The company will start production of its first soft drinks this fall, Violeta Moraru said.
“As sales of water almost tripled, beyond our projections, the company decided to start production of soft drinks this fall, when the new bottling lines are installed in Azuga. We decided to produce soft drinks in Azuga where we have a still water (…) slightly alkaline, which is most suitable for daily use and soft drinks production,” Violeta Moraru added.
The company has two mineral water brands, Perla Covasnei and Azuga Apa de Izvor. The bottling of the latter started in 2010. It inaugurated the plant in Catalina (Covasna County, central Romania) last year, where it bottles Perla Covasnei, following a EUR5 million investment; another EUR2 million were spent on distribution and promotion.
This is the second significant business of the Morarus, who became known for their beer business Bere Azuga, which they sold to Ursus Breweries in 2009. Shortly thereafter, Ursus decided to close the facility in Azuga but keep the brand, and rented the assets to Morarus’ company. The two started bottling water there and gradually bought back the assets they had sold to Ursus.
Azuga Waters, which announced plans to go into soft drinks production a while ago, will launch a value brand, Santiago and a premium yet unnamed brand. On its new market it will compete Coca-Cola and PepsiCo, whose revenue in Romania reaches several hundred million euros. Bottler Coca-Cola HSB Romania, for instance, posted 1.74 billion lei (EUR390 million) revenue in 2010, according to Trade Registry data.
The company saw revenue and sales volume triple in the first five months of the year.
“Sales stood at 51 million liters and more than RON18 million,” Violeta Moraru added.
The increase in sales was largely because of private label contracts signed with modern retailers.
The water market Azuga Waters operates on amounts to more than 10 million hectoliters and over EUR300 million. Consumption per capita stands at about 50 liters a year, according to information ZF previously got.
The largest companies on this market are Romaqua (Borsec), Coca-Cola (Dorna), Rio Bucovina (Bucovina) and European Drinks (Izvorul Minunilor). This is the only segment still dominated by Romanian entrepreneurs, as multinationals have taken over most consumer goods segments.
Azuga Waters expects 50% increase in revenue this year, after having seen it double in 2011. Revenue stood at RON31 million last year. (EUR1=RON4.4593)
(English version by Loredana Fratila-Cristescu)