Overall, three-quarters of the companies in the top 40 [for the country] are growing at double-digit rates in 2022, with only 3 reporting a slight decline in revenue.
- The revenue growth of the largest companies [in Bulgaria] in the sector accelerates to 28.7% in 2022.
- The increase is the result of increased demand and restored supplies after the pandemic, but inflation also plays a role.
- Forecasts for 2023 are generally for additional growth, a weaker year for bicycle manufacturers.
Missing from the ranking are large companies such as the manufacturers of automotive components “Costal Bulgaria Automotive”, “Teklas – Bulgaria” and “Yazaki Bulgaria”, which did not provide data. Judging by their results for 2021, they would add nearly BGN 1.7 billion to the total turnover
The trio of champions
Probably because of the absence of these companies, but also because of its strong growth of over 87%, the Plovdiv bicycle manufacturer Maxcom, whose revenues already reach nearly BGN 750 million, is at the top of the ranking. Recently, the company commented on Capital, that at the beginning of 2022 orders were three times the capacity of the plant. Therefore, last year too, Maxcom started an investment for BGN 60 million, expanding its production areas, and this year it is also building its own logistics center. However, the main reason for the jump in revenue is the change in the portfolio and the higher average price of the products. “This is not related to inflation, but to the migration from conventional to electric bicycles,” explained financial director Nikolay Boyadzhiev. According to him, the share of electric versions is 80% of the production, and the price for them increases from 900 to 1200 euros.
Another representative from Plovdiv – the medical equipment manufacturer BTL Industries – is in second place, growing by more than 42% after practically doubling its turnover the previous year. With a profit of nearly BGN 189 million in 2022, the company continues to maintain one of the highest levels of profitability in the sector. “Last year’s growth was due to the new technologies introduced into production, as well as the increased demand for medical services after covid,” explained Executive Director Georgi Petkov. The company produces devices for cardiology and physiotherapy, as well as for aesthetic medicine, which are also the main engine of recent growth. They will also be behind the expected 20 percent increase in revenue and profit this year. BTL Industries is currently building a new plant in Plovdiv, which is expected to be operational in 2024. “A large-scale investment in machinery and equipment is planned, as well as the launch of two new productions of radically different products,” explained Petkov. This will add another 20% to the company’s revenue next year as well.
The top three is completed by another company with a presence in Plovdiv – “Sensata Technologies Bulgaria”, which, in addition to the City under the hills, also has a plant in Botevgrad, as well as a large R&D center in Sofia. The company produces sensors mainly for the automotive industry and is owned by the American Sensata Technologies. It is also the largest employer among the top 40 firms in the sector that provided data. The company does not give an official forecast for this year, but they indicate that their business is developing very well and they expect an improvement in all indicators.
Who is the best
In addition to turnover, Maxcom is also the leader in terms of growth among the 40 companies last year. By more than 80%, the manufacturer of hydraulic cylinders “Kashif”, which occupies the second position among the most dynamic machine-building enterprises, increased its revenue. The company already has three plants in Jebel and Kardjali, and is preparing a fourth in two years, and the production is exported all over Europe. The turnover of the manufacturer of gambling equipment “Euro Games Technologies” increased by nearly 77%, which raised it to fourth place in the sector.
For the Home
The Plovdiv manufacturer of white goods Liebherr – Hausgerete Maritza ranks fifth in terms of revenue, growing at a more moderate 3.6% against the background of double-digit jumps for a large part of the companies in the sector. This is not the only investment of the German company Liebherr in the country – the manufacturer of air conditioning systems for trains “Liebher Transportation Systems Maritsa” is also in the top 40, and the group’s new plant – “Liebher – concrete technologies Maritsa”, for concrete trucks, is slightly below the line. which has been operating since 2021 and last year grew by 483% to BGN 53.3 million. Or together, the three enterprises of the group have a turnover of BGN 720 million, which would put them in second place in the ranking.
“The increase in turnover of the companies is mainly due to the excellent knowledge of the markets and the quick adaptation to the changing economic and financial environment”, comments the director of “Finance and Administration” Hristo Georgiev. According to him, constant investments in improving production and qualification of personnel are also important.
Reaching the pinnacle of wheels
Bicycle manufacturers traditionally have a stable presence in the ranking. In addition to the sector leader Maxcom, two other large companies – Cross from Montana and Leader – 96 from the Plovdiv village of Rogosh – also recorded double-digit growth last year. All of them benefited from the post-covid demand for the bikes, although due to high interest in 2021 and disrupted supply chains, there was a problem with parts. Last year, however, the shortage was overcome, which is also reflected in the results of the companies. An additional positive effect on the revenues was also their redirection to the production of more and more electric bicycles, which are also more expensive.
The peak appears to have been reached, with the final months of 2022 beginning to slow down. “After the middle of the year, the war in Ukraine and inflation had a serious impact on the end consumer,” said Leader – 96 manager Dimitar Zlatanov. According to him, the main reason for this is uncertainty, and not so much a decrease in income. “In such times, Europeans judge that when the product is not a first necessity, they stop looking for it. Unfortunately, our products ended up in that category,” he added. The company had huge orders lined up for the next few years, but they were delayed or turned down.
Cross has similar observations. “All of a sudden at the end of November 2022, someone seemed to cut off sales all of a sudden. Orders stopped, some were canceled. It turned out that the dealers everywhere are full to the brim”, commented the manager and majority owner Lyuben Martinov.
This trend continues this year, as Leader – 96 expects for the first time to record a decline in turnover. Slightly weaker results are predicted by Cross. However, Maxcom predicts a 10-15% growth in revenue for the entire year, but this is below the reported 50% for the first half of the year. Due to the complicated economic situation, the company is also postponing the assembly of bicycles in its joint venture with Austrian Pierer Mobility, and the plant under construction is currently planned to be used as a distribution center.
After another year of double-digit growth, the turnover of the Sofia-based manufacturer of components for industrial automation “Festo Production” has already reached nearly BGN 260 million.
A significant growth (61.2%) was also reported by the Plovdiv manufacturer of industrial robots “Milara International”. The company states that last year they had more orders from contractors and a larger volume of production. Recently, the company also started producing electric trucks, which will become an increasingly important focus in the coming years. According to Milara’s forecasts, revenues will grow by another 30% this year. And next year, the construction of a new base for the production of electric cars will be completed.
The ranking also includes a strong group of manufacturers of hydraulic cylinders and components, all of which are rapidly growing: Kazanlak “M+S Hydraulics” (45.2%), “Kashif” (80.8%), Kardzhali “Serta Bulgaria” (30.9%) and Yambol “Hydraulic elements and systems” (34%). Their total turnover is over half a billion BGN.
The manufacturer of optical products “Optiks”, whose main base is in Panagyurishte, and since last year has a factory in Plovdiv, also increased its revenues by a third. As the reason for the growth, the company points to the optimization of processes and the focus on the production of best-selling products. The abatement of the covid crisis and the expansion of markets in the industry are the external factors that positively influenced the results. For this year, “Optiks” is also secured with orders.
The electronics manufacturer Katek Electronic Bulgaria, which traditionally grows by 15-20% per year, has strong expectations. Last year, the company expanded its factory in Saedinenie and added new lines. Therefore, the forecasts for 2023 are to double its turnover, and the number of workers to increase by about 80 to 540 people.
For the sector as a whole, the risks this year are related to the recession in Europe, where a large part of the production is directed. However, judging by the forecasts of the largest companies, the results in the next ranking will also be up.
Read the full article in Bulgarian here