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PREBET SA AIUD - PREB

2017 Q3 report

Release Date: 11/13/2017 8:03:46 AM

IRIS Code: D7652

Quarterly Report according to

National Securities Commission Regulation no. 1/2006

3rd QUARTER of 2017

Date of report for 13.11.2017

 

 

S.C. PREBET AIUD S.A.

Registered Office : AIUD, Str. ARENEI, Nr.10, Jud. ALBA

Phone number : 0258 / 861661 ; fax : 0258 / 861454

Number and date of registration in the Trade Register Office : J01/121/1991

Tax Identification Number : RO 1763841

 

 

 

1. ECONOMIC AND FINANCIAL STATEMENT

 

a.     STATEMENT OF FINANCIAL POSITION

 

 

                                                                                         01.01.2017                       30.09.2017

Tangible assets

13.061.174

14.146.369

Financial assets

-

-

TOTAL FIXED ASSETS

13.061.174

14.146.369

Stocks

4.561.611

4.994.553

Trade receivables

11.259.940

10.910.725

Cash and cash equivalents

8.172.328

7.366.633

Other assets

-

-

TOTAL CURRENT ASSETS

23.993.879

23.271.911

1.TOTAL ASSETS

37.055.053

37.418.280

Share capital

8.199.548

8.199.548

Adjusment of capital

57.644.064

57.644.064

Other components of own capital

- 647.854

- 647.854

Share premuim

-

-

Revaluation reserves

3.779.677

3.716.085

Reserves

14.858.327

16.080.724

Retained earnings except that form the adoption for the first time of IAS 29

- 63.521.958

5.344.529

Retained earnings from the adoption for the first time of IAS 29

5.280.937

- 63.521.958

Profit at the end of the reporting period

2.647.696

1.278.314

Distribution of profit

-149.815

-

2.TOTAL EQUITY

28.090.622

28.093.314

Long terms loans

-

-

Deferred income tax liability

604.251

604.251

TOTAL LONG - TERM LIABILITIES

604.251

604.251

Trade paybles and other paybles

3.758.047

4.593.226

Short term loans

-

-

Current income of liability

-

-

TOTAL SHORT – TERM LIABILITIES

3.758.047

4.593.226

Subsides for investment

1.820.652

1.712.211

Provisions

2.781.481

2.415.287

3.TOTAL LIABILITIES

37.055.053

37.418.280

           

 

 

 

b.     STATEMENT OF REVENUE AND EXPENDITURE

 

 

 

                                                                                               30.09.2016                       30.09.2017

NET TURNOVER

22.366.138

18.624.802

Income cost products stocks

( 386.917 )

240.716

Incomes from production of tangible assets

0

328.424

Other income

247.224

207.673

OPERATING REVENUE – TOTAL

22.226.445

19.401.615

Raw materials and consumables used

10.591.232

9.802.092

Other material expenses

61.239

55.279

Other external expenses  ( for energy and

water )

717.041

685.685

Expenses on goods

136.270

78.572

Trade discounds received

( 29.915 )

-6.454

Staff costs , of which  :

5.279.805

5.155.448

- Wage and allowances

4.265.669

4.172.611

- Expenses on social security and welfare

1.014.136

982.837

Value adjustment on intagible and tangible assets , property investment and biological assets meansured at cost.

705.123

780.082

Expenses

705.123

780.082

Revenues

0

0

Value adjustments on current assets

- 65.005

- 13.655

     - Expenses

1.703

-

     - Revenues

66.708

13.655

Other operating expenses , of which

1.475.693

1.719.978

- Expenses on external supply

1.265.999

1.541.330

- Other taxes , duties and similar expenses

146.096

111.955

- Other expenses

63.598

65.430

Adjustments for provisions

589.492

- 366.023

OPERATING EXPENSES – TOTAL

19.460.975

17.890.824

OPERATING PROFIT OR LOSS

2.765.470

1.510.791

Revenues from participating interests

0

0

Other financial revenues

20.156

34.698

FINANCIAL REVENUES

20.156

34.698

Interest expenses

0

0

Other financiar expenses

27.241

61.082

FINANCIAL EXPENSES

27.241

61.082

FINANCIAL PROFIT OR LOSS

- 7.085

- 26.114

TOTAL REVENUE

22.246.601

19.436.583

TOTAL EXPENSES

19.488.216

17.951.906

GROSS PROFIT

2.758.385

1.484.677

TAX REVENUE

412.067

206.501

NET PROFIT

2.346.318

1.278.176

 

 

EXPLANATORY NOTE:

 

I.                   SITUATION OF ASSETS, LIABILITIES AND EQUITY OF S.C. PREBET AIUD S.A ON 30.09.2017 IN COMPARISON TO 01.01.2017

 

            The value of the fixed assets of the Company in the reporting period, namely 01.01.2019 - 30.09.2019 increased from 13.061.174 lei 14.146.369 lei the increase of 1.085.195 lei being due to the fact that during the analyzed period the volume of amortization was higher than the volume of investments.

           

The value of the net current assets of the company in the reporting period (01.01.2017-30.09.2017) decreased from 20.091.244 lei to 18.534.097 lei , the decrease of 1.577.147 lei is partially due to the reduction of trade receivables and liquid assets.

The company’s total amount of debts( wich are totally current liabilities ) for the reporting period (01.01.2017-30.09.2017) increased from 3.758.047 lei to 4.593.226 lei , the increase of 835.179 lei representing debts to the suppliers , debts to the state budget , advances cashed from the clients.

The value of trade receivables of the Company in the reporting period, namely 01.01.2017 - 30.09.2017 decreased from 11.259.940 lei to 10.910.725 lei, with a difference of 349.215 lei.

This diminution the commercial receivables was due to the diminishing of turnover in this period due to several factors including the lack of demand resulting from the reduction of investments in the road and railway infrastructure in Romania.

Cash and bank accounts (liquid assets) of the Company in the reporting period, namely 01.01.2017 - 30.09.2017, decreased from 8.172.328 lei to 7.366.633 lei, with a decrease of 805.695 lei.

 

 

II.    SITUATION OF MAIN INDICATORS OF S.C. PREBET AIUD S.A. ON  30.09.2017 IN COMPARISON WITH 30.09.2016

 

The reduction in the volume of investment in infrastructure in Romania has led to a decrease in the demand for prefabricated both in the road and railway infrastructure.
           This led to a decrease in the turnover and total revenues of our company, partly anticipated by the company's management since the drafting of the Income and Expenses Budget for 2017, subject to approval by the General Meeting of Shareholders.
           Despite all the difficulties encountered, the Board of Directors and the executive management of the Company have made and will make sustained efforts, assuring the shareholders and potential investors to achieve the objectives proposed by the BVC, especially the profit.

In comparison with the economic - financial situation for the similar period of 2016, the achievements over the reporting period were much better.

The main decrease was registered in the turnover indicator, from the value of 22.366.138 lei to the value of 18.624.802 lei, with a difference of 3.741.336 lei, the percentage of realization 83,27%.

            Among the factors that contributed to this situation we mention:

§  In the first part of the analyzed period, unlike the similar period last year, the temperature was very low, which made our beneficiaries (the builders) unable to work on the construction sites.

§  Lack of demand for products, our beneficiaries demanding the postponement of the delivery of the contract products.

            The total revenue indicator decrease of 2.810.018lei (87.37%), decreasing from 22.246.601 lei to 19.436.583 lei.

The total expenditures amounting to 17.951.906 lei were lower by 1.536.310 lei, in the amount of 92.12% compared to 19.488.216 lei.

Related to this, there were decreases in the consumption of raw materials and personnel and personnel expenses, expenses on provisions.

Gross profit recorded a sharp decline from 2.765.470 lei at 1.484.677 lei due to lower revenues.

However, there is a premise that the gross profit set by BVI for 2017 will be achieved.

 

2.     ANALYSIS OF THE TRADING COMPANY ACTIVITY

 

2.1        Below we shall present and analyze all events or uncertainty factors that affect or could affect the company's business compared to the same period of the last year.

   

 

Among the risks to which the company was exposed we name:

 

§  Risk of emerging market;

§  Risk of political instability;

§  Risk of changes to tax legislation;

§  Risk of default payment (credit);

§  Risk related to permits and licenses;

§  Economic and financial risk;

§  Competition risk;

§  Operational risk.

 

Risk of emerging market:

 

Although Romania is a Member State of the European Union, even if this status ensures premises for continuing the structural reforms and improvement for the the business environment, there are risks (unanticipated events), associated with an emerging market economy as it is still considered Romania, able to significantly affect the activity of the company, its development opportunities and its financial perspectives. Among the features of an emerging market those that could affect most of our company's activities are the volatility of interest rate and of the exchange rate, even if the evolutions in the analyzed period suggest some stability of these financial variables.

 

Risk of political instability:

 

Political instability may result in delaying the implementation of structural reforms aimed to support a sustainable development of the Romanian economy and to promote the creation of an economic and financial infrastructure that increases attractiveness of foreign direct investments and/or the portfolio. A negative perception of the Romanian political class can influence the volume, character and structure of investments in Romania, foreign and/or domestic. Political instability may have wide negative effect on confidence of resident or non-resident investors, regarding the degree of liquidity and capitalization including the stock exchange quotations.

 

Risk of changes to tax legislation:

 

The risk of political instability in Romania, leads to the risk of changing in the tax legislation, leading to a further possible negative impact on the company's activity and/or gains made by investors from owning or trading of shares (raising taxes, introducing of new taxes, reduction or suspension of tax incentives, etc.). There is a risk that the company or the investors in its shares, to be exposed in the future to quotas increased by taxes or new taxes (additional) that can not be currently predicted or estimated.

 

Risk of default payment (credit):

 

The risk of default (credit) is the risk that the company would incur a financial loss as a result of non-fulfillment the contractual obligations by a customer or in counterparty to a financial instrument, and this risk mainly result from trade receivables.Company’s exposure to credit risk is influenced mainly by the individual characteristics of each client. To counter this risk factor the company applied and applies restrictive policies of delivery to uncertain customers, subject to payment by them in advance of the products delivered and/or the issuance by them of certain payment instruments (guaranteed promissory notes in own name and/or letters of bank guarantee).

 

Risk related to permits and licenses:

 

The company's activity is subject to the obtaining of permits and licenses specific to the business domain, namely the production of precast and prestressed concrete for road and railway communications routes. Any changes in the conditions required to be insured by the company or in the maintenance requirements of these permits and licenses, including changes in criteria for obtaining or renewal thereof, may adversely affect the company's business or financial outlooks.

 

Economic and financial risk:

 

The activity, financial situation and company’s perspectives depend on the development level of economy and the capital market in Romania, and consequently on the volume and value of transactions in the capital market. The international financial crisis affecting economies and worldwide capital markets could have negative effects that are difficult to be assessed within Romanian economy, national currency and within the market that operates the company (the issuer), resulting in lowering the volume and the transaction value, namely decreasing the price of Financial Traded Instruments. Negative effects on the Romanian economy could lead to diminishing of the purchasing power and financial resources of companies and individuals in Romania, including those that are trading on the Bucharest Stock Exchange, where the company is listed. Liquidity and prices over regulated capital markets in Romania are affected directly or indirectly by the evolution of international capital markets. The risk of regional instability amid armed conflicts, can also cause substantial financial losses that are hard to be anticipated at the time of preparation of this analysis.

 

Competition risk:

 

Board of directors of the Company considered that the date of this analysis, there is a risk of competition to the markets where it operates. To mitigate its effects and consequences, Prebet company must deliver to customers high quality products at an affordable price, achievable goals constantly in reducing expenses through a judicious use of resources, both material and human.

 

Operational risk:

 

Operational risk is the risk of direct or indirect losses, arising from a variety of causes associated with processes, personnel, technology and infrastructure of the company and also to certain external factors other than credit risk, market risk and liquidity risk, as those coming from legal and regulatory requirements and generally accepted standards of organizational behavior.

Operational risks arise from all the company's operations. The main responsibility of developing and implementing operational control risks belongs to the Company's management. The responsibility is supported by the development of general standards of the company that manages the operational risk, considering the following directions:

§  Separation requirements of responsibilities by their individualization;

§  Compliance with the legal requirements relevant regulation;

§  Periodic review of operational risk it poses which the society is exposed to and the implementation of controls and procedures to prevent the identified risks;

§  Reporting requirements of operational losses and proposals to remedy the causes that generated them;

§  Preparation of development plans and professional training;

§  Establishing ethical standards;

§  Preventing the risk of litigation including insurance where it applies

 

2.2  After the years 2013-2014, when was held a wide-ranging refurbishment of the company, by acquiring six goals contained in the investment program,,Introduction of New Technologies and the Technological Modernization of the Company Prebet" program supported by accessing European funds during year 2016 will be held project investment according to B.V.C.

 

3. Changes that affect the share capital and the management of the trading company: Was not appropriate.

 

3.1 Describe any situation in which the company was found in the impossibility to observe its financial obligations during that period: Was not appropriate.

 

3.2 Description of any change regarding the rights of holders of securities issued by the company: Was not appropriate.

 

4. Significant transactions: Was not appropriate.

 

 

 

 

Administrator,                                                                            Prepared by,

 

Name and first name : RACASAN STEFAN                            Name and first name  : CIMPEAN IOAN

Title : General Manager                                                              Title  : Economic Manager

 

Signature                                                                                     Signature

Stamp of the unit

 

 

The quarter Report at 30.09.2017 will be available for shareholders and investors starting with 13.11.2017, 08:00, both hard copy at the Company’s premises and in electronic format on the website, www.prebet.ro section ,,Investor Relation / Regular Reports’’, as well as in the link below:

 

 

 

 

 



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