November 1, 2022

Promateris posts a turnover of EUR 27.2 MIL in Q3 2022

Promateris consolidates its growth and reports a turnover of EUR 27.7 MIL in the first nine months of the year, with a slight upward trend compared to the same period of the previous year.

Promateris Q3 2022 Results

Promateris consolidates its growth and reports a turnover of EUR 27.7 MIL in the first nine months of the year, with a slight upward trend compared to the same period of the previous year. EBITDA for the third quarter reaches EUR 2.86 MIL.

2022 was a year of challenges, marked by macroeconomic instability, but also by the rapid increase in costs for: raw materials, electricity, financing costs. Despite all these difficulties, the slight upward trend in turnover demonstrates the solid market position and confirms the stability of Promateris' client portfolio. We have focused our efforts on operational efficiency, considering the accelerated growth cycle of recent years. Our future plans include an organic growth component, but we also consider M&A operations for new market penetration and for strengthening our leadership position in the CEE markets. We will continue investments in developing the production capacity of biodegradable and compostable packaging, as well as post consumer recycled packaging. Even though the market will be challenging, there will also be many opportunities, and we are ready to capitalize on them. We are confident that business growth will be possible through investments, such as the bio-compounding vertical integration and also through cost optimizations, through recovery, recycling and the transition to green energy, said Tudor Georgescu, CEO of Promateris.

The turnover in Q3 2022 reached EUR 27.2 MIL. The challenging market context was reflected mostly in the increase in operational expenses, having an impact on EBITDA, which reaches EUR 2.86 MIL. The global economic context had an impact on Promateris' results. Accelerated increases in expenses (raw materials, energy, financing expenses), but also the high level of inflation eroded the net result recorded in Q3 2022, reaching EUR 600K. Reduced consumption also contributed to the temporary slowdown of our growth. The sharp increase in interest rates also had a major impact, considering the sustained investments for the development of the production capacity. The EBITDA margin for Q3 is 10.5%, being significantly above the industry average, even in challenging market conditions, which demonstrates the resilience of our business model and shows the company's ability to generate value and to adapt to changing market situations. We forecast the EBITDA margin to increase in Q2 2023 following the operationalization of the bio-compound production investment in our Buftea plant.

In 2022, Promateris will continue to invest in the development of bioplastics capacity in order to consolidate its regional leadership position, followed by vertical integration through manufacturing the bio-based pellets. Promateris becomes the first player in Central and Eastern Europe to develop a raw material production capacity for biodegradable and compostable packaging. In 2022 and 2023, the company aims to enter new markets in the region and strengthen its position in the key CEE markets where it operates.

Promateris aims to diversify its product portfolio, by providing a wide range of products and services dedicated to the modern retail sector, but also to the e-commerce sector. Investments in our own R&D laboratory will allow us to develop new formulations for the bio-based compounds, but also for the production of multilayer packaging. Currently, Promateris products are used by local and international retailer stores that operate in the CEE region.

Our strategy also includes the development of PCR packaging (Post Consumer Recycled). Promateris launched Looper, the new brand from the industrial group's portfolio, which is targeting the modern retail segment.

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