Meeting of Russian President Vladimir Putin with United Shipbuilding Corporation CEO Alexei Rakhmanov
Vladimir Putin held a meeting with Alexei Rakhmanov, Chairman of the Management Board and CEO of the United Shipbuilding Corporation. The President and the CEO discussed the company’s current operations.
President of Russia Vladimir Putin: Mr Rakhmanov, let us talk about the state of affairs in the corporation in general and about your plans.
CEO of the United Shipbuilding Corporation Alexei Rakhmanov: I have prepared a package of documents, Mr President. Essentially, these are performance results and charts that provide a good picture of the corporation’s geography.
Our operations have been stable for the past six years, including three years of steady profitability when it comes to company operations. Our net profit remains around one percent but this is due to the fact that the state defence order still accounts for 83 percent of our revenue.
Our employees’ wages are paid regularly and they tend to rise by around seven percent a year, taking into account the fact that output, labour productivity and, basically, people’s ability to make a decent living are growing proportionally.
I must also note that overall, we are paying around 8,000 to 9,000 rubles extra on the region’s average wages for specific categories because the wages at our facilities involved in engineering and design are higher than the average wages in production. At the same time, we are making great efforts to retain the workforce. The workforce is our greatest asset.
Of course, from this perspective, the measures we have been taking even during this difficult year help us to have confidence that our programmes will be carried out consistently.
Vladimir Putin: Wages in your company are growing steadily.
Alexei Rakhmanov: By around seven percent a year. In 2017, 2018 and 2019 wages grew at a rate of around 70 to 80 percent of the inflation rate but right now we are also taking increasing labour productivity into consideration, which results in figures just over the inflation rate but still within the limits of 7.5 to 7.8 percent. Of course, this is an important factor helping us to retain staff.
Regarding our key projects, of course, our main focus is on fulfilling the state defence order. We currently have 50 military ships under construction. This year, we have already commissioned the Knyaz Vladimir lead cruiser into service. The trial run was completed last year but we needed four more months to prepare it for its final transfer to the Navy.
In 2020, we plan to launch 14 combat ships, which is a record number for us even compared to the Soviet period. In Soviet times, we launched six submarines per year and now, in 2020, we are not so very far away from these figures. We hope to deliver at least three and, hopefully, even four submarines to the Navy because this is indeed a very intensive programme.
Our civil shipbuilding projects are also moving forward consistently. We have some impressive products to offer when it comes to civil equipment. Since we received your instructions to increase the share of civil production, our company has been boosting civil equipment production by an average of 30 percent every year. In 2019, our civil output was worth 58 billion rubles. In 2020, we expect to generate revenue of 92 billion rubles, reaching the two-percent advantage in the balance of military and civil production by 2030 that you set as a goal for our corporation.
What is most important is that we see a huge market. The entire scope of orders from Russian clients significantly exceeds our current plans and is close to 511 billion rubles. This is actually a serious challenge for us.