Celje, 14 May (STA) - Chemical company Cinkarna Celje, one of the companies planned for privatisation, has reported a net profit of EUR 3.7m for the first quarter of the year, which compares to just EUR 32,000 in the same period last year.
Sales revenue was up 14% year-on-year to EUR 45.8m, 7% above the plans, the company reported in a press release posted on the Ljubljana Stock Exchange on Wednesday.
The management, which planned Q1 profit at EUR 3m, expects profitability to fall somewhat by the end of the year due to a slow decline in titanium dioxide pigment prices, but to remain within plans.
The company reduced financial debt by 46% or EUR 2.2m in this period, so that overall financial debt now stands at EUR 2.6m.
Capital expenditure was up 59% on the first quarter last year to EUR 1.9m. The biggest investment is in the modernisation, stabilisation and environmental upgrade of titanium dioxide pigment production.
Chairman Tomaž Benčina assessed the first quarter operating results were above the industry average, pointing to a 15% increase in pigment volume sales and an improvement in sale price trends. These fell by 1% from March 2013, while increasing by 2% from the end of 2013.
The state of inventories improved as well, equalling 25 production days.
On the downside, Benčina pointed to the fierce price competition in sales of titanium-zinc sheets, while on the upside the fall in zinc market prices ended and the situation in the north-European construction sector has improved.
The latter importantly contributed to a 46% growth in volume sales in the zinc manufacturing division, where Benčina expects positive trends to continue.