The companies owned by Romanian shareholders lost ground in front of those held by foreign investors (FDI companies) in terms of turnover.

Still, they are twice as profitable - according to a study by Ziarul Financiar daily based on data from the Trade Registry's Office.

Romanian-owned companies accounted for 44% of the aggregated turnover in the country in 2018, 1 pp less than the year before.

Foreign-owned companies accounted for 52%, while state-owned companies accounted for 4%.

However, the profitability of Romanian private companies calculated as a ratio between net income and turnover rose to 7.8%, up from 6.7% in the previous year.

By comparison, the profit margin of foreign companies remained constant at 3.7 %, shows the data from the Trade Registry.

Romanian private companies continue to dominate transport, construction, agriculture, the food industry, hotels, and restaurants. Meanwhile, foreign companies are strong in the industrial sectors: automobiles, machinery and equipment, metallurgy, chemistry, and oil refining.

Based on a continuously increasing profitability in the period 2014-2018, Romanian private companies recorded total net profits of RON 238 billion (EUR 50 bln) in the five years analyzed.

Out of this, the shareholders left only EUR 11 bln in their companies, given that the equity of Romanian companies increased from EUR 30 bln to EUR 41 bln during this period.

On the other hand, FDI companies obtained total net profits of EUR 35 bln in the same period from which they reinvested EUR 20 bln, increasing their equity from EUR 17 bln to EUR 37 bln between 2014 and 2018.

(Photo: Wanida Prapan | Dreamstime.com)

editor@romania-insider.com