Business News

Gorenje Half-Year Profit Down by 64%

Velenje, 24 August (STA) - The group around household appliance maker Gorenje reported a EUR 2.3m net profit for the first six months of 2012 on Friday. This is almost a 64% drop year-on-year and comes on the back of a 3.3% decrease in sales revenues to EUR 618.6m.

The company pointed to the debt crisis, the high level of unemployment, high prices of raw materials, payment defaults and unfavourable currency fluctuation as the main reasons for the poorer performance.

Sales revenues improved in the second quarter of the year compared to the first, only trailing last-year's by 1%, the 3.3% half-year decrease is however only calculated if one ignores for 2011 the July sale of energy group Istrabenz Gorenje.

Operating profit was at EUR 16.5m, a 7.2% drop compared to the first six months of 2011, however with the EBIT margin rising from 2.4% to 2.7%.

Gorenje chairman Franjo Bobinac said in a press release that the situation on the markets remains unpredictable and full of challenges.

"The battle for market shares and the right sales structure on the one side and at the same time a stepped optimisation of production locations and cost management are the key activities we are focusing until the end of the year," he added.

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