In a country that has undergone a historic deindustrialisation, with dozens of large manufacturing companies closing down in recent decades, the return of a historic industrial company in the last decade stands out, in a spectacular turn-around story.
Papoutsanis, a company with a long history, encountered many obstacles, reaching one step before shut down amidst bad management choices. The return of a company with 151 years of history that employs 130 employees in Ritsona, Evia and maintains one of the most modern soap factories in Europe, is an extremely positive event.
In 2010, the company nearly closed its doors but with the appropriate changes in management, completed a turnaround and four years ago returned to profitability, even showing double-digit growth.
During the crisis, from 2010 to 2020 the company more than tripled its turnover, 12.9 million euros in 2010 to 40.8 million euros in 2020. In 2017, turnover was 20.8 million euros, in 2018 24.2 million euros and in 2019 30.6 million euros.
2010 was a pivotal year, amid strikes, poor results, inflated losses, high debt and a share that had been place under surveillance by market authorities. At the time, management was taken over by Georgios Gatzaros and Menelaos Tassopoulos, who are still at the helm. They gradually acquired the majority of the shares from the David group, to which Papoutsanis had been sold in 1990, while at the end of 2010 a capital boost of 12 million euros was completed, helping strengthen working capital, supply of raw materials and the repayment of liabilities. Then, the historical name of Papoutsanis returned, as the company had been renamed “Plias” for several years.
Recently, some 40 million euros have been invested in the modernization of the unit, a new automated cosmetics packaging line, a new production line of hotel soaps, etc. It is now the leading Greek company in its field and among the three largest soap producers in Europe. It has the largest production unit of its kind in SE Europe, fully vertical and one of the most technologically advanced in all of Europe.
Papoutsanis holds a leading position in the category of soap bars, being the largest supplier of hotel personal care products in Greece. In total, it produces over 150,000,000 items of finished product annually and exports to more than 25 countries, in Europe, Mexico, New Zealand and Australia while there is a target to move into Asia, particularly China and South Korea.
In 2020 Papoutsanis showed turnover of 40.8 million euros (+33%), EBITDA of 7.5 million euros, versus 3.8 million euros in 2019, while net profit amounted to 3.8 million euros, against 1.3 million euros in 2019 (+184%). As management stressed yesterday during the presentation of earnings, the goal for 2021 is to increase sales in the hotel sector compared to 2020, aiming at 50% of 2019 levels.In 2020 sales in the hotel market fell by 66 percent compared with 2019.
The company is looking forward to a better tourist season this year, but also to the start of agreements with large foreign hotel chains, which were concluded last year, but were delayed due to the pandemic.
The company expects higher revenues from soap mass, while demand for hygiene products and disinfectants continues to be high. In fact, it will increase exposure to surface antiseptics used by hospitals and for industrial purposes.
By June next year, the 10-million-euro investment program announced last year will have been completed, increasing production and the ability to produce new products. In 2019, the company moved ahead with two capital returns, while for 2020 it will propose a dividend of 0.05 euros per share. Exports amounted to 20 million euros, representing more than 49 percent of total turnover, compared to 15 million euros in the previous year.
Reflecting the upturn in recent years, Papoutsanis shares have soared 1,517 percent from the low of 0.1410 euros seen 4 years ago, in February 2017.