Annual report 2013

Economic contribution

Norilsk Nickel is central to the development of its principal operations areas due to its enterprises’ status as the main local employers. The Company makes a significant contribution to local social and economic development primarily as a major employer and taxpayer. It is also active in tackling social development priorities both independently and as a partner of the local public and authorities in the cities Norilsk, Dudinka and Monchegorsk, Zapolyarny and Nickel urban settlements, and the Taimyr Dolgan-Nenets and Pechenga municipal districts.

Economic Contribution

Norilsk Nickel’s tax deductions to the Krasnoyarsk Territory budget totalled 28.8 billion roubles in 2013 – 10% less than the year before. The Norilsk municipality received 3.7 billion roubles out of this money. Tax payments were reduced in line with shrinking metal sale profits, as global prices had fallen.

The calculation comprises all taxes except VAT, dividend taxes, insurance fees and customs duties.

Net Profit, USD mln

Norilsk Nickel tax deductions to Russian budgets of various levels, 2011-2013, billion roubles

Promotion of youth employment and career guidance

The absence of youth unemployment is a shared goal of both the Company and the authorities in its areas of operation. As young people dream of careers outside their permanent place of residence, school student career guidance is moving ever more into the foreground of Company priorities.

In 2013, the Company continued its partnership with government organisations with regularly renewed contracts, and launched its own projects for career guidance and additional vacancies for young people and adolescents.

Occupation Navigator Club

The Occupation Navigator project is a link in the chain of future-oriented workforce recruitment for the Company. It offers career guidance for school students and unemployed youth, popularises blue-collar occupations, and orients municipal school leavers towards Norilsk Nickel careers. The Occupation Navigator Club has its own information platform – the corporate website. The project is implemented in partnership with all Norilsk and Dudinka educational establishments. The club arranged 52 excursions for 1,153 school students to the Russian-based Group enterprises in 2013. The club concert team performed at 25 city schools to a total audience of 3,500. Its interactive programmes for various school age groups popularised career guidance.

Club events involved 27,200 youngsters in 2013, including 25,500 at the Zapolyarny Branch and 1,600 at the Kola MMC.

The I Want a Shop floor Job contest is for students of Norilsk vocational training institutions – School No. 105, Lyceum No. 17 and the Polytechnic College at the Norilsk Industrial Institute. Taking part in it are young specialists of the Norilsk Nickel enterprises. The teenagers made excursions to Company enterprises, attended career guidance sessions, and competed in athletic and intellectual contests. The finals offered creative and technical puzzles to teams of different ages united by an interest in a particular occupation. Altogether, the contest involved over 1,000 boys and girls.

The annual Road to Tomorrow corporate children’s creative contest instills in children an interest in occupations in the greatest Company demand, and helps them learn more about their native city and region. The 2013 contest was dedicated to the Year of Environmental Protection in Russia.

School work teams recruited 180 teenagers (in the 14-18 age bracket) in Monchegorsk and the Pechenga District and 813 in the Norilsk industrial district during the 2013 summer holidays. Group enterprises hired them as unskilled labour (minor repairs, street cleaning and greenery planting in the city and on industrial premises). They took part in art and athletic contests, and visited cultural and sporting events. Kola MMC arranged a communication workshop on employment and adaptation to new workmates for the team members.

The Zapolyarny Branch, the Norilsk Industrial Institute and the municipal department of general and preschool education jointly organised a career guidance contest under the motto “Dreaming of a future career.” It attracted 10th and 11th grade school pupils and Norilsk Industrial Institute second-year students seeking training in the Company priority fields. Contest organisers and experts from the Norilsk Nickel corporate university arranged excursions for the contestants. They visited the Komsomolsky ore mine, the Talnakh ore-dressing factory and the Copper Factory to see the entire production cycle.

The Norilsk Nickel career guidance marathon race involves 8th to 11th formers of general education schools situated in the areas of operation of the Kola MMC and other Group enterprises. Each year’s event revolves around a particular aspect of Company work. It was dedicated to the energy industry in the 2012-2013 academic year and the transport and logistics Company complex in 2013-2014. The contest includes both team and individual competitions. The schools whose teams are the most active receive assistance to improve their material status and infrastructure, while students are given scholarships for a year or valuable gifts. There were 4,700 participants in the 2012-2013 event – 2,000 more than the previous year.

The Metal-Making City contest highlighted and promoted trailblazing school methods of extracurricular career guidance. It gathered 30 teachers from 19 municipal schools and finished in April 2013.

Contests in the Between the Past and the Future project, dedicated to the 80th Norilsk Combine anniversary, were launched at an open-door conference of career guidance experts of Norilsk schools in September 2013.

Below are some 2013 statistics representing the work implemented under the cooperation agreement between OJSC MMC Norilsk Nickel and the Norilsk territorial employment office:

  • 6,075 school students participated in career guidance events;
  • 626 people found employment with the Zapolyarny Branch – 58 of them after training on the Trainee and Labour Reserve programmes;
  • 355 underage boys and girls found temporary employment for the summer holiday as Zapolyarny Branch unskilled workers.

Development of cooperation contacts

In 2013, the Company organised 538 tenders, 359 of which (66.7%) were won by Krasnoyarsk Territory-based enterprises. The Group spent a total exceeding 11.7 billion roubles to purchase products and services from Krasnoyarsk Territory industrial plants and organisations. Of this it spent:

  • 2.5 billion roubles on material resources;
  • 531.3 million roubles on foodstuffs;
  • 8.7 billion roubles on paid services.

Social infrastructure development and addressing social problems in the areas of operation

The Company is active in the construction and reconstruction of social infrastructure projects in its areas of operation to create a friendly and easily accessible environment for labour and residence.

Krasnoyarsk Territory

MMC Norilsk Nickel actively contributes to the social development of Norilsk and the Taimyr municipal district in compliance with the quadripartite agreement on partnership and cooperation, signed on 31 August 2010 between the federal Ministry of Regional Development, the Krasnoyarsk territorial administration, the Norilsk municipal administration and the Company. It envisages the upgrading and modernisation of social infrastructure projects and the implementation of its own socially oriented business projects.

The initial construction stage of the Arena Norilsk sport and entertainment centre was completed in 2013 with the opening of its public and trade zones, which took up two-thirds of the total area. The construction cost 887 million roubles out of the total 3.2 billion Norilsk Nickel had earmarked to fund the construction out of its own budget.

Two new kindergartens opened in Norilsk in September, each for 300 children. The Company spent 1.2 billion roubles on their construction. Of this, 512.5 million was spent in 2013. The new projects put an end to kindergarten waiting lists for children aged 3-7 years old.

The Company co-funded the construction of a roofed-in artificial ice skating rink seating 250 in Dudinka. The sponsor spent the full 135 million roubles it had earmarked for the project. The expenditures for 2013 totalled 30 million. The Company also funded thorough trunk sewer repairs at 63.3 million roubles and the reconstruction of two motorway bridges in Norilsk, at 5.3 million. It also spent 3.4 million roubles on engineering research and design and detailed documentation of bridge reconstruction.

Altogether, the Company funded works and project maintenance totalling 1.6 billion roubles in 2013.

The Company has pooled its efforts with the territorial authorities to take part, on a charity basis, in an ambitious project to resettle Norilsk and Dudinka residents in areas with a friendlier climate. The long-term targeted programme envisages the resettlement of 11,265 households a year from 2011-2020 (1,126 households a year). The beneficiaries have the right to resettle on state programmes and are registered at city councils. The Company intends to spend 8.6 billion roubles on the programme.

The programme is open to the disabled, pensioners, and employed and unemployed individuals with northern work records of no less than 15 years, who have no mainland housing accommodations and had arrived to the Far North before 1 January 1992.

Norilsk Nickel fully complied with its programme obligations for 2013 by transferring 830 million roubles to the Krasnoyarsk territorial budget.

Altogether, the Krasnoyarsk territorial Ministry of Construction and Architecture had approved 1,290 housing purchase certificates by January 1, 2014, within the 2013 limits of federal and regional allocations – 1,036 apartments for Norilsk and 254 for Dudinka. Housing purchases on the 2013 limit will continue up to the end of July 2014.

The overall expenditures on charity and the construction and exploitation of social infrastructural projects totalled 3.5 billion roubles, including charity, expenditures to support NCOs, the construction of two kindergartens and a roofed-in skating rink, and resettlement programme funding.

Murmansk Region

The Company-sponsored construction of a sport and fitness center in Monchegorsk was completed in 2013. The centre has facilities for tennis, volleyball and basketball, and will eventually have a dance floor.

The Company carries on assistance to the federal project for a state-of-the-art tourist information center at the Pasvik nature reserve in the Pechenga District, and funds the installation of jungle gyms in Monchegorsk and the Pechenga District.

The Company also takes part in the funding of maternity ward reconstruction at the Pechenga central district hospital. Relevant design work began in 2013.

Education development

The Company provides regular assistance to mining and metal industry educational establishments with equipment and teaching aids.

In August 2013, it approved targeted cooperation programmes for 2013-2015 with its long-established partners – the Norilsk Industrial Institute, the Norilsk Technical School of Industrial Technology and Services, and Vocational School No. 105.

The Company allocated 34.3 million roubles – 47% more than in 2012 – to fund the equipping of vocational schools for general educational and occupational training purposes, and repairs to laboratories and workshops training students in occupations in high Company demand.

As a part of a strategic partnership programme with the Siberian Federal University, the Company funds in-depth secondary school study in the disciplines necessary to enter university mining and metallurgy departments. Relevant curricula were used in 2013 in five 10th forms and in another five 11th, final forms – all told, involving 250 students. 67 out of the 99 school leavers were enrolled in the Siberian Federal University – 21 of them to study metallurgy and 25 mining engineering.

The university also hosted a Quick Minds Tournament and career guidance roundtables organised by the Company. In cooperation with the university, the Company monitors targeted classes from the first year with a view to eventually employing their students. The partnership also covers the presidential programme for engineer retraining.

Resettlement programme in 2011-2013

2011 2012 2013 Total
Company contribution, mln roubles 1,181 830 830 2,841
Apartments purchased 1,137 1,013 629 2,779
For Norilsk 957 850 520 2,327
For Dudinka 180 163 109 452

Expenditures on charity and social infrastructure development, billion roubles