Alin Giurea, general manager of Pambac, one of the major players on the market of bakery products, announced only 18% of last year's income would be earmarked for dividend payments, unlike in previous years, when more than 60% of income went to dividend payments.
"This year, Pambac plans to begin major investments in pasta, and this is why a bigger percentage of the profit has been earmarked for this project," stated Alin Giurea.
Pambac in 2006 generated net income worth 1.6 million euros, which means it will direct around 300,000 to dividend payments, with the rest of 1.3 million euros being set aside for the investment programme. By comparison, the company allotted 85% of income for dividends last year, which means that shareholders received dividends worth 4.5 million euros from the 5.3 million-euro profit reported in 2005.
"Pambac invested over 26 million euros in the company's organic growth during the 1995-2006 period, with this sum largely coming from the profit we made. However, the firm still paid dividends each year," stated Giurea.
Last year, Pambac invested over 2.9 million euros (rate card) to promote its brands, one million euros of which were allotted to pasta. The producer intends to invest a similar amount in 2007, too, with the company to use this budget to regain its leading position on the pasta market and gain the second position on the flour market. According to the company's previous statements, Pambac will operate overall investments similar to last year's in 2007 and is going to invest around 5 million euros to boost production, logistics and distribution capacities.
For the near future, Pambac plans to step up its investments in new production capacities to cover market growth, the diversification of pasta offering, as well as to aggressively sustain the group's brands and strengthen its market share.
According to the company's representatives, at the end of 2006 Pambac accounted for 25% of the overall pasta market, 15% of the pre-packaged flour market, 10% of the maize market and was a domestic leader on the market of bakery products and specialties.
Pambac has recently elected a new board of directors to include seven instead of eleven members starting 2007. At the same time, the former chairman of the board, Ion Raducan, retired from his position and is to be replaced by Alin Giurea, who was the board's deputy chairman during the 2003-2007 period. Alin Giurea will also be the company's general manager, being supported by three vice-presidents. The Bacau-based producer in 2006 generated 41 million-euro turnover, up 32% against 2005 and posted 27% higher sales in terms of volume. This year, the company expects to derive turnover worth 49 million euros, 22% higher than in 2006 and income worth at least 2 million euros.
Pambac
Will earmark only 18% of income registered last year for dividend payments, unlike in previous years when dividend payments weighed over 60% of the income
Decided to cut dividends as it wants to start a major investment in pasta
Invested over 26m euros in 1995-2006 in its organic growth, with part of this sum coming from income
Invested over 2.9m euros to promote its brands
Plans to operate investments similar to last year?s in 2007
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