“We expect this year to be better overall than 2010. We don’t expect the current external situation to cause Arctic’s turnover to decline, if fact we expect the 18% exports rise to continue,” said Monica Iavorschi (37), general manager of Arctic Romania. She declines to offer forecasts for the end-of-the-year turnover, but says she expects the trend to be similar to that recorded nine months into the year.
Arctic posted turnover of EUR165 million between January and September 2011, up 16% against the similar period of 2010. So, if the turnover rises at the same pace for the full year, Arctic could reach turnover of EUR260 million at the end of the year, which compare with EUR224 million last year, according to ZF estimates.
The turnover includes sales of refrigerating devices manufactured in Gaesti (Arctic and Beko fridges) and sales of home appliances (washing machines, gas cookers and dishwashers) manufactured in the other plants of Turkish group Arcelik, which owns Arctic. The products of the Arctic brand are sold exclusively on the Romanian market, while Beko products are sold both in Romania and are exported.
Monica Iavorschi says the domestic market of large home appliances has remained relatively steady compared with last year, being proportional to the economic evolution.
“This year the economy is expected to rise by less than two percent, and the market will have a similar evolution. Nine months into the year the rise of the domestic market was around 2%, and I think the same is true of the Romanian market.
She adds that the local market of large home appliances – refrigerators, washing machines, dishwashers and gas cookers, is worth around EUR300 million based on shelf prices.
“If the purchasing power increases, the local market can easily double.”
However, Monica Iavorschi says although she is hoping the consumption recorded during the boom period will be revived, the light at the end of the tunnel cannot be seen yet.
As for exports, Arctic sells its products onto 58 foreign markets, among which Germany, Poland, Turkey, and, starting this year, South Africa.
“This year we were no longer caught by surprise. (…) The only surprise is the less good performance of European economies. But the situation did not affect us because the countries most hurt had a lower share of our exports. Under the circumstances, exports are above expectations for us.”
Exports account for 80% of Arctic’s overall production in Romania and 70% of the company’s turnover. Nine months into the year, the local market amounts to EUR50 million and exports to EUR115 million.