Siretul Pascani, a textiles producer, ended the first quarter of this year in the black, having registered a profit of around 73,000 euros (0.26 million RON) in late March, compared with losses standing at 80,000 euros (almost 0.3 million RON) during the same period last year.
The company''s turnover, though, shrank by 27%, to 1.6 million euros (5.7 million RON). In the first three months of 2005, Siretul sales had amounted to 2.2 million euros (8.2 million RON). However, turnover was in line with the level set in the spending and revenue budget for 2006.
Profit was primarily derived because the company implemented a programme of redundancies in the second half of last year, resulting in a reduction in the number of the company employees by 50%, from 1,380 at the end of the first quarter of 2005, to less than 670 in this year''s Q1. This caused a massive decline in the company''s personnel expenditure, which dropped by 36.5%, to a level of 0.59 million euros (2.1 million RON). Expenditures related to raw materials and consumables also decreased, by around one third, to 0.6 million euros (2.15 million RON).
Siretul estimates it will reach turnover worth 7.6 million euros (26.5 million RON) this year, up 6.7% compared with sales logged last year.
The company has budgeted gross income worth 0.52 million euros (1.84 million RON), almost five times the value posted in 2005. Siretul plans to launch its own brand of sporting equipment, called Dinamis, on the market. The new products will also be introduced on foreign markets, after already receiving several orders from some foreign customers. Over recent years, Siretul has delivered sports equipment that has been used by NBA players. However, the company halted sports equipment deliveries to the US last April.
Siretul Pascani is one of the few manufacturers of textiles in Romania not working under contract for others. The company specialises in the production of textile materials and synthetic-fibre clothing, known on the domestic market as one of the main producers of curtains. Last year, Siretul tried to become a partner of Praktiker and Cora by supplying them with curtains last year but failed. The company also produces car upholstery, and has contracts with Daewoo Craiova and Dacia Automobile Pitesti.
Last year the company logged 7.12m euros (25.8 million RON) in turnover, down 35% from 2004, amid a net income worth 87,000 euros (0.31m RON). Exports last year accounted for 37% of the company''s turnover.
Siretul does not have a majority stakeholder. The company''s main shareholders are SSIF Broker Cluj and SIF Transilvania, which own stakes below 10%.
Siretul shares are listed on the Bucharest Stock Exchange, where they have been on a descending trend over the past year. Last year, Siretul shares dropped by more than 50% and have lost another 5% since the beginning of this year.
Siretul Pascani
* Specialises in the production of textiles and synthetic fibre clothes; known as one of the main curtain producers in Romania
* Ended Q1 2006 in the black, with profits worth 73,000 euros
* Turnover dropped 27%, to 1.6m euros in Q1
* Profit primarily triggered by the redundancy programme carried out in the second half of last year
* Forecasts turnover worth 7.6m euros this year, 6.7% higher compared to last year''s sales.
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