Management of Rakhat comments on information published in Kazakhstan's press

/KASE, March 13, 15/ – Rakhat JSC (Almaty), whose shares are officially listed on Kazakhstan Stock Exchange (KASE), has provided KASE with the following press-release: quote Recently, there was a number of news in Kazakhstan's press stating that more than 500 employees of Rakhat JSC are on forced leave. This information has been somewhat exaggerated and does not correspond to the real situation. The company's management during a briefing session gave their comments on the situation. Since last year, the company's production facilities have been continuously operating. Since the beginning of 2015 due to the sales slowdown the company was forced to reallocate production volumes and move the planned repair of several plants from the summer time to February in order for the staff to perform other duties. The company has signed a memorandum of social partnership closed between Rakhat JSC, Almaty labor union and Medeu regional Akimat regulating relations between employers and employees and defending the interests of employees. Any company, any businessman shall tune its business in line with the current market situation. Rakhat JSC operates on the basis of the approved budget, and shall take all measures necessary for its implementation. For example, in order to ensure the smooth functioning of the production process and avoid overloading of warehouses and what is important, to ensure the competitiveness of product prices as compared to the cheap prices offered by Russian producers, the company had a number of advertising and marketing campaigns in the form of discounts for certain groups of confectionery. In the second half of February of this year, a program of anti-crisis measures has been developed and adopted which plans to cut operating expenses and postpones some projects to a later date. It should be noted that despite the current economic situation, the company still continues the project aimed at launching new additional production lines in Shymkent. It is scheduled in September of this year to launch a new biscuit plant and create 100 new jobs. The project in question is the first stage of the investment project to organize the production site in Shymkent to make as much as 50 thousand tons of confectionery products per year. With limited funds available, we were happy to take advantage of the program voiced by the Head of State and being implemented currently to support domestic producers in the form of funding provided by Development Bank of Kazakhstan through commercial banks at 6% per annum. This was a very timely and significant support to our business. In the last two months the sales slowdown compared to the same period last year made more than 7%. In this situation, we can talk about redistribution of demand towards cheaper goods – the consumer preferences are quite reasonable and logical. Therefore, the company makes every effort to duly compete with Russian producers. In order to solve our problems we are assisted by the business support and development state programs; on the part of the National Chamber of Entrepreneurs and Almaty Department of Entrepreneurs. unquote [2015-03-13]