Amid the challenging conditions on the Romanian market related to the various protests around shale gas and the ambiguous legislation, Prospectiuni, a company controlled by local entrepreneur Ovidiu Tender, started signing contracts in Georgia, Algeria, is in talks in Turkey, but is also eyeing Greece and Italy.
In the first half of this year, Tender’s company reported net loss of 37.8 million lei (EUR8.6 million), three times wider than the loss of the same period of 2013. At the same time, the company saw its revenue slide by 10% in the first six months, to RON120.2 million (EUR27.32 million).
The figures come as Prospectiuni had budgeted an 8% revenue increase this year to RON435 million (EUR98 million).
According to Schultz, there were several factors that hurt Prospectiuni during this period. The warm winter and rainy spring rendered access impossible for the company’s heavy machinery. The violent protests against shale gas exploration, especially those of the area of Moldova, where Prospectiuni has a contract with US Chevron, problems related to construction licensing also hurt the company.
Delays come in the context where Schultz says Prospectiuni has a lot of contracts underway. “We have EUR30 million worth of contracts underway and another EUR41 million worth of contracts we already signed. We have a very good position, but execution times are longer. We have another EUR24 million worth of contracts under discussion. In 2013, we lost money on the lack of contracts. This year, we have contracts, but we’re losing money because of delays”.
In this context, the direction Schultz has penciled ever since he arrived at the company’s helm, of turning Prospectiuni into an international company, has started materializing.
“We’re driving a growing part of our business abroad. In 2014, we signed contracts in Georgia and Albania and we are now in final talks for a project in Turkey, which is becoming a very interesting market owing to high hydrocarbon prices”.
Moreover, Prospectiuni is present in several African states, being already involved in auctions in Egypt.
Now, around 15% of contracts signed by Prospectiuni are abroad, but by revenue their weight rises to 30% on domestic market delays.
While for Romanian operations, Prospectiuni has operated layoffs, the company started hiring abroad.
However, Schultz is still upbeat about the domestic market and says that on the basis of contracts the company has underway, these people will come back.
(English version by Catalina Apostoiu)