INTERVIEW - Serbia's Cini Sees 2009 Revenue, Earnings Flat Due to Crisis

Revenue is seen at 235 million dinars ($3.7 million/2.5 million euro) this year, Spasovic told SeeNews in an interview.

“We will be satisfied if our revenue and net profit remain unchanged,” he said. The company, based in the central town of Cacak, posted a net profit of 8.0 million dinars in 2008. 

“Our biggest problem is that our largest buyers are construction firms, and the construction industry was hit hardest by the crisis. So we stayed short of some payments. Many companies owe us money and a high number of them are blocked at present.”

About 10,000 workers in the country's construction sector have lost their jobs, the president of the Construction Materials Group with local Chamber of Commerce, Ljubodrag Knezevic, said in July. The dire situation in the sector has been caused by inadequate privatisation, the global financial crisis and the cuts in Serbia's public spending, he explained. Serbia's July construction output, measured by the estimated value of completed projects, fell 23.1% year-on-year, official statistics showed.

Cini, with domestic market share of 12% to 15%, invests about 300,000 euro a year in developing new products. Its biggest competitors are Italian and Chinese-based companies.

“Last year it was an insulation heater of Class II, which is now awaiting certification from European institutions,” Spasovic said. Heater Class II has undergone more sophisticated security checks measures to ensure greater safety for the consumer.

“We also have a new type of thin panel electrical heaters. They are three millimetres wide and 1.5 metres in length and 1.0 metre in height,” he added. 

The company sold a production licence and equipment to a company in Kazakhstan three years ago and is negotiating the terms of a similar sale to a Russian partner.

“Our capacity is such that it can very easily be doubled or trebled depending on demand. We produce and sell 250 000 elements of radiators but we think we can do a lot more and increase our market share. To do this, we need to make a new model that will have a lower sale price,” Spasovic said. Around a third of the company’s output is exported to countries of the European Union and former Soviet republics.

Two years ago Cini became a holder of the Guinness World Record Certificate for producing the largest radiator in the world. The radiator, 6.0 metres high and 6.0 metres long, was manufactured to mark the company’s 30th anniversary.

(1 euro=93.2550 Serbian dinars)