The Northeastern State Enterprise (NESE) continues to provide enviable salaries to a handful of directors and Board of Directors (BD) members, despite its poor financial results. The behemoth, which manages forests in the Northeast, is at a serious loss of over 2 million leva, shows the enterprise’s financial report for 2024.
Last year NESE reported revenues of 63.2 million leva and expenses of 65.5 million leva, ending the year with a loss of 2.3 million leva. Revenues decreased by nearly 21% compared to the previous year, when they were almost 80 million leva. Despite this, the compensation of the company’s management competes with parliamentary salaries.
Over 47% of all NESE expenses are for salaries and insurance, the financial report data shows. Personnel costs are the largest expense “item” of the Forest Enterprise.
Here’s how salary funds are distributed during the year:
- For Board of Directors compensation (three people), a total of 324,000 leva was paid. The company director is also included in the BD.
- For directors of territorial enterprises (forest and hunting estates), a total of 18 people, 1.43 million leva was paid, or an average of 6,620 leva per person per month.
- For administrative personnel, a total of 276 people, 11,266,000 leva was paid, or an average of 3,401 leva per month per administration employee.
- For production personnel, a total of 691 people, 17,660,000 leva was paid, or 1,406 leva average monthly for forest workers.
As can be seen, regular forest workers receive two and a half times lower salaries than civil servants in the administration and 4 times less than directors of territorial units. Obviously, the main ones paying for the enterprise’s poor financial results are field workers, whose compensation is close to minimum wage. Besides low salaries, production personnel are also “punished” with staff cuts, at the expense of administration.
In 2024, 988 people work under employment contracts at NESE, 12 fewer than the previous year. The staff reduction is at the expense of production personnel, which was cut by a full 25 people – from 716 in 2023 to 691 last year. At the same time, the loss-making Forest Enterprise is inflating its administration, which increased from 263 to 276 civil servants.
Ministerial salary for the head of the loss-making Forest Enterprise
NESE’s Board of Directors was replaced in mid-2024 by the then-interim Agriculture Minister Georgi Tahov. On July 11, 2024, with his order, he surprisingly dismissed the entire BD – chairman Alexander Aramov, appointed by Nikolai Denkov’s government and remaining in the position for less than 7 months, operational director Peter Ganev and lawyer Snezhka Ivanova. Enterprise employees said their removal was not only surprising but almost insulting – the three received phone calls to check their emails, where dismissal orders were waiting for them.
New managers were appointed in their place, distributed by quotas between DPS (now Peevski) and GERB. Ivelin Todorov was appointed director of NESE, from the DPS-Peevski quota. Ilter Beyzatov became BD chairman, son of Boyko Borisov’s personal translator and longtime head of Forestry Beyzat Yahya. Upon his appointment he was from GERB’s quota, but later it was rumored he had embraced Peevski’s “New Beginning.” The third BD member Aysel Mustafova later became an MP from Peevski’s group. Thus, in practice, the entire forest behemoth in the Northeast is managed by people of Delyan Peevski, who is sanctioned for corruption by the US and UK.
Here are the compensations received in 2024 by NESE Board of Directors members:
– Simeon Davidkov, who was director until May 17, received a gross salary of 57,135 leva for 4.5 months, or 12,600 leva per month. Additionally, Davidkov received social benefits of 1,440 leva and Labor Code compensation of 5,785 leva, totaling 64,361 leva.
– Snezhka Yankova, who was a board member until July 12, received 40,045 leva in salary and 1,940 leva in social benefits, totaling 41,985 leva for 6.5 months.
– Alexander Aramov, who was BD chairman until July 12, received 40,045 leva in salary and 1,940 leva in social benefits, totaling 41,985 leva for 6.5 months.
– Peter Ganev, who was NESE director from May 17 to July 12, received 22,955 leva in salary for two months, or 11,500 leva per month. He also received 980 leva in social benefits and 2,909 leva in compensation.
– Current director Ivelin Todorov received 60,927 leva in salary for 5.5 months, or 11,077 leva per month. Additionally, he received 860 leva in social benefits and 3,466 leva in Labor Code compensation, totaling 65,253 leva for the period from July 12 to the end of December 2024.
– Current MP Aysel Mustafova received 22,158 leva in salary for the period from July 12 to November 13, or 5,539 leva per month, plus 380 leva in social benefits. In total, for 4 months on NESE’s executive board, Mustafova received over 22,000 leva.
– Current BD chairman Ilter Beyzatov received 30,463 leva in salary, or 5,538 leva per month. Additionally, he received 860 leva in social benefits, totaling 31,323 leva for 5.5 months.
– The newest BD member Mirena Tatardzhiyska received 8,305 leva in salary and 470 leva in social benefits for the period from November 13 to the end of the year, i.e., for a month and a half.
Against the backdrop of parliamentary salaries for the executives, the financial report shows a series of poor results in the state company, besides the financial loss:
– Negative revenue efficiency for 2024 at NESE amounts to 1.0373, or for every 100 leva in revenue, 103.73 leva in expenses were incurred.
– The enterprise’s current assets decreased by 17.50% compared to the previous year, while current liabilities increased by 2.16%.
– NESE’s debt amount increased by 0.29%, and the enterprise’s asset amount decreased by 7.54%.
In an analysis regarding the poor results for 2024, NESE executives acknowledge that “the financial results are not sufficiently satisfactory,” but immediately justify themselves with “the uncertain economic environment and existing inherent risks in the sector, related to a highly competitive and unstable business environment, reduced consumer demand and declining timber sales prices, as well as other market and governmental factors.”
