ROCA Industry reports higher turnover after pursuing M&A strategy

ROCA Industry, a major industrial holding of construction materials in Romania, owned by ROCA Investments, reported a turnover of RON 289.5 million (EUR 58.5 mln) at the cumulative level of productive companies, in the first semester of 2023.

The holding registered an increase of 5.7% in turnover compared to the same period in 2022.

In a temporarily contracting market context, the cumulative EBITDA at the level of the productive companies in the holding reached the value of RON 17.9 mln, registering an EBITDA margin of 6.2%.

In the first half of the year, the companies in the ROCA Industry portfolio gained important market shares. EVOLOR, the manufacturer of paints and varnishes, recently relaunched and undergoing a period of operational transformation, recorded sales increases of 21% compared to the same period last year, and ELECTROPLAST, a company producing electrical cables, recently entered into the holding’s portfolio, reported an 11% advance in first half sales volume.

The goals achieved in the first half of this year include the expansion of ROCA Industry’s portfolio through mergers and acquisitions strategies. The company recently acquired ELECTROPLAST, the market leader in electric cables for railway infrastructure, and Iranga Technologijos, from Lithuania, through the company BICO Industries, directly owned. In addition, the holding is in advanced discussions for the acquisition of Workshop Doors, one of the key players in the interior door market in the country.

“Opportunities, even in times of economic unpredictability, come from resilience and consistency. That is why we remain consistent in our investment strategy, expanding the markets we operate in and infusing added value at the level of all the activities of the holding company. We have promised 3 acquisitions, so far we have completed 2, and the third is in advanced negotiations. [...] We are also focused on developing a stable customer base that can ensure accelerated growth when the market recovers. We believe that a period with many opportunities is ahead, and our stake is to capitalize on as many of them as possible,” said Ionuț Bindea, CEO of ROCA Industry, cited in the press release.

The holding is also expanding its export activities, with its companies accessing new foreign markets for the sale of construction materials in 2023, in countries such as Great Britain, Switzerland, Moldova, Israel, and others.

The main objective of the holding for this year is the capital increase and the transition from the AeRO market to the main market of the Bucharest Stock Exchange.

Outlooks from major statistical and forecasting organizations point to a cyclical slowdown in the construction sector, characterized by high pressure on margins. ROCA Industry specialists estimate that the situation will continue in the 3rd quarter, under the impact of fiscal changes in the construction sector and, implicitly, the demand for construction materials. However, after this period, a sharp growth curve is expected in the longer term, in the next 3-5 years.