Latvian firm Valmiera Fibreglass claims it has produced and sold additional products worth some 800,000 lats in order to compensate for the fall in the Euro exchange rate and reach its annual sales ta…
Latvian firm Valmiera Fibreglass claims it has produced and sold additional products worth some 800,000 lats in order to compensate for the fall in the Euro exchange rate and reach its annual sales target for 2000 of 13.8 million lats. The company says 2000 profits will be hard hit by the fall in the Euro exchange rate – 60,000 lats instead of the profit target of 450,000 lats. According to Valmiera vice president Andris Brutans, countries of the Euro zone still represent the company“s biggest market. Of total sales of 13.8 million lats, in fact, 7.75 million lats are raised in European Union member states. Amid growing demand for fibreglass products, the company raised its prices on three occasions during 2000. In February, the price was increased by 3% on average, in July by 7%, and in early December by another 7%. Brutans said that opening of the company“s new production facility during 2001 will not change the export proportions in the very short-term. Valmiera will still export some 96-97% of output, 70% of which will go to Euro zone countries, nearly 20% to the US dollar zone countries and the remaining 10% to other currency areas. Valmiera has also said it could exit the bourse after summer 2002 when its privatisation investment programme is complete. “It is possible and it would be a normal business logic that this stock company be turned into a closed one,” said finance manager Imants Saulitis. Saulitis explained that the company could be delisted after its 49% owner German Glasseiden GmbH Oschatz raises its stake to between 77% and 78% through investments into the firm“s equity capital. According to privatisation rules, the German company must invest DM 35 million in Valmiera.