LSR Group to Launch New Reinforced Concrete Production Facilities in Moscow

26 May 2009

Vollert-WECKENMANN, a German company, has carried out the supply of vertical wall production machinery to OJSC Zavod ZhBI-6 (a company of LSR Group). Accordingly, once the machinery is installed and adjusted, Zavod ZhBI-6 that was previously specialised in manufacturing floor slabs, piles and flights of stairs, will be able to add one more item to its product-mix: vertical elements for external walls and internal wall panels. It means that in line with the operating pattern of prefabricated construction plants the company will offer to the market a complete range of modern reinforced concrete products used in prefabricated construction.

The planned capacity of the machinery to be commissioned is 35,000 cub.m of reinforced concrete per year. Consequently, the total annual output of Zavod ZhBI-6 will reach 170,000 cub.m of reinforced concrete, which is equivalent to approx. 200,000 sq.m of panel housing.  

To select the optimal technology and value for money combination, company specialists held a number of working meetings with foreign suppliers and finally opted for the machinery manufactured by Weckenmann of Germany. The carousel (circulation) line purchased for horizontal production of elements is based on a new capital-intensive technology comparable by its output to the cassette method of production. It provides an easy changeover and allows to manufacture a wide range of products including sandwich panels and decorative surface panels. Machinery installation, trial running and operating mode selection will be carried out under the guidance of Vollert-Weckenmann’s specialists.

Investments in the machinery are in excess of RUB 65 million (according to the exchange rate of the RF Central Bank as of 22.05.09). The equipment supply contract was concluded in 2007, and the expenditures under the investment contract were partly included in the financial statements for 2008.
To finance the equipment supply deal, a letter of credit was opened with the RF Northwest Sberbank in September 2007, with the LC cashed in 2009 against delivery.
In addition, the plant completed construction and installation work (namely, a shop previously unused was renovated, and the final products warehouse was substantially expanded), with the investments amounting to RUB 105 million.
The new concept of plant’s development provides for using the experience of LSR’s house building companies including the latest prefabricated construction technologies developed in St. Petersburg. It primarily includes manufacturing products for building seamless faзade houses to prevent cold bridging and leakages that frequently occur at other panel houses,  solid core house facing,  flexible design and architectural solutions, and also the ability to ensure high-speed assembling and construction of houses having from 3 to 25 floors.
Speaking about the end users – housing buyers, they are particularly concerned about the aesthetic appearance of the houses being built, their long service life, convenient layouts (big kitchens and hallways, no “pass-through” rooms, and provision of dressing rooms), high ceilings unlike in the obsolete buildings, balconies, perfect sound insulation and high speed of construction.

In order to use the new products of Zavod ZhBI-6 for constructing new residential buildings in Moscow and the Moscow region, the product line manufactured by CJSC DSK Blok (a house building St. Petersburg-based company of LSR Group) was certified in the Moscow area in 2008. Currently LSR Group has proceeded to develop a new brand to be used in Moscow and the Moscow region.
The acquisition of new manufacturing facilities means a step forward not only for the company itself but, above all, for its partners. Reduced production costs as well as increased machinery productivity will enable the company to make the most competitive offer to its customers, both in terms of price and quality.

Aleksandr Sidorov, CEO of OJSC Zavod ZhBI-6 commented:

“Given the high speed of construction and installation work and relatively low costs, panel construction has always been and will remain in demand, and during the crisis it may even grow more popular.   That is why the fact that our company is more than ever targeting the needs of construction companies provides an adequate and timely response to the market. Combining the production of all prefabricated parts in a continuous process, we will offer to our customers an integrated high quality product and help them to save time and money.”   

Zavod ZhBI-6 is planning to make the machinery operational and start manufacturing products as early as the summer of this year. The plant is to achieve its full capacity in the third quarter of 2009. 

Notes to Editors:

OJSC LSR Group is a real estate and building materials company founded in 1993 and operating in a number of complementary market segments. Its core business areas are building materials, construction and real estate development. The Group includes enterprises for extraction and processing of aggregates, production and transportation of building materials, and housing construction — from mass market large-panel housing to elite property built after designs made by leading domestic and foreign architects.
LSR Group has operations and offices in a number of cities in the Leningrad region, in St. Petersburg, Moscow, Yekaterinburg, Lithuania, Latvia, Estonia, Ukraine and Germany.
In 2007, the sales revenues of LSR Group (IFRS) - were RUR 35,838 million, in 2008– RUR 49,813 million.
LSR Group is a public company, with its GDRs listed and traded on the London Stock Exchange and its shares listed and traded on MICEX and RTS. In 2007, LSR Group was awarded ‘The Company of the Year’ National Award in the ‘Construction’ category.

OJSC Zavod ZhBI-6
OJSC Zavod ZhBI-6, a company of LSR Group is a leader in reinforced concrete production in Moscow. Established in 1955, it was merged with LSR Group in 2006. 
The plant comprises five main shops and seven auxiliary shops. In 2008, the design capacity of the plant meeting the current demand was 136,000 cub.m of reinforced concrete per year, with a total of 15 million cub.m of products manufactured over the years of its operation.
The core business area of the company throughout its history has been fulfilling public procurement orders through supplying its products for the construction of government buildings and social and transport infrastructure. The products turned out by ZhBI-6 have been used for the construction and renovation of the White House (headquarters of the Council of Ministers of Russia),  Mayor’s Office in Moscow, Olympic Games Complex, Poklonnaya Gora Memorial Complex, Tsaritsyno Museum-Reserve, Izvestiya Publishing House, Third Transport Ring, Moscow City International Business Centre. Today the company offers over 1,500 reinforced concrete items including those used for housing and commercial property construction.
The use of flexible reconfiguration schemes enables the plant to promptly produce large quantities of reinforced concrete items. The plant is also capable of manufacturing non-standards products by virtue to its design office that complies with customer’s drawings.

For more details please contact:
LSR Group Press Service
Tel.: +7 812 314 10 44

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