Viisnurk, which in Estonian means 'pentagon,' has been producing skis since 1964 and has been doing comparatively well taking into account that ski sales have decreased during the last few years due to bad weather.
World ski sales have decreased almost five times since the beginning of the 1990s, and now amount to about 1 million pairs a year. Viisnurk is the second largest producer after Austria's Fischer and produces about 200,000 skis annually.
Viisnurk's sales decreased by 23 percent last year following the world pattern, but the company managed to keep the same market share. It claims 20 percent of the ski market in Europe and the same share in the United States.
"We have preserved our market share," said Andrus Aljas, Viisnurk financial director.
Local top skiers like Kristina Smigun and Andrus Veerpalu, however, prefer Fischer's skis because Viisnurk does not produce top class skis and special ski products. The Estonian company produces mainly traditional skis which sell well and are also cheaper.
Viisnurk's skis were popular among top skiers during the Soviet times, when the company managed to sell 1 million pairs of skis per year to Russia. After independence, the company realized that the Eastern market was not available any more and turned to the West.
In 1991, it sold only 3 percent of skis to the West, but today this figure has reached 85 percent. Today, the share of skis to the Russian market is only 4 percent, and they are supplied only after payments are made.
"It was not easy to go to the West. It took a lot of time before we were accepted in the West and our sales increased. We had to sell [our products] at a low price at the beginning," Aljas said. "We achieved the competitive level thanks to our Western partners, with whom we are still cooperating."
Viisnurk does not produce skis under one trademark only. Skis carrying the local trademark Visu make only 10 percent of the total sales, and the company sells only about 10,000 pairs in Estonia.
The Estonian company also makes skis for other producers under the Karhu, Peltonen, Rossignoli and Atomic trademarks.
"Production has decreased in Europe. Our production environment is cheaper and other producers use our services. They make the top class skis themselves, as these require more technical secrets," said Aljas.
Aljas predicted the company's production will be more effective after it receives an ISO 9001 certificate this year. This will not only help to sell the skis but also cut costs and arrange production, he said.
The production of skis makes only one-third of the company's sales. Viisnurk is also producing soft board and furniture. Last year they started producing hockey sticks.
The company is planning to put more emphasis on the quality rather than the quantity and will start producing more expensive skis in the future.
Aljas believes that the decreasing sales of skis have already reached the world's minimum level and thus predicts the same turnover for ski production in 1999, which is 70.3 million kroons ($5.2 million).
The company's stock has been noted on the secondary list of the Tallinn Stock Exchange since June 1997. The small number of freely traded shares on the stock exchange makes the shares very unattractive for speculating investors. The share price decreased by 30 percent in 1998 to 18 kroons, while the stock exchange index TALSE decreased by almost 66 percent. The book value ofa Viisnurk share, which presently costs about 22 kroons on the exchange, was about 18.85 kroons at the end of last year.
The company's net turnover reached 202 million kroons and the net profit was 17.6 million kroons in 1998.