Aircraft manufacturer Aerostar Bacau made net profits of 1.9 million RON (over 0.5 million euros) in the first half of 2005, around 90% more than at the same time last year.
The level of sales, however, remained relatively constant at 13.2 million euros (48.3 million RON), compared with 12.8 million euros (51.6 million RON) in the first six months of 2004. The large rise in profits was primarily due to the strongly improved results from financial activities. The company''s financial income amounted to more than one million RON (296,000 euros) over the first six months, almost equalling operating income. Aerostar''s management could not be reached for comment.
The bulk of Aerostar''s sales were made on the domestic market, accounting for 74% of its turnover. Still, exports were better than last year, as their share in total sales increased from 17% to 26%, with the main export market being Asia.
The ROL/USD and ROL/EUR exchange rate trends over the first six months affected the company''s results negatively, as a significant part of its revenues are derived from exports. This is why Aerostar began a programme aimed at helping it avoid crisis and achieve the performance targets set in its spending and revenue budget.
Aerostar''s S&R budget uses an average euro exchange rate for 2005 of 3.7 RON, compared with 4.2 RON last year.
A number of steps have been taken as part of this programme in the second quarter of the year, including cutting material, utility and personnel costs. This meant 314 employees were laid off, so that the company ended June with a workforce of 1,710.
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