Kober predicts further decline on paint market

Varnish and paint producer Kober, based in Piatra Neamt and held by businesspeople Aurel and Mariana Kober, expects the decline in paint sales to deepen to 30-35%, compared with 20-25% in the first half of the year, on fluctuating demand and the 50% decline in the number of new sizeable real estate projects.

“We predict an around 20-25% decline in the volume of products sold on the market and believe this trend will continue into the second half of the year. The decline may worsen to 30-35% in the upcoming period,” said Aurel Kober, president of Kober. The company’s turnover in RON in the first half of the year was similar to the figure recorded in the year-ago period, but its value was not revealed. Kober posted a 20% rise in its pre-tax turnover last year, to 50 million euros.

Kober believes the market’s unpredictability and the real estate crisis led to a 20-25% quantitative decline in the first half of the year. According to company officials, paint sales registered abrupt fluctuations, from very low sales to a two-week period during which demand was too high to meet.

“Another factor that affected sales was the reduction in liquidity available on the market, which gave rise to major debt recovery difficulties. The side-effect is the even steeper sales decline, caused by total or partial lack of confidence in our clients’ repayment abilities,” says Kober.

The company is now weighing every bit of expense, in a new cost and needs analysis.

“As this is a highly seasonal market, we have cut stocks, and managed raw material supply better this year. We have reduced costs to an optimal level, after considering several scenarios regarding this year’s sales evolution,” says Stefan Barna, Kober’s strategy manager.