Simona: Double digit sales growth

Simona Group, headquarted in Kirn, Germany, has continued double digit growth, with sales rising 14% in 2006 to €262.8m. The manufacturer of plastic sheet, pipe and rod had growth rates of 22.4% in 2005 and 8.4% in 2004.

Exports were again the driving force behind the growth, Simona pointed out. Sales in Germany grew by 12.5% to €97.5m, despite the results including a contribution from the acquisition of Deutsche Holzveredelung Alfons & Ewald Schmeing. The company said however that domestic demand in Germany has started to revive, for the first time since 2000.

Earnings (EBIT), at €14.9m, have not kept pace. The company’s 5.7% return of EBIT against turnover was below Simona’s 7% target, up from 5.4% in 2005, but below the 6.8% achieved in 2004. This has been mainly on account of a rise of more than 19% in raw material costs, as well as higher staff costs and significant increases in the cost of energy and freight.

Against a background of strong competition, Simona said that it has not been able to fully pass these costs on to its customers.

Looking ahead, the company is optimistic about being able to stabilise EBIT in 2007 to the level of 2006. It said that this should be achieved through “measures to increase the company’s efficiency, with simultaneous cost optimisation”.

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