Slovenian appliance maker Gorenje reported an 8.8-percent rise in its net sales revenues for 2004, which topped 891 million euros (approx. U.S. $1.18 billion).
In line with recent announcements, the group's profits fell 3 percent short of forecasts, amounting to 20.44 million euros (approx. $27 million), up 3.5 percent over last year.
Gorenje had warned as early as mid-2004 that its profits could suffer as a result of rising raw material costs. Although initial estimates suggested the profit might even fall short of 2003 figures, the group managed to register growth.
The company said it was satisfied with the results given the difficult conditions the group had to work in last year. In addition to rising material costs, Gorenje said it also faced economic stagnation on key markets, such as France and Germany, and a weak dollar.
Gorenje previously announced in December 2004 that it anticipated revenues to grow by 11 percent to 980 million euros (approx. $1.3 billion) in 2005. However, the company warned that its profit would suffer as a result of new tax regulations in Slovenia.
According to the company, revenues are set to rise on account of the takeover of Czech company Mora Moravia, which is expected to generate 61.7 million euros (approx. $81.4 million) in net revenues. Nevertheless, net profit is expected to fall by 7.7 percent compared to this year to 18.77 million euros (approx. $24.7 million).
Gorenje says it expects that there will be no improvements in the operating conditions this year, with prices of raw materials likely to remain high. (Slovenia Business Week)
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