In 2013, the company with brands such as Zestrea Murfatlar, Lacrima lui Ovidiu, Trei Hectare in its portfolio, reached revenue of RON129.7 million (EUR29 million), down 3% against 2012.
Daniel Negrescu, brand manager at Murfatlar, explained the winemaker’ optimism is based on the trend of the wine market, where conditions differ from previous years, and on the premium brand portfolio, set to expand its weight in revenue.
“Budgeted growth is based on market conditions. 2011 and 2012 were years of very low outputs, below normal averages. The outputs came consecutively, hence yielding high production costs. These pushed winemakers to raise prices not amid rising demand, but on low offer. In their turn, high shelf prices, doubled by falling purchasing power, pushed consumption lower and consumers shifted to other categories,” believes Daniel Negrescu.
Murfatlar official says the situation is now different, after 2013 was a very good year, with above-average output. In 2013, production amounted to over 4 million hectoliters of wine, up 20% from 2012 and a three-year peak, according to the association of employers in the wine industry (PNVV).
“Winemakers have returned to ‘normal conditions’ and prices and offers are now competitive against other categories. The low-price segment that had almost disappeared 1-2 years ago is here again. All this will lead to a consumption rebound in 2014. This is one of the reasons why we budgeted growth. Another reason is M1. Crama Atelier, a growing brand on the premium segment”.
In 2012, the company started switching to the premium segment, with M1. Crama Atelier brand. The brand saw revenue double each year, said Negrescu, above the company’s initial expectations.
“M1.Crama Atelier is the project we are investing more resources in at this moment. This clearly shows our priorities,” added Daniel Negrescu.
Overall, the premium and super-premium products part of the portfolio reached over 35% in revenue.
From profit of almost RON0.4 million (EUR0.1 million) in 2012, the company reported losses of RON103 million (EUR23.3 million) in 2013. About their level, the company’s officials said that “insolvency hurt several commercial partners of Murfatlar Romania”.
For 2014, the company has budgeted profit of almost RON0.7 million (EUR0.15 million).
Murfatlar is controlled by brothers Dobtronauteanu, extremely discreet businessmen, involved in several businesses.
On the wine market, valued at EUR350 million, the largest players are Murfatlar, Jidvei, Cotnari, Tohani, Recas, but a rising number of medium-sized and large companies are emerging.
(English version by Catalina Apostoiu)