Sanex Cluj turnover takes a nosedive

In 2005, Sanex Cluj, one of the biggest producers of ceramic tiles registered a steep 66.6% decline in turnover, to 75.2 million RON (20.7 million euros).

Moreover, amid shrinking sales, the company”s net income dropped last year from 11.1 million RON (2.7 million euros) in 2004 to 4.1 million RON (1 million euros). The financial indicator was lower both against the 125.5 million RON (30.8m euros) reported in 2004 and the budgeted sum, 101 million RON.

Since the spring of 2004 the company has been under the ownership of Lasselsberger, the Austrian producer of ceramic tiles. The company also includes another major producer, Cesarom Bucharest (now Lasselsberger SA) in its portfolio.

The Austrians at that time took over the investment vehicle Goodison Holdings, which held 67.64% in Sanex, in a deal put at 14-15 million dollars (more than 12 million euros).

The drastic fall in turnover was caused, according to Lasselsberger representatives, by “the pressure exerted by imports and by the unfavourable weather conditions for construction works.”

The entire Romanian ceramic tiles market had eagerly expected the Austrians” coming at Sanex, but in the wake of Lasselsberger acquisition, Sanex turnover has been falling.

Well ahead of acquiring Sanex, Lasselsberger had been in contact with the Romanian market through importers, previously owning the biggest domestic cement plant, located in Deva, which is now a part of the Heidelberg Cement portfolio.

Lasselsberger”s announcement of its intention to buy out domestic tile producers, in line with its aggressive policy, had created the impression that the Austrians would sweep the market and help domestic production, which had been sliding. However, the results have been contrary to market expectations and the Austrian group accounted for the turnover decline by blaming the mounting pressure of imports securing products at low prices, a decline in customers interest in fully tiling kitchens with ceramic wall tiles and the occurrence of a rainy period in the summer and autumn of last year, which affected construction activity.

Last year, Sanex sold 2.8 million square metres of wall tiles, compared to 3.5 million square metres in 2004. Sales of floor tiles also dropped, to a little above two million square metres, from 2.5 million square metres in 2004. catalin.lupoaie@zf.ro