Frigocarne - Iasi Profit Down 9 Times

Doru Mocanu,

IaŞi

Frigocarne S.A. - Iasi (RASDAQ:FGRC) concluded last year with a profit of 113,206 RON, down 9.4 times from end-2007. The company used 7,536 RON from this profit to constitute legal reserves and will allocate the remaining funds after the conclusion of ongoing litigations about the ownership to certain plots of land tied to the company. Frigocarne S.A. had obtained deeds to plots of land formerly managed by the State-owned company from which Frigocarne S.A. was created. The land in question was originally confiscated by the State prior to the anti-communist revolution in 1989. Some of the initial owners claimed back their property and the cases are currently tried by various courts.

Frigocarne was established through the reorganization of State Meat Industrialization Company - Iasi as an enterprise specialized in the supply of raw materials as well as in the industrialization, storage and marketing of meat and meat by-products. The company is also provides various services to business customers and performs import-export operations. As of 2003, the company changed their core business to leasing and sub-leasing proprietary or rented real estate assets. Frigocarne concluded last year with a turnover of 76,528 RON derived exclusively from rentals. Compared to the previous year, the turnover only increased by 6,000 RON.

Operating revenues amounted to 449,104 RON, down 4.4 times from 2007, while operating expenses decreased from 763,572 RON in 2007 to 348,812 RON in 2008. The company therefore closed the year with an operating profit of 100,292 RON and a financial profit of 50,348 RON. The difference between the overall revenue of 499,452 RON and overall expenses of 348,812 RON led to a gross profit of 150,640 RON and a net profit of 113,206 RON, much lower than the 1,071,064 RON net profit reported at the end of 2007.

According to the latest available information, the company is controlled by the businessman Danut Prisecariu with 53.85%. The State Assets Recovery Authority (AVAS) holds 30.42%, while smaller shareholders share the rest.