Expansion brings Praktiker in the black

Praktiker Romania, the company that operates the Praktiker network of DIY stores, last year derived profit for the first time since it was set up, after increasing its rate of expansion.

The company posted net income worth almost 4.3 million euros (15.5 million RON) amid turnover worth close to 105 million euros (380 million RON). These figures are in contrast to 2004, when Praktiker had witnessed losses worth 0.8 million euros and turnover standing at almost 62 million euros.

The general manager of the company, Guenter Vosskaemper, early this year announced the expansion target had been raised from 15 to 20 stores.

After completing the first store in the autumn of 2002, Praktiker has opened three units each year. Except 2005 when the Germans opened four stores, which is the target they are also planning to repeat this year.

Praktiker Romania logged profit after their main rival, the French group Bresson, has been generating profit from its Bricostore network since 2004. Unlike Bricostore, Praktiker opens stores in rented space, and not in locations that it owns, which has rendered it more dynamic.

As a result, even though both networks opened their first stores in 2002, at the end of last year Praktiker had reached 11 stores, while Bricostore owned five stores.

The average investment per one Praktiker store entails around 7 million euros, while investments for a Bricostore store may exceed 10 million euros.

Praktiker is not the only international retailer to have stepped into the black last year after having coped with several years of losses. The same happened with Carrefour, which posted profit worth 5 million euros. While the profit figures the two retailers reported for last year were similar, turnover derived by Carrefour Romania is more than four times higher than Praktiker”s, topping 430 million euros.

Metro and Selgros cash & carry store operators, as well as Billa, Mega Image, Artima supermarket networks and discounter networks XXL Mega Discount, Profi or Intermarche have been in the black for several years.

Praktiker was controlled by Metro German group, which has sold its interest in it for almost half a billion euros this year. ionut.bonoiu@zf.ro