Romania's Prefab posts drop in net profit in 2023

Prefab’s turnover increased by an annual 16.7% to 110.2 million lei last year, the company said in a financial statement filed with the Bucharest Stock Exchange.

The company's operating result dropped to some 3.3 million lei in the twelve months through December 2023, compared to over 10.6 million lei recorded in 2022. The drop was due to an increase in production costs, Prefab said.

"Currently the most worrying phenomenon is the increase in inflation, which has led to a decrease in demand in the building materials market due to the decrease in purchasing power and the shift towards existing products by consumers," the company said.

Also, limited national infrastructure projects, a shortage of skilled labor, and financial bottlenecks in the national investment field restrict growth of the local market for precast parts. While investments from European funds are crucial for the Romanian economy, their slow absorption further impedes progress in this sector, the company noted.

The company’s total revenues came in at 120.6 million lei at the end of 2023, more than doubling on the year. Total expenses rose by 133.3% to 119.4 million lei.

Prefab’s total assets increased to 257.4 million lei in the year under review, from 255 million lei in 2022.

Prefab was founded in 1967 as a state-owned enterprise and was privatised in 1998. Since 2009 it has been the largest Romanian producer and supplier of autoclaved aerated concrete, according to data published on its website.

Prefab shares traded 7.78% higher at 3.6 lei as at 1148 CET on Monday on the Bucharest bourse.

(1 euro=4.97211 lei)