BAUMIX:  Mortar market will recover starting in 2011

• This year, the market dropped 30% over 2008

Officials of "Baumix" feel that the mortar market, which has been affected by a 30% drop in sales, will only recover in about a year and a half. According to a press release sent to our editors, the first signs for the recovery of the mortar market, which stood at 350 million Euros in 2008, will only become visible in the first semester of 2011. What"s more, officials of "Baumix" see another 5% drop in the mortar market in 2010 compared to 2009, due to the low number of construction permits issued so far.

Augustin Russu, general manager of "Baumix"; said: "Whereas in 2009 we benefited from the real estate projects for which construction began in 2008, we estimate that 2010 will be the most difficult year for the mortar market, due to the 10% drop in the number of new projects launched at the end of 2009 and those scheduled for launch in the first half of 2010. Following the signals that we have received from developers, we expect a recovery of the Romanian mortar market to begin in the first half of 2011".

Mr. Russu considers that the local market for mortar will take three years to reach the numbers of 2008, and the annual growth rate will not exceed 10-15%. These past few years, the annual growth rate was 30-40%, due the booming construction market.

Turnover of "Baumix" in H1 2009 increased 10% y/y, to 18,5 million lei. "Baumix" is one of the largest producers of construction materials, which has been present on the domestic market since 2003. The company has two factories located in Ploieşti and Gherla, with a monthly capacity of 35,000 tons a month.