Mladen Petković, General Manager Of HK Krušik A.D. (JSC) Valjevo:

Breaking One’s Own Records

Last year’s results are among the best in the 78-year-long history of the factory. The plan for this year is to export goods worth 80 million U.S. dollars. Contracted projects, worth 257 million U.S. dollars, will be realised by the end of 2019

With business profits exceeding 500 million dinars and exports worth around 50 million dollars in 2016, Krušik achieved one of its best results in its 78-year existence. The General Manager of the factory, Mladen Petković, says that it was also kind of a “start”, with the Company striving to achieve an export record this year.

– Considering this year’s contracted projects, we expect the achieved results to be the best in Krušik’s entire history. In the 1980s, at the time of the biggest expansion, the factory recorded exports worth 76 million U.S. dollars, but back then 9,000 people worked at Krušik. Now we plan to reach 80 million U.S. dollars with just over 2,000 employees, thereby achieving the highest export in the Company’s history.

How many people will get jobs in Krušik in 2017, having in mind the opening of two vital facilities: “Alatnica” (Plant for rocket motor chambers production) and “Kapislana” (Primer plant)?

– In order to realise concluded contracts within the prescribed deadlines, we have hired additional labour. Since 2014, 1,493 working places have been established, 405 of which include workers hired this year, so the factory currently employs 2,641 workers. Each time Krušik announces a need for new workers, the HR department really has its hands full, because there are at least ten applications for each position.

At the same time, the staff structure of employees has also been improved. Here I am primarily referring to the age structure of engineering staff and master craftsmen. The ratio of administrative to production workers is also changed. Although this is a production company, in 2013 a total of 60 per cent of employees were engaged in non-production positions, while today that number has fallen down to under 15 per cent.

More than 90 per cent of Krušik’s profit comes from export. Its products are present in more than 70 countries worldwide, while the biggest customers are from the U.S., Saudi Arabia, the United Arab Emirates and Vietnam

You already have valuable contracted export dealings. Are there any new major contracts to be announced and, if so, with which countries?

– In order for Krušik’s products to find their place on the world market, we have commenced the activities related to modernisation of the production programme and expansion of the production range by implementing fully new items and technologies. We have established serial production of products from the missile program, which has led to growth in sales and production volumes, so that Krušik today has concluded contracts worth 257 million U.S. dollars, which ensures the utilisation of capacity until the end of 2019. I would like to note that a technology transfer contract worth 30 million Euros came into force in 2016. Average annual growth in the past three years amounted to 68 per cent.

More than 90 per cent of Krušik’s profits is achieved from export. The biggest buyers at present are the United States, Saudi Arabia, the United Arab Emirates and Vietnam, but Krušik’s products are present in more than 70 countries worldwide.

What are current priorities for Krušik: investment in new plants and products, retraining of personnel, reconstruction of facilities destroyed NATO bombing…?

– We have started the investment cycle in the past two years, through investments in the adaptation and reconstruction of existing production capacities, as well as through the construction of new production facilities and the restoration of capacities damaged during the bombing.

In addition to the products from the mortar programme, which Krušik is renowned for all over the world, today we produce modernised and brand new products from the missile programme. Here we are primarily referring to the GRAD rockets, with extended range (40 km), rocket 107mm, the upgraded Oganj rocket, the upgraded Malyutka guided missile with 2T and 2F warhead (tandem-cumulative and thermobaric), the rockets Plamen A, Plamen D and others. We have also started the production of 155mm artillery projectiles. We expect to have serial production of the S-8 air-to-ground rocket by the end of 2017.

Krušik suffered significant damage during the bombing, and until 2014 almost nothing had been reconstructed. With the arrival of the new management, the reconstruction of damaged facilities and the construction of new ones began. The first facility, worth 9.4 million euros, was built on the site of the former “Alatnica”. This is a rocket motor factory that is the only one of its kind in Serbia and the countries of the region. The modern Primer plant will also start working soon. Within the first phase, its value amounts to 10 million euros and the plant will be intended for the production of domestic primers for the “boxer” type ammunition, which have previously been purchased from abroad for the needs of the entire Serbian Defence Industry.

The modernisation of the production programme and the expansion of the production range are underway. Facilities destroyed during the NATO bombing in 1999 are being restored; the rocket motor factory has been built on the site of the former “Alatnica”, while the modern Primer plant will soon start operating

Unlike a large number of domestic companies, Krušik has an open competition for hiring employees, with salaries that are regular and above average. To what extent do these working conditions influence employees’ attitudes towards the Company and impact on the overall efficiency of the technological process?

– We will hire new employees in accordance with the needs of the production process and the pace of new production capacity building. Given the domain and nature of the production process at Krušik, we mostly need mechanical and electrical engineers, operators on CNC machines and other related profiles.

The average net salary paid for May amounted to 49.151,91 dinars, and in the course of the last three years the Factory has connected the working status for 261 workers, while around 179 million dinars has been allocated for the payment of arrears and retirement benefits.

How satisfied are you with Krušik’s performance at the Eighth International Defence Exhibition, “Partner 2017”, which was held in Belgrade at the end of June?

– At the Eighth International Defence Exhibition, “Partner 2017”, which was opened by Serbian President Aleksandar Vučić and attended by the Ministers of defence and justice, as well as representatives of numerous Embassies and military delegations of ten countries, Holding Corporation “Krušik” a.d. Valjevo presented its complete production programme. In addition to products from the mortar programme that Krušik is known for throughout the world, we also showed modernised and completely new products in the field of rocket production.

The wide range of products exhibited at our booth drew the attention of both domestic and foreign visitors. The Exhibition was visited by high-level delegations from around the world, as well as representatives of NATO, the European Defence Agency and other international military-security organisations. We can note that, besides the usual questions related to the standard programme, the greatest interest was shown in unguided rockets for multi-barrel launchers of all calibres, all produced in our factory, but also for overhaul and the modernisation of “old” Krušik products.