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Snaige set to modernize, expand

  • 2004-12-22
  • Baltic News Service
VILNIUS - The refrigerator manufacturer Snaige said last week that it has applied for financial support from EU structural funds to modernize its production facilities at its central plant in Alytus.

"An application for EU support has been filed. If it is approved, we will completely renew our range of household refrigerators and expand production of commercial refrigerators," Giedrius Barysas, CEO of Snaige, told a news conference on Dec. 16.

"This would be a significant technological step forward and would bring us closer to the best known brands," he said. He would not disclose the price of the planned project, only describing it as "solid."

The modernization project will require two years to complete, he said.

The plant in Alytus currently has four technological lines. One of them - the commercial refrigerator line -does not meet the latest technological standards and needs to be upgraded. What's more, after the modernization project the plant will have six technological lines.

Snaige, one of Lithuania's largest companies, also said that the European Bank for Reconstruction and Development was willing to participate in its cooker plant construction project as a shareholder. The company has a potential strategic partner for this project in the West.

The company said it has worked out a project for expanding the annual production capacity of its refrigerator plant in Russia's Kaliningrad to 500,000 units and is about to start implementing it.

Also, it was announced at the same press conference that Mindaugas Sestokas, executive director of Snaige, will take up the duties of chief executive officer of the largest Baltic producer of household refrigerators in January.

"Our priorities for 2005 include the expansion of sales and marketing in Russia, retention of strongest markets in Ukraine and the Baltic countries, strengthening of all sales channels, in particular, in Russia," Sestokas, 32, said.

The new CEO would also be charged with implementing a number of cost-saving efforts, Barysas added.

Barysas, who was appointed Snaige's CEO in spring, will chair the company's board and also be in charge of the entire Snaige concern, which covers the plants in Alytus and Kaliningrad and the projected cooker plant in Russia.

Snaige announced that it expected to end the year with a pretax profit of 31.3 million litas (9.1 million euros), 26.2 percent higher than in 2003. Its annual consolidated profit should reach 28.8 million litas, up 24.7 percent year-on-year.

The refrigerator producer targeted a pretax profit of 34 million litas this year.

Hermis Capital, an investment company, controlled around 40 percent of Snaige's stock, including repo transactions and shares held by its partners, as of late November. Other major shareholders included customers of Estonia's Hansapank with 37.8 percent (as of late October) and customers of Sweden's SEB with 6.2 percent.