banks do you work for?
- The main partner of Roscosmos is PSB. We work closely with the bank. In particular, PSB provides a loan on preferential terms for our Reshetnev enterprise to start production of another Yamal-501 satellite. It provides radio broadcasting services to remote areas of Russia.
But in general, we work with everyone, and we see BEAC, VTB, and VEB among the most reliable partners.
- How would you assess the readiness of Roscosmos to build a Russian orbital station?
- The construction of a new national station, which will replace the ISS, is an anchor project for the industry. We have started it. We are consolidating the industry around ROS. We optimize the workload of enterprises and the entire cooperation. We hope for stable financing of the project from the state. Because while the financing is clear for three years, I would like more clarity further.
The station's deployment is planned to begin with the launch of the scientific and energy module in 2027. The core of the station is planned to be created from four modules put into orbit in the period up to 2030: scientific and energy, universal node, gateway and base. At the second stage, in the period from 2031 to 2033, it is planned to expand the station by connecting two target modules.
- In October 2022, the Skif-D demonstrator was launched into orbit. What is the stage of the experiment? And what is the future of the Sphere project?
- Skif-D successfully defended the orbital frequency resource of the Skif group, which is part of the federal Sphere project. The domestic payload used on the satellite has received flight qualifications, and control and data transmission technologies have also been successfully tested.
All the tasks set as part of the experiment have been completed. The characteristics of the experimental spacecraft correspond to the design ones. Testing of broadband access technologies and control systems of the device in various modes will continue throughout the entire period of active existence of Skif-D.
In terms of content and functionality, the Sphere satellite grouping surpasses all previously created in Russia. The Federal Sphere project will be developed within the framework of the National Project for the Development of Space Activities of the Russian Federation for the period up to 2030 and for the future up to 2036, which is currently being developed.
- The CEO of Roscosmos often says that Russia should move to the conveyor production of satellites. What kind of work is being done and when can this be achieved?
- We assessed the capabilities of our enterprises for the conveyor production of satellites and stopped at two sites - Reshetnev in Zheleznogorsk and NPO im. Lavochkina in Khimki. We will distribute the production of different satellite lines among them within the framework of the Sphere project.
At the NGO named after. Lavochkin is already implementing a pilot project for the manufacture of three satellites, which then potentially should be on the streaming line. Two of them have an optoelectronic load, one will be with a radar.
Satellites providing the Internet of Things and broadband Internet access will be industrially assembled at Reshetnev. These are the Skif and Marathon-IoT projects. The first two Marathon satellites are due to fly at the end of this year. At the same time, Reshetnev is modernizing production in order to reduce the production time of classic heavy spacecraft for GLONASS and Gonets systems.
- Is the amount of costs for the transition to mass production of spacecraft clear?
- We calculated the amount of necessary investments, including equipment, realizing that this is a long and expensive process. So far, we have stopped at the fact that it is advisable to switch to the conveyor in two stages. At the first stage, we start manufacturing about a hundred and a little satellites per year, then we expand our capabilities and debug technologies.
- What year are you planning to implement the project?
- We expect to start commercial satellite assembly in 2027. This is the first stage when we maximize the capacity of existing enterprises. We are importing new equipment and opening new lines. If these capacities are not enough, we will begin construction of new sites by 2030.
- Are there any growth points for export opportunities in the creation of satellites and their launches for a foreign customer? And is it possible to return the pre-sanction volume of export revenue to the state corporation?
- After the start of our joint venture, we had to reorient ourselves from our traditional partners in Europe and the United States, with whom we had long-term relationships, to new international destinations, including countries in Africa, the Middle East, and Southeast Asia. In addition, the traditional product line has been expanded.
As for the return of the pre-sanction volume of exports. We set ourselves such a task. But this is a long-term game, as in all new markets with great competition. But if we enter them correctly, the prospects are the best.
- Does Roscosmos independently promote export contracts?
- Yes, first of all through the Glavkosmos company, specially created in the perimeter of the state corporation for such tasks.
- What new can Roscosmos offer in the Milky Way project? The United States has a similar system.
- We propose to create a supranational system for monitoring outer space - tracking space debris and all objects. Russia has stations in various parts of the world, they work in an open format and provide data. We are actively promoting this project for cooperation, in particular with the BRICS countries.
- What do the BRICS countries say?
- They are certainly interested in it. What is more important, countries can use this project to train their specialists, train students, and develop national competencies in the space field.
- How is the cooperation with NASA going today?
- Russia has decided to continue operating the ISS at least until 2028, this implies both mixed crews and coordination of cross-flight programs. This is an active program.
As part of the contacts between the management of Roscosmos and NASA, technical issues related to the operation of the ISS are being discussed.
- During the broadcast of the launch of the American Starliner ship, the Russian RD-180 engines mounted on the launch vehicle were very clearly in the frame. Are the Americans not returning to this issue?
- This issue is not on the agenda.
- How do you assess the competition from China now? Is it hard to compete with them?
- In line with the strategic partnership of our states, the Roscosmos state corporation adheres to the position that it is necessary not to compete with China, but to cooperate.
- How are the joint projects with China progressing?
- The key project of our bilateral cooperation is the creation of an International scientific lunar Station, to which we jointly strive to attract other international partners.
- Russia is creating another promising Soyuz-5 launch vehicle for launches from the Baiterek launch site at the Baikonur cosmodrome. Are there any plans of the Kazakh side to continue the project?
- The Baiterek project is at the stage of execution of concluded contracts. Soyuz-5 is being created at the Progress Rocket and Space Center and cooperation enterprises. The components are undergoing ground-based experimental testing.
- Is the construction of the launch complex at Baikonur under way, for which the Kazakh partners are responsible?
- Design documentation is being developed based on the preliminary design. In May, at a meeting between Roscosmos CEO Yuri Borisov and Minister of Digital Development, Innovation and Aerospace Industry of Kazakhstan Zhaslan Madiyev, an agreement was reached to continue work. The project is alive and developing.
- In April, the first launch of the Angara-A5 rocket was carried out at the Vostochny cosmodrome. How do you rate this start?
- Vostochny is Russia's main platform for access to space. It was gratifying to see the launch of Angara, which, although not on the first attempt, still took place. Let me remind you that the launch took place as part of flight design tests. The functionality of the new start table has been confirmed. It is also planned to launch manned launches to the Russian Space Station from it in the future. The launcher program will be developed.
- It is planned to build a launch pad for the promising Amur-LNG rocket with a reusable first stage at the Vostochny cosmodrome. Have you already chosen a place for construction?
- After the reconnaissance, a place was chosen for the construction of the launch complex, and several locations were also identified for landing sites for the returned first stage.
The project is a landmark for the industry, it is our tactical perspective for the next 30 years. The savings from replacing Soyuz-2 with Amur-LNG may exceed 2 trillion rubles during the period of operation of the new space rocket complex. From the very beginning, the development is based on the principles of start-up cost management. Key design solutions are aimed at technical and economic indicators. Reusability, fuel components that ensure minimal costs during inter–flight maintenance are just some of the solutions that ensure the effectiveness of the future rocket.
- How are you planning to land reusable steps?
- The development of a technical project is underway, as well as the development of engines as part of the development work of DU SV. We intend to work out the landing of the stage in two stages. At the first stage, experimental work is underway to return the first stage to the demonstrator stage, without creating a full-fledged ground-based space infrastructure of the cosmodrome and without manufacturing the entire launch vehicle. This will allow us to work out key technical solutions at the lowest cost and will fundamentally accelerate the development process throughout the complex. And at the second stage, it is planned to proceed to the full-fledged testing of the stage and the launch vehicle as a whole.
- It is also planned to launch a fully reusable Korona launch vehicle at Vostochny. What stage is this project at?
- Korona is a single-stage fully reusable rocket based on oxygen-hydrogen components. This is a visionary work from a long-term perspective. Single-stage rockets require unique characteristics and design and technological excellence.
The most complex engines with a central body capable of operating both in terrestrial conditions and in a vacuum, unique control systems and fundamentally new materials that ensure reusability, fundamentally new layout schemes are the key scientific and technical problems that we are currently working on.
We have carried out technical and economic assessments to determine whether the new carrier will be in demand. The answer is obvious - we will reduce the cost of access to space by more than an order of magnitude and open up completely new opportunities for super-operational cargo delivery and move on to the ideology of serviced space.
At the moment, the Makeeva Research Center is conducting research work to confirm the key technologies for creating a single-stage fully reusable launch vehicle, as well as to confirm design and engineering studies. Based on the results of this work, a decision will be made on the expediency of continuing the work, as well as on the achievability of certain solutions.
- How many more construction queues are planned for the cosmodrome?
- Due to geographical features, launching payloads into low-latitude orbits from Vostochny will be fundamentally more efficient than from another Russian spaceport Plesetsk. In this regard, the ground-based space infrastructure of almost all promising civil and dual-use space rocket complexes will be located at the cosmodrome. Accordingly, it is not possible to talk about the finiteness of the construction of the Vostochny cosmodrome queues.
The promising space rocket complexes Angara, Amur-LNG, Start-1M, Korona, the development of aviation and other types of transport, the production and preparation of various rocket fuel components and other facilities form not just "queues" for the development of the cosmodrome, but a continuous process of development of space and civil infrastructure in the region.
If we talk about the timing of the creation of launch pads for promising launch vehicles, then everything will strongly depend on the resource provision of these events. The creation of promising space rocket complexes based on new fuel components is now combined into the federal project "Methane-N2", which is being considered by the Government of the Russian Federation. Based on the results of the review, it will already be possible to predict specific deadlines for the creation of facilities.
- Is there a final appearance of the Vostochny cosmodrome or will it be constantly being built like this?
- There is a master plan for the development of the cosmodrome. But we are working stepwise, building up our capabilities.
To complete the second stage of construction (without Amur LNG and without Korona), approximately 50 billion rubles will be required.
In addition, we are engaged in the construction of an airport complex. We have almost everything ready, the strip is ready.
- When will it start accepting civilian aircraft?
- The final commissioning of the runway is scheduled for the 4th quarter of 2024. This is expected, first of all, by the Cosmonaut Training Center and air transport companies providing delivery of space cargo.
If we talk about non-space transportation, one of the oil and gas companies has repeatedly expressed interest in using our runway by aircraft carrying their personnel. Also, given the plans to develop tourism at the cosmodrome, we see prospects in using the strip for these purposes.
- What is the tourist flow in the East now and what are the prospects?
- In 2022, immediately after the pandemic, 3.2 thousand tourists visited the cosmodrome. In 2023, the tourist flow increased to almost 4 thousand people. The plans for 2024 include 4.6 thousand tourists.
So far, these are rather modest figures, due to the fact that there are not many launches and there are no manned ones yet, there is no tourist infrastructure, and during the inter–launch period, mainly local schoolchildren travel according to a program subsidized by the region - they inspect the cosmodrome in a few hours.
But in the future, with the development of the cosmodrome, the advent of manned launches and all the necessary infrastructure – from cafes to hotels and launch observation sites, we see the development of tourism on a truly large scale.
Roscosmos is working with potential investors who are ready to invest in infrastructure projects: to build hotels, cafes, leisure centers and work out additional options for leisure activities at the cosmodrome – fishing, trekking routes, paragliding and so on. Yes, it is not easy, there are certain restrictions related to the fact that both the city of Tsiolkovsky and the cosmodrome have the status of a BUT. But Roscosmos, together with security agencies, is working on possible options to reduce the time required to gain access to the territory for tourists, including foreign ones, and other nuances.
The issue of attracting an external operator with experience in the travel services market is being considered.
- Does Roscosmos have its own fleet, are you planning to upgrade it?
- There are various types of aircraft in the Roscosmos fleet, which are primarily involved in the interests of the Cosmonaut Training Center. The cosmonaut training program includes helicopter piloting, and flights on L-39 and Tu-134 training aircraft. And, of course, what is most widely covered in the media sphere is flights on the Il-76 weightlessness simulator.
Our fleet provides solutions to all tasks related to the training of astronauts and ensuring the activities of the state corporation and enterprises in its perimeter. We cannot afford new planes, but we expect to take those that have already flown.
- What is the share of civilian products in the enterprises of the state corporation?
- By the end of 2023, the share of civilian products of our enterprises amounted to 18.5%. We are talking about the manufacture of high-tech products for such industries as oil and gas, medical, transport and aviation industries.
The products are in demand by customers, as they import goods from companies that have left the Russian market. For example, JSC "UKVZ" produces modern trams, JSC "NPK "SPP" has developed an electronic prosthesis of the lower extremities at hip level "Active-2", which is not inferior to foreign analogues. MIT Corporation has completed industry tests with Gazprom Neft PJSC of the domestic fleet for hydraulic fracturing, the main method of increasing oil recovery, without which the development of most fields is impossible. VNIIEM Corporation and NPO Avtomatiki JSC are developing automated multifunctional systems for controlling the reactivity and power of a nuclear power plant reactor. Turbopump JSC manufactures import-substituting pumping and processing equipment for ferrous and non-ferrous metallurgy, pipeline transportation of oil, production and processing of hydrocarbons.
