Parmalat: still soft drinks market to double by 2010

Parmalat Romania, producer of Santal soft drinks, has targeted sales of 17 million litres for this year and intends to double its previously recorded growth rate.
Last year, the company posted a domestic turnover worth 12.2 million euros, an increase of more than 15% against 2005 and an EBITDA of around 2 million euros.
“Last year volumes of Santal sales soared by 20%, exceeding 12 million litres, amid investments in our production lines,” states Giampaolo Manzonetto, manager of Parmalat Romania. In 2006, he forecast sales worth 14 million euros for the whole year.
“We failed to hit target sales last year because the product launch of Santal Top, initially scheduled for spring was delayed till August, owing to additional investments in the production line,” explains Manzonetto.
According to the company representative, fiercer market competition encouraged the company to invest more in promotion, resulting in profit estimates being downwardly revised.
Cumulated investments in the production plant in Parmalat Romania, have exceeded 15 million euros thus far, according to company data.
This year, the company will operate further investments in production lines, with their value to be approved by shareholders in the following period.
The company’s development strategy also targets the dairy product market on which it operates with the brand Parmalat milk, a product imported from Italy.
“We are considering introducing several categories of UHT milk onto the market. For instance, we intend to bring the product Latte Sviluppo from Italy, aimed at children aged between 3 and 12. We will therefore develop our range of dairy products for children, which has seen considerable increases since 2004,” says Manzonetto.
Manzonetto adds, that there are no plans to invest in domestic milk production, as one of the benefits of Romania’s EU integration is the elimination of custom duties for products imported from Italy.
Parmalat expects the non-carbonated soft drinks market to double in the next three years, due to rising consumption and an increase in the number of competitors. “After accession, I expected to see new competitors arrive on the medium and low price segments of the market, but this hasn’t happened yet. The premium segment of the market on which Parmalat operates is already strongly developed, which makes it difficult for new brands that might arrive on the market to succeed,” added Manzonetto.