Within the first nine months of 2023, the SBA textile group, Utenos Trikotažas, reported revenues of EUR 17.2 million, representing a 34.7% decrease compared to the previous year when the group's sales amounted to 26.3 million euros. Despite the decline in sales, the pre-tax losses of the Utenos Trikotažas group after the first nine months of 2023 were 20% lower than the previous year, totaling 1.3 million euros.
Fixed Costs Reduced by 20%
Utenos Trikotažas continues its pursuit of optimizing production processes and implementing measures to enhance operational efficiency. "As a result of the implemented decisions, we have reduced fixed costs by one-fifth, while still being able to produce at the level of 2022," remarks Nomeda Kaucikiene, the Managing Director of Utenos Trikotažas. According to her, the sales performance in the third quarter of this year was very similar to the second quarter, as the global economic and geopolitical situation has led to a slowdown in demand and revenue growth.
Prepared for the Return of Demand
"Although we have significantly trimmed our costs, we are smartly economizing while not reducing operational expenses and investments directed towards future sales. Our product development team actively creates modern materials, invests in advanced material development and printing technologies, and upholds sustainability standards highly valued by our customers, despite the substantial resources it entails," asserts Nomeda Kaucikiene.
According to N. Kaucikiene, disruptions in demand have affected all industries, and companies across various sectors have been grappling with similar challenges due to economic uncertainty and geopolitical tensions. While customer activity at textile fairs is creating a sense of positive change, tangible improvements may not materialize until early 2024. Presently, both production processes and the company's cost structure have been optimized, and Utenos Trikotažas is well-prepared for the resurgence of market demand.
For the UTENOS brand, developed by Utenos Trikotažas, sales over the first nine months amounted to EUR 1.6 million, marking a 45% decrease compared to the same period in 2022. This reduction in sales for this business segment is linked to strategic decisions made in 2022 aimed at optimizing company operations and prioritizing the core activity of contract manufacturing for globally recognized brands.
Sales of functional-technical clothing produced by Utenos Trikotažas subsidiary, Šatrija, showed little change, decreasing by 2% to 1.9 million euros.
About Utenos Trikotažas
Utenos Trikotažas is one of the largest and modern knitwear manufacturers in Central and Eastern Europe. Its specialized focus lies in on-demand ready-to-wear production and jersey fabric development for leading international brands, covering the entire production process from yarn to finished products.
Utenos Trikotažas Group operates three factories - AB "Utenos Trikotažas" (Lithuania), AB Šatrija (Lithuania) and OAO Mrija (Ukraine). Environmental and social responsibility commitments cover all areas of Utenos Trikotažas' production and operations - from organically farmed natural fibers, the use of chemicals in production, to fair pay for employees and absolute transparency in production processes. Together with 29 other companies, Utenos Trikotažas is part of the SBA group, employing over 4000 specialists.
