Boromir’s profit reached €18 million in H1 due to land sale

 “Boromir registered a mere €5 million in profit from the milling and baked goods industry, with the remainder coming from from the sale of 2.5 hectares of land in Sibiu for €9.4 million, and the trade of several Boromir Buzau shares on the Stock Exchange,” Constantin Boromiz, General Manager of Boromir, told Business Standard.

The company registered €50 million in net sales in H1 2007, a 20 percent annual increase. It estimates €105-110 million worth of business in 2007, up 23 percent year-on-year.

According to Boromiz, the group has received and continues to receive offers from various investments funds and investors in Romania who wish to buy the company. One interested party is the Leipnik Lundenburger Invest group, controlled by Raiffeisen Austria, which acquired another baked good producer, Loulis, one of the major players in this industry. “We participated in negotiations, but I do not want to sell Boromir because this is what we live off, and it is a family business, with tradition,” Boromiz added.

The General Manager said he is always looking to buy something profitable, such as factories producing well-known brands, which he could acquire in the next 2-3 years. “It is more profitable for me to buy an existing company than to start a business. Five years is not enough for me to make a profit, since there is both loyal and disloyal competition on the market,” Boromiz said.

The group intends to invest €5 million in its business in 2007. The domestic baked good product market is estimated by Boromiz to be worth €2 billion, and main players are Boromir, Vel Pitar, Loulis, and Panbac.

Boromir has a 10 percent market share and hopes to extend this to 15 percent in the coming 3-4 years, as a result of the company’s consolidation policy, Boromiz said. He further believes that medium-sized producers will disappear from the market in a few years. “You are either big or small. Only the smallest will hold on, those with family businesses, and the largest, who invest in modern technology and increased capacity,” Boromiz believes.

Annual bread consumption in Romania is 113 kg per capita, compared to less than 100 kg in other EU countries.