DUNAPACK MAGYARORSZÁG ANNUAL REPORT P A C K A G I N G

Transcription

1 DUNAPACK MAGYARORSZÁG P A C K A G I N G ANNUAL REPORT

2 DUNAPACK KFT. ANNUAL REPORT 2011 Although Hungarian economy started to emerge from recession in 2010 the dynamism of the increase in 2011 was low-down. Industrial sales remained the source of marginal growth based on strong external demand. Slowing down business prosperity within the European Union, unpredictable Hungarian economic background, hectic development of the Hungarian forint exchange rate, record breaking fuel prices, and high unemployment created extremely hard business environment for the Hungarian enterprises. Unfavourable external and internal circumstances have negatively influenced Dunapack s business opportunities as well. The consumption of paper based packaging materials was stagnating in 2011 while the proportion of incoming import goods increased. Paper prices were increasing and then started to decrease but their decrease was compensated by the weakening forint. In order to counteract the negative impacts, Dunapack Kft. intensified sales activities and implemented considerable cost savings. Shifting the affects of the paper price increase to customers could be realised with active efforts on the market but only with some delay. Therefore profitability was low in the first half of the year but its increase accelerated from the second half of the year. Thus done efforts were successful. Sales quantity remained only slightly below the planned and previous year s figure. On the other hand profit before taxes exceeded both profit in 2010 and profit planned for 2011 significantly. Therefore we can proudly state that our company closed a successful business year in Based on the owner s decision it was an essential step in Dunapack s life that the legal form of the company was changed from a joint stock company (Zrt.) to a limited liability company (Kft.). The change aimed the simplification of procedures and that our company could comply with international challenges more quickly and more flexibly in all fields. In 2012, due to further on stagnating economy, uncertain economic environment, moderate investment activity and increasing taxes (VAT, excise tax, product fee) decreasing demand is to be expected. All these impacts reinforce us to continue the commenced steps and to stay on this path. Dunapack Kft. has to find the way of growth within its own opportunities, i. e. intensifying sales activities and reaching real, acceptable cost savings. Dunapack Kft. Budapest, Dunaújváros Economic difficulties did not leave the demands of the corrugated market untouched. Earlier organic expansion (2-3%) vanished and the demand of the Hungarian market remained in 2011 at almost the same level as in 2010, while imports showed strong growth. This trend remained quite stable during the first 8 months of the year because the HUF/EUR exchange rate did not move extremely. The deterioration of the forint beginning from September slightly pressed back imports. 1

3 Government measures unexpected and unpredictable for foreign countries caused further uncertainties on the money and capital markets. Households and enterprises had to suffer the impacts. Also, the FMCG (fast moving consumer goods) sector and most of the electronic companies were forced to book high losses. Looking at domestic sales to different industry sectors Dunapack realized significant volume loss at sheet converter, household chemical, cosmetics, and household engineering industry partly due to the market situation partly due to strategic considerations. These losses could not be fully compensated by positive sales results to poultry, tobacco, refrigerating, pharmacy, and meat industry. On the export markets the sales to Slovakia strongly exceeded (by 156%) the planned figures. During the year 2011, a new corrugated producer entered the domestic market. In 2012 they are about to launch significant capacities in Hungary. Parallel to the deterioration of the forint exchange rate we managed the keep product prices at the original level. Positive effect of the exchange rate development was that the coverage of our sales in foreign exchange ameliorated. As a result of all above impacts the company was able to realize its quantity targets in 2011 to 97%. Dunapack Kft. Nyíregyháza Although on the domestic market, besides few exceptions, general weakening of the Hungarian producers could be experienced, and although imports were increasing, the company could deliver to its customers at the same level as in the year This is a highly valuable achievement considering that sales quantity was down owing to the loss of significant partners and key account customers. These losses could be fully compensated, but there was no chance of reaching the expansion planned for The export sales exceeded previous year s and planned sales quantity figures as well. Source of the increase was export to Ukraine and Romania. Analysing the industry sectors increasing sales results were accomplished at sheet converters, in the other food sector, at pharmacy, and also at fruit and vegetable sector which showed decreasing trend during previous years. This year is going to be really challenging because we are expecting Hungarian corrugated producers trying to counterbalance suffered quantity losses with aggressive market policy in In Eastern Hungary beyond a new player entering the market now also a Romanian company working with very aggressive price policy is present. Overall, the sales plans for 2011 were successfully realised to 101%. 2

4 Raw material supply The raw material supply was satisfactory in general. Although delivery deadlines could not be kept occasionally, due to logistic reasons, especially in case of group internal paper suppliers. The sources were used according to plan whereas there were some regroupings to small extent among the suppliers in order to optimize quantity discount. Although paper widths were standardized an alternative width (185 cm) was introduced in the second half of the year. Total quantity of containerboards purchased in 2011 decreased proportionately to the quantity development in production. Paper stocks were slightly fluctuating but, owing to the controlled paper stock management, it stayed at continuously low level. Therefore the average value remained below the strongly decreased planned stock level. Price of native starch, gluing raw material for the corrugator bought in the form of powder and water suspension in 25-75% proportion, also increased considerably. Its price was rising gradually (between January and December altogether by 33%). Our investment activities in 2011 were moderate and mainly focusing on modernisation and production rationalization. For stabilizing investments 450 M HUF was spent in spite of the planned 711 M HUF. Regarding to our environmental protection activities we can state that the yearly renewal audit of both the ISO environmental management and the OHSAS occupational health and safety systems encompassing overall activities of Dunapack Kft., at all sites in Hungary, was completed successfully in The surveillance audit in 2011 was also carried out successfully. On the basis of this, the certification of the integrated management system remains valid until July On the Budapest site of the company, sanitary sewage water and pre-treated technological waste water which was earlier flowing to the stream-channel of the river Danube is connected from 2011 to the public canal system. Thereby the waste decreasing program determined in the resolution of the Middle - Danube - Valley Inspectorate for Environmental Protection, Nature Conservation and Water Management was fulfilled. Rain-water flows from the plant to the stream-channel of the Danube river, since the waste water was connected to the public canal system. Emission of air polluting point sources operating on the sites of Dunapack Kft. is below the limit. The quality of waste water flowing into the public canal system met the relevant regulations on the basis of the measurement results received at self control. Waste arising on the sites of Dunapack Kft. is handled according to the prevailing legal regulations. Research and development activity involved product and, to a lesser extent, technological development projects. In 2011, we accounted HUF 59 million as R&D expenditure. 3

5 Profitability Overall, the consolidated balance sheet and profit-and-loss statement of the company for the year 2011 give account of a liquid company with a favourable structure of assets and liabilities. No material event affecting financial position and the accurateness of the report has taken place after balance sheet date. Budapest, 17 February 2012 Rafael Sieben managing director Attila Galambos managing director 4

6 VALUE OF PRODUCTION (HUF million) DOMESTIC export AFFILIATED FACTORY CHANGE IN INVENTORIES DOMESTIC export AFFILIATED FACTORY CHANGE IN INVENTORIES total: total: KEY FIGURES (HUF million) Net sales revenue Operating profit Financial profit or loss Profit or loss on ordinary business Profit or loss on extraordinary business Pre-tax profit

7 BALANCE SHEET (HUF million) Fixed assets Intangible assets Tangible assets Investments Capital and reserves Of which: called up share capital Provisions Current assets Inventories Debtors Securities 0 0 Creditors Long-term liabilities Short-term liabilities Liquid assets Prepaid expenses and accrued income Total assets Accrued expenses and deferred income Total liabilities PROFITABILITY AND EQUITY RATIOS Profit or loss on ordinary business level 6.9% 14.5% After tax profit level -3.6% 14.9% Profit and loss account level -3.6% -18.2% Remark: 2010 year s figures are all Dunapack Zrt. figures, while figures of 2011 are until 30 September 2011 Dunapack Zrt. figures and from 1 October 2011 Dunapack Kft. figures. 6

8 DUNAPACK MAGYARORSZÁG P A C K A G I N G H-1215 Budapest, Duna u. 42. Phone: dunapack@dunapack.hu