Ergis

Press Release

18 August 2008, 08:14

ERGIS-EUROFILMS S.A.: SIGNIFICANT INCREASE IN REVENUE AND PROFITS AFTER TWO QUARTERS

ERGIS-EUROFILMS, leading plastics converters in Central and Eastern Europe, after two quarters of 2008 recorded revenue on sales at PLN 293.55 million, a ca. 56% increase over the corresponding period of 2007. Further, the net profit for the two quarters amounted to PLN 8.28 million and outperformed the same period of the previous year by over 23%.

Key events of the first two quarters:

  • After two quarters, ERGIS-EUROFILMS recorded revenue on sales at PLN 293.55 million, which represents a 56% increase over the corresponding period of 2007; the Polish companies of the Group generated PLN 193.26 million, while the German companies generated PLN 100.29 million. The net profit for the period increased by nearly 23% to reach PLN 8.28 million.
  • The sales in the second quarter alone increased by nearly 52%, reaching PLN 150.7 million. The net profit for this period reached PLN 19.6 million and was higher than the profit generated a year before by 34.7%.
  • The Group ordered supply of a flexography printing press for its subsidiary company Flexergis, thus initiating the implementation of the investment in the new production line of flexography prints for elastic packaging.

FINANCIAL RESULTS – DETAILED INFORMATION

The financial results of the ERGIS Group are presented in the table below:

 

PLN ‘000

Q2/2007

Q2/2008

Change

 

Q1-Q2/ 2007

Q1-Q2/ 2008

Change

Revenue on sales

99,268 

150,779

+51.9%

188,132

293,552

+56.0%

Gross profit

17,361

24,586

+41.6%

31,142

48,126

+54.5%

Net profit

3,633

4,894

+34.7%

6,766

8,285

+22.5%

 

The significant increase in sales and profit results mainly from the Group’s expansion by the inclusion of MKF-Folien GmbH, Schimanski GmbH, and Flexergis Sp. z o.o., along with the gradual development of branches located in Poland. Simultaneously, the Ergis Group realised exchange rate gains on loans, denominated in euros, taken for the purpose of purchasing the German companies. This was a balance for the strong zloty affecting the value of sales and profits on the German companies, expressed in zlotys.

FURTHER PLANS

In 2008, the ERGIS Group focuses on maximising synergies resulting from the acquisition of Flexergis, MKF-Folien GmbH Minderjahn+Keifer, and Schimanski GmbH.

The current plans of the Group include, first and foremost, the development of sales of goods produced by MKF-Folien and Schimanski in the Polish market, as well as the development of sales of the ERGIS Group’s products (including PET tapes, stretch films and laminates for food products), both through the existing distribution network of ERGIS-EUROFILMS and by sales forces of MKF-Folien and Schimanski.

“The financial results after the first half of the year indicate that our strategic decisions of last year, that is the merger of ERGIS and Eurofilms as well as the acquisition of the German companies, strengthen the value of the entire ERGIS-EUROFILMS group for all our shareholders. The Group’s structure is diversified and resistant to economic fluctuations. Our position in the Central European region is unquestionable, ensuring our systematic growth in the developing and absorbent market. We retain our plans for a new share issue which however will be carried out when the stock market investors prove to see the full potential of our Group,” declares Tadeusz Nowicki, President of the Management Board of ERGIS-EUROFILMS S.A.

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