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Gorenje Forecasts Halving of Profit This Year

Velenje, 20 December (STA) - Household appliance maker Gorenje projects to finish the year with EUR 9.2m in net profit on revenues of EUR 1.4bn, Franjo Bobinac, the CEO of Gorenje, told the press in Velenje on Tuesday. While sales are on par with 2010, profit will be down by more than 50%.

Presenting the projected results, Bobinac said that comparisons with last year's results would be difficult due to the company's investment activities.

The group's results were affected by the negative results of the Swedish subsidiary Asko, and the sale of Gorenje's stake in the energy company Istrabenz Gorenje, according to him.

He added that the company is expected to make EUR 38m in operating profit and EUR 11m in positive cash flow by the end of the year.

Gorenje expects 7.4% growth in revenues next year, primarily in its core activity. The company plans to generate EUR 50m in operating profit and EUR 13.4m in net profit, Bobinac said.

In line with the group's strategy strategy until 2015, which includes organisational changes, the group's annual revenues are projected to stand at EUR 1.5bn.

The group's activities will focus on Gorenje's core activity, production of home appliances, which is to represent 90% of the group's sales. The company with over 10,000 employees will also look to boost its activities on international markets, Bobinac stressed.

Touching on the price of Gorenje's share, which has a book value of EUR 20, but trades at around EUR 4 on the Ljubljana Stock Exchange (LJSE), Bobinac argued that the market did not reflect the real value of the company.

He announced that the company would look to make a move for dual listing on a foreign stock exchange in 2012.

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