Dufa, the paint and varnish producer, last year derived net income worth 4.4 million euros, enjoying the highest profit margin in the entire industry.
Dufa Romania, one of the biggest paint and varnish manufacturers on this market, last year sold a class A office building it owned in the northern part of Bucharest, a move that proved highly profitable for the company. The value of the deal amounted to 6 million euros.
Dufa Romania has budgeted 20% higher turnover for this year, 20 million euros. In 2005, the company posted turnover worth approximately 17 million euros, up around 23% from the previous year.
The company has earmarked investments worth 4 million euros for this year, targeting its production and logistic capacities. New logistic and warehousing capacities will allow the company to double its profit, according to the company''s representatives.
Advent International investment fund took over Dufa paint producer last June, with the total value of the deal being estimated at around 18 million euros, which included a 15 million euro investment.
Besides the core activities of paint and varnish production, the sum also included the dividends for financial year 2004.
Dufa Romania was set up in 1997 by the Meffert AG German group, which created a paint and varnish import and distribution joint venture together with a group of Romanian investors.
Before taking over the entire stake, Germany''s Meffert group held 50% in Dufa Romania, while Marius Ivan owned 40% and Liviu Stan, former general manager with Dufa had 10%.
Marius Ivan has recently withdrawn from the management and shareholding structure of Henkel Bautechnik Romania.
Dufa Romania sells paint and varnish only on the domestic market, where it holds a 21% market share, according to its own estimates.
The company this year plans to approach foreign markets.
The majority of the company''s turnover comes from sales of its water-based paint, for interior and outer walls.
According to data released by the company, the decorative paint market will reach a value of about 90-95 million euros this year, up around 8-10% from the previous year. Paint consumption per capita surged last year by over 10%, but is still way below the level registered in Hungary, Poland, the Czech Republic or West-European countries, according to market players.
The Romanian paint and varnish market generates annual sales topping 140-150 million euros, according to some estimates. Apart from Dufa Romania, other major players are Policolor, Guzu Chim or K?ber Piatra Neamt. Until recently, strategic investors and family businesses have dominated the paint and varnish industry, but recently it has attracted interest from investment funds. Several financial and strategic investors, interested in entering a business that has attractive rates of profit and a high growth potential, have courted the main paint and varnish producers.
Dufa Romania
@ Last year derived net income worth 4.4m euros, boasting the highest profit margin in the industry
@ For this year plans to boost turnover by 20%, to 20m euros
@ In 2005 posted turnover of around 17m euros, 23% higher year-on-year
@ Was last year taken over by Advent International investment fund, in a deal worth approximately 18 million euros
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