Rolast profit turns into loss

Faced with the loss of foreign markets and the slight appreciation of the domestic currency against the dollar, synthetic rubber parts maker Rolast Pitesti in 2002 posted losses for the second year in a row. Even though the company had made 10.7bn ROL profit in the first nine months, Q4 turned the gain into a 24.39bn ROL loss ($734,000).
This loss is even more serious than the one in the previous year, 21.14bn ROL. Losses rebounded during one of the worst years for Rolast after 1990 (in terms of sales), which ended with the general manager, Constantin Divan, being sacked by shareholders. Sales went down 7.8% in nominal terms last year, from 739.91bn ROL to 681.39bn ROL. If calculated in dollars, the decline was even higher, from $25.5 million to $20 million.
Rolast’s 2002 S&R budget estimated net profit to reach $1.2 million, while total revenues should have amounted to $29.3 million.
Dan Popescu, Rolast’s new general manager could not be reached for comment on the results. He was saying a couple of months ago that the negative trend of the financial situation was due to the decline of the foreign markets where Rolast operated. Another cause was the reversal of the serious depreciation of the domestic currency, which had made sales outside Romania “cheaper”. Rolast’s interim manager felt the company had not used up its internal cost-cutting resources, for which reason the current management was working on a restructuring plan.