14 december 2010
MMK looks to increase profitability andproductivity by improving sales and operations planning process
Magnitogorsk Iron & Steel Works (MMK) and GMCS announced today the start of a project designed to create a sales and operations planning system using Supply Chain Planner from JDA Software Group, Inc.

The innovation delivered through this new MMK project will help improve sales and profit, optimize product mix considering existing and perspective logistics and production opportunities.

MMK used data obtained through a pilot based on JDA Supply Chain Planner to estimate the solution's potential for its supply chain efficiency and effectiveness improvements. GMCS, a JDA partner in Russia, following successfully presented pilot results in contest, was chosen by MMK for Supply Chain Planner implementation.

The project envisages a step-by-step process. Project groups for MMK and GMCS have been formed and work on the system design has started. It is expected that the MMK sales and operations planning system will be brought into pilot operation in July 2011.

"Diversification of produced goods, expansion of sales and supply markets, and profit optimization are among key strategy tasks for the enterprise development. Integrated sales and operations planning process will support those activities," said Andrey Eryomin, Acting Director for Strategic Development of Magnitogorsk Iron and Steel Works Open Joint Stock Company. "The implementation of JDA Supply Chain Planner will help both to mitigate risks in connection with company’s expansion and raise the existing planning process to a new, higher level."

"The JDA Supply Chain Planner solution has proven its performance in the metals and steel industry worldwide, as well as in the Russian market. The solution helps companies increase sales and operations planning quality and improve the supply chain visibility. Its key benefits include profit margin and product mix optimization, increased asset utilization," said Vitaly Solodovnikov, Head of SCM Direction, GMCS.

"We are delighted that MMK has sel ected JDA solutions to help improve supply chain efficiency and customer responsiveness. We look forward to supporting MMK in its ongoing mission to maintain long-term competitiveness in the global market," said Razat Gaurav, Senior Vice President EMEA, JDA Software.

About MMK

MMK is among the world's largest steel producers and is one of the leaders of Russia's steel industry. The company's operations in Russia include a large steel producing complex encompassing the entire production chain, fr om preparation of iron ore to downstream processing of rolled steel. MMK turns out a broad range of steel products with a predominant share of higher value added products. MMK realizes MMK-Atakas project in Turkey with annual capacity of 2.3 mln tons of flat steel. In 2009 the company produced 9.6 mln tonnes of crude steel and 8.8 mln tonnes of commercial steel products. MMK Group revenue in 2009 stood at USD 5.081 bn, EBITDA at USD 1.285 bn, profit for the period – USD 219 mln.

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