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Wednesday, 01 April 2020
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Review and forecast: Helios Group

Thursday, 18 December 2008

Uroš Slavinec, President of Helios Management Board, Domžale, Slovenia, comments on the performance of his company in 2008 and gives an outlook for 2009.

Uroš Slavinec, President of Helios Management Board, Domžale, Slovenia Source: Helios

Uroš Slavinec, President of Helios Management Board, Domžale, Slovenia Source: Helios

In the review and forecast section of EUROPEAN COATINGS JOURNAL 1/09 Uroš Slavinec, President of Helios Management Board, Domžale, Slovenia, explains how the performance of his company was in 2008 and in which way the worldwide financial crisis affects his business. Furthermore he gives an outlook for the year 2009. Here are his answers: "Helios Group set an ambitious target for the year 2008 to reach EUR 384 million of net sales revenues, which would mean a 23 % growth compared to the year 2007. In the year 2008 we placed great importance to the Group’s consolidation, as in the recent two years some new company members joined Helios Group. We faced two different periods of the year. The first half of the year was marked with the further growth of the prices of raw materials and packaging in connection with the increase in prices of oil, steel. Helios Group succeeded in this period to follow the projected growth in sales and sales margins. Due to the rising inflation there was high pressure put on the costs for work labour in Slovenia, as well as in the countries of Central and Eastern Europe. Unexpectedly, the prices of financial resources and consequently financial expenses started to increase. In the second half of the year 2008 the economic growth stagnated and the financial crisis emerged. The financial resources became more expensive and were limited at the same time. The incurred circumstances, especially in the last quarter of the year 2008 indicate that the planned sales targets will not be reached, the same is true for the final results. The global financial crisis showed the global connections in the world. The crisis extended practically to all parts of the world over night and to all Helios’ sales markets and has already turned into the economic crisis the recession. Helios has been delivering paints and enamels into the market sectors, where the fall in the economic growth has an immediate influence. The financial resources are precious and limited, the orders were reduced, the stocks of products, which were produced from the raw materials of the third quarter of the year get smaller only very slowly. There is a large fluctuation in some local currencies, the buyers started to pay more slowly. At this moment it is shown that Helios’ decision on its conservative policy of financing the business operations with a sufficiently large equity capital share was correct. In spite of the intensive investments into the technology, distribution networks and capital mergers in the past years, we never allowed the equity financing resource to drop under 50 %. Currently, our main attention is focused on restrain of the negative influences of the financial and economic crisis in Helios’ business operations. The planned investments for the year 2009 will be limited to what is strictly necessary. Additionally, our great attention shall be directed to managing with current assets, credit and currency risks. We shall carry on the planned disinvestment of the programmes, which fall out of our core business. We shall continue with the consolidation of Helios Group, the emphasis will be set on the specialization of the production units and consequently the sale of business dispensable property. We shall carry on the planned introduction of the cleaner and eco-friendly products. In this year we concluded the investment into a new production plant for waterbased coatings. In the past year we opened a new production plant for powder coatings. In the year 2009 we shall start to introduce a uniform information system in all production units of Helios Group. In spite of less favourable outlooks for the year 2009 we shall set ambitious targets particularly in the sales sector. We are aware that the year 2009 will be one of the most difficult in the long history of Helios company."

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