Net profit ratio of the largest Russian furniture manufacturers

ranking 24/01/2019

Information agency Credinform has prepared a ranking of the largest Russian furniture manufacturers. Furniture manufacturers with the largest annual revenue (TOP-10) were selected for the ranking, according to the data from the Statistical Register for the latest available accounting periods (2015 - 2017). Then they were ranked by revenue (Table 1). The analysis was based on the data from the Information and Analytical system Globas.

Sales revenue is money or tangible assets in monetary terms received as a result of business activity after sale of goods and services. Net profit ratio is calculated as a relation of net profit (loss) to sales revenue.

Revenue and the ratio demonstrate the company’s scale and efficiency of its business activity. As a rule, the larger the revenue, the stronger its resistance to negative factors that could be ruinous for small and microenterprises. Revenue also reflects production capacity of a company, especially if taken over time. A real assessment of the company’s market competitiveness can be made by adding net profit ratio to the analysis. A high net profit ratio (higher than the average industry one) indicates a more favorable company’s position in relation to its competitors.

In general, the analysis of furniture production sector shows that this market is rather low concentrated, in other words, there is a large number of participants: 42,2% of total revenue is accounted for by TOP-50 companies, and 86,2% - by TOP-1000. In addition, both in 2016 and 2017 almost half of companies of the sector had a net profit ratio higher than the average industry value. This indicates that this market comprises mostly small and medium-sized companies, and that entry barriers are not high.

A combination of both indicators and their change over time is to be taken into account to get a full and fair view of financial standing of the companies of the sector. See the ranking of TOP-10 companies below (Table 1).

Table 1. Revenue, net profit, net profit ratio, solvency index Globas of the largest Russian furniture manufacturers (TOP-10)
Name, INN, region Sales revenue, million RUB Net profit (loss), million RUB Net profit ratio, % Solvency index Globas
2016 2017 2016 2017 2016 2017
1 2 3 4 5 6 7 8
INN 3907046732
up8809 up10499 up12,3 down-0,3 up0,1 down0,0 275 Medium
INN 3305037917
down7494 up8450 down1052,8 down320,6 down14,0 down3,8 227 Strong
Furniture factory Marya LLC
INN 6455026772
up6486 up7189 up24,8 up142,3 up0,4 up2,0 200 Strong
INN 6432009756
up5303 down4613 up213,8 down161,1 up4,0 down3,5 296 Medium
INN 5050079140
up3313 up3906 up27,3 up41,3 up0,8 up1,1 222 Strong
INN 6002005478
up3527 up3884 up546,3 up623,1 up15,5 up16,0 175 High
INN 5049007736
down3315 up3611 up0,7 up114,8 up0,0 up3,2 210 Strong
INN 4715011103
up3365 up3431 down-203,8 up-84,5 down-6,1 up-2,5 251 Medium
INN 4312146860
down4137 down3346 down-76,3 up4,0 down-1,8 up0,1 290 Medium
INN 5029042443
down2937 down2908 down52,9 up26,4 down1,8 up0,9 213 Strong
Total for TOP-10 companies 48686 51836 1651 1349    
Average for TOP-10 companies 4869 5184 165 135 2,88 2,81
Average industry value 26,1 28,8 0,7 0,7 2,77 2,37

Up — improvement compared to prior period, Up — decline compared to prior period.

In 2017, seven of TOP-10 companies improved their revenue, and also seven companies advanced their efficiency and improved net profit ratio. Along with this, average sales revenue of TOP-10 grew, and average value of net profit declined slightly.

Picture 1. Net profit ratio and revenue of the largest Russian furniture manufacturers (TOP-10) Picture 1. Net profit ratio and revenue of the largest Russian furniture manufacturers (TOP-10)

45,47% of total industry revenue in 2017 was produced by companies of the Central federal district (Picture 2). Moscow and the Moscow region have 15,37 and 14,1% of total revenue respectively, and St. Petersburg - 5,94%. In addition, 10,6% of companies’ legal addresses are in Moscow, 8,5% - in St. Petersburg, and 8% - in the Moscow region. This indicates that to some extent furniture production is concentrated in the Central federal district, and federal cities (Moscow and St. Petersburg) play an important role within the industry.

Picture 2. Regions by their share in total revenue of 2017 Picture 2. Regions by their share in total revenue of 2017

During the decade, average industry value of net profit ratio have been rather stable, excluding crisis years with small decrease (Picture 3). In general, the industry has coped the recession of 2013-2015 and has come to a stable level of the ratio.

Picture 3. Change in average industry value of net profit ratio in 2008 – 2017 Picture 3. Change in average industry value of net profit ratio in 2008 – 2017