On the other hand, revenue increased by 6% to RON923 million.
“The rise in raw material prices and salary costs led to a decline in Egger’s profit in Romania. Egger saw development of revenue in Romania because of the increase in the volume of products sold to customers on various markets,” said Leonard Curcumelis, chief financial officer of Egger Radauti.
Egger is one of the three largest Austrian investors in the local wood industry, along with Holzindustrie Schweighofer and Kronospan. The three make about EUR1 billion revenue a year, double as much as they did in 2009. The largest of the three is Holzindustrie Schweighofer, whose yearly revenue for one company stands at about half a billion euros. The group expects EUR550 million revenue from Schweighofer’s operations in Romania this year, 8% more than in 2013.
Of the three Austrian companies, Egger is the latest entry in Romania. It started production in Radauti in 2008, following EUR210 million investment in plant that makes particleboard and other wood products. Egger manufactures particleboard and melamine-faced particleboard for furniture industry and interior design use and oriented strand boards (OSB) for wooden structures, wood-based material distributors and carpenters.
Egger continued investment in 2010, after spending EUR17 million on equipment and an office building for its employees. It has recently completed work on an 83 MW biomass-fired power plant, which will supply power and heat to the company and required a EUR35 million investment.
Egger exports more than 60% of its production in Romania to South-Eastern Europe, Middle East, the Baltic Countries and the CIS countries. In all, its Romanian-made products reach 29 countries.
Romania’s particleboard exports amounted to almost EUR400 million in the first 11 months of 2013, while the medium density fiberboard (MDF) exports reached EUR103 million, according to the Romanian Furniture Manufacturers Association (APMR). Romania’s lumber exports stood at EUR670 million in the first 11 months of 2013, while furniture exports at EUR1.5 billion. (EUR1=RON4.3981)
(English version by Loredana Fratila-Cristescu)