This is part of the investment projects worth EUR 32 million that the Group is implementing.
“This year we announced record results, but we have been limited by the production capacities. The fact that the infrastructure works speeded up is a sign that finally Romania is mobilizing to fulfill its obligations. There is still a lot of work to be done to reach 99% of the population connected to water, sewerage and gas like our neighbors. We have supplementary funds for both the water and sewerage works and for irrigation works. It would be a pity for the Romanian producers not to be able to efficiently respond to the market demand now that the works are happening. We invest in a new factory and at the same time we invest in the development of the Romanian production, the development of Romania’s infrastructure and we contribute to equilibrate the trade balance.” stated TeraPlast CEO Alexandru Stanean.
The project implies the construction of a new factory in TeraPlast Industrial Park in Saratel village, (Bistrita-Nasaud County) and the acquisition of state-of-the-art equipment. The new factory there will be produced polyethylene systems for water, irrigation and natural gas. The project will be completed in February 2022 and 80 new jobs will be created.
The manholes and pipes made from polyethylene following the investment will double the production capacity of the Installation business line for these product groups. TeraPlast’s manholes are used in sewerage networks in the industrial, residential and agricultural areas. The polyethylene pipes are used for the transport and distribution networks for drinking water, general use water, natural gas, telecommunication, pressure sewerage and irrigation.
“The state aid can be considered an interest-free loan that the company commits to pay back within 5 years as salary contributions, corporate tax and local taxes. Thus, following the 3 investment projects for which it received the financing agreements, TeraPlast Group will contribute to the state budget with EUR 14,6 million. This represents the value of the state aid received, supplementary to the contributions of the current structure of the Plastics division,” the report reads.
For 2020, TeraPlast Group estimates a consolidated turnover of EUR225 million, 12% more than in 2019. The Plastics division of the Group will register a net profit four times larger than the level reported in 2019, reaching EUR9 million in 2020.
TeraPlast Bistrita, which has a market value of RON765.3 million, is 46.8% owned by businessman Dorel Goia and 12.2% held by private pension fund NN Pensii.
TRP shares have been trading up 102.1% since the start of 2020, amid deals worth RON200 million.