Business News

Gorenje Group Halves Profit, Boosts Revenues in 2011

Velenje, 12 March (STA) - The group around the household appliance maker Gorenje saw its net profit drop 54.5% year-on-year to EUR 9.1m in 2011. Group sales revenues were meanwhile up 2.9% to EUR 1.4bn, according to unaudited results released on Monday.

Earnings before interest and taxes (EBIT) stood at EUR 36.5m, down 35.3% from 2010. The recently acquired Swedish subsidiary Asko and the sale of Gorenje's stake in the energy company Istrabenz Gorenje excluded, EBIT stood at EUR 41.1m, comparable to EUR 41.9m in 2010.

The main reason for the drop in profits is the negative performance of Asko, which is expected to break even this year, and Gorenje Notranja oprema, which started business restructuring in 2011.

The group repaid 4.7% of its debts, which is almost 9% above the plans, and the share of long-term loans increased from 53.9% in 2010 to 62.5% last year, Gorenje said in a press release.

Chairman Franjo Bobinac said that the situation on the household appliance market, which had been very demanding since 2008, worsened further last year.

"We are satisfied that we have reached and exceeded the plans regarding the positive free cash flow, the clearing of debts and the restructuring of the maturity of loans," Bobinac added.

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