Club 4 Paws
Premium food for cats and dogs
My love/Gav
Standard food for dogs
My Love/ Miau!
Standard food for cats
Master
Standard food for cat and dog
Optimeal
Super premium food for cats and dogs
Kormotech is investing nearly 14 million euros to expand its production capacities over two years
The global pet food market is overgrowing, and there is already a need for more production capacities. This becomes evident when it comes to finding a partner for outsourcing or placing orders for the production of products under their brand names. We are convinced that it is crucial to invest in building brand recognition and expanding production simultaneously.
Despite a year of the war, Kormotech maintains its leadership in the Ukrainian market and produces over a quarter of the pet food sold in Ukraine. In 2022, the pet food market demonstrated a slight decline, but Kormotech continued to grow, even in the face of a declining market. The company's turnover increased by 12%, from $110 million to $124 million yearly. Working in a long-term perspective is key for Kormotech, so the company reinvests its earnings to strengthen its production capacities in Ukraine and the EU.
During 2022-2023, the company will allocate nearly 14 million euros to expand its industrial production capacities. Some of the projects have already been launched, and the rest are planned to be implemented by the end of 2023. The production capacities for wet pet food at Kormotech's plant in Kedainiai, Lithuania, are expected to increase by 25%, and in Ukraine by 65%. The company has integrated new technology at the Lithuanian plant for producing wet pet food in the premium and super-premium segments. The investments in the Lithuanian plant in 2022-2023 will total 5.4 million euros.
In Ukraine, the capacities of the wet pet food plant are currently being expanded, 50% of the existing equipment is being modernized, and manual processes are being automated. 2023 the company plans to update the dry pet food plant. The total investment in both Ukrainian projects by the end of 2023 will amount to approximately 8.5 million euros.
Kormotech is also working on improving the efficiency of its existing production and business processes. In 2022, we began implementing the "Zero Waste" program to reduce all irreversible losses of the enterprise to "zero" or classify them as secondary processing. A complete energy audit of the production has been conducted, focusing on heat recovery, thermal insulation, and energy consumption monitoring systems. Kormotech has launched the SAP ERP cloud system, which will help focus on innovation, reduce operating costs, and improve process efficiency.
In 2022, the company started a nationwide initiative called "Save Pets of Ukraine" to rescue animals affected by the war. Kormotech provided 200 tons of self-produced food for dogs and cats. Under the patronage of the initiative, a global assistance network has been formed, bringing together charitable organizations and businesses in different countries around the world. The initiative has received over 30,000 requests for assistance, delivered 1,000 tons of food, and fed over 250,000 dogs and cats while also providing shelters with generators, heaters, and vaccines. Save Pets of Ukraine now focuses on providing comprehensive support to shelters.
As a result of the first year of the war, Kormotech entered the TOP-50 list of domestic employers according to Forbes Ukraine. From 2022 to the first quarter of 2023, the company created 99 new jobs in Ukraine and abroad, and 327 new employees joined the team. Kormotech continues to invest in the well-being of its employees, including corporate training programs, sports, health insurance, psychological support, and recovery programs.
Kormotech's goal in 2023 is to achieve a turnover of $150 million and increase the export/Ukraine ratio from 24%/76% to 30%/70% through synchronous market growth.