Turboatom signs joint cooperation deal with Mitsubishi

At a press conference on Friday, Turboatom (TATM) CEO Viktor Subotin said the company signed an agreement with Mitsubishi Heavy Industries to jointly produce modern 600MW steam turbines for CIS-based thermal power plants. According to the agreement, the turbines will be manufactured in Ukraine, with Mitsubishi providing relevant technology. Subotin released the company’s preliminary results for 2008: production up 15% yoy; net revenue up 40.7% yoy (to UAH 470 mln), and net income up 19.8% yoy (to UAH 41.8 mln). According to Subotin, the company plans to increase output by 13.5% yoy in 2009 to UAH 455 mln (the company’s order book is worth UAH 1.52 bln), net revenue by 15% yoy to UAH 540 mln, and net income by 7.6% yoy to UAH 45 mln. Alexander Paraschiy: As one of few power turbine producers in the world, Turboatom is insulated from sales volatility during the economic crisis: demand for power equipment is increasing, even in Ukraine and Russia (Turboatom’s main markets). The JV agreement with Mitsubishi is a sign of increasing attention by global producers to the CIS power equipment market and its mid-term potential. If the joint project succeeds, Turboatom will strengthen its position on the CIS market for steam turbines for thermal power plants (currently Russian LMZ is the leader on the market).