Polish soft drinks manufacturer Hoop, a significant player in the European soft drinks market, has announced a drop in profits for the financial year 2003 following an increase in expenditure related to the enhancement of production facilities and general financial expenditure.
The company reported a consolidated net profit of PLN 2.62 million (€589,000), down from PLN16.15 million in 2002. The drop in profit came despite a slight rise in consolidated revenue, which stood at PLN 350.7 million, up 0.2 per cent on the total for 2002.
The company's supervisory board said that progress had been in line with expectations and that its standing performance during the year has been assessed by the supervisory board as 'good'. It also said that, despite the drop in profits, it had managed to maintain its position in production and distribution of carbonated and non-carbonated drinks in line with the last few financial years.
Particular highlights of the performance included the continued increase in the sale of a number of new brands - specifically Arctic mineral water, which experienced a 50 per cent increase in its sales during the course of the year.
The year 2003 also saw the successful completion of company shares for public offering, which was said to have had a positive impact on the year's performance.
Hoop also completed a large-scale investment programme implemented with the intention of increasing production capacities, centering on the company's production plant in Grodzisk Wielkopski. With the addition of the company's other production facilities in Bielsk Pdlaski and Tychy, production capacity is now said to besufficient to meet plans to increase sales for both its own-brand and private brand labels.
Further to this production capacity has also been enhanced by the acquisition of a 50 per cent stake in Russian packaging company Megapack.
Hoop says that for the current financial year it is aiming to improve its profitability ratio through the adjustment of costs to level that correspond to its revenue from sales. For the longer term, the supervisory board said that during the course of the next two years a particular emphasis would be placed on increasing its sales in Russia as well as central and western Europe.