Top 6 industries doing well in the downturn

Local industry of noncarbonated drinks - +3% growth in H1

High temperatures and consumers’ shift to healthier natural drinks have kept local non-carbonated drinks on growth in first six months this year.

“In Romania, per capita consumption of non-carbonated drinks is 10 liters, a low consumption compared to other European countries. Therefore, the potential of the market remains high, and this will reflect in the drink makers’ sales”, said Shachar Shaine, chairman of United Romanian Breweries Bereprod (URBB) & Carlsrom Beverage.

The company is present in the local non-carbonated drinks market with Granini brand and currently holds a market share of 7%.

According to URBB, the market stood at 250 million euros, the company forecasting a slight increase of 3%.

General insurances - +7.58% in H1

Insurance market experienced its first decline in first quarter 2009 in its history.

Even if the traditional insurance premiums fell 1.98% in first half, and unit-linked premiums decreased by 5.19%, the local market was lifted by the advance of general insurance segment, according to Sigma publication published by Swiss Re.

Romanian insurance industry increased by 5.55% in first half this year, up to 4.67 bn lei, the advance of general insurance compensating the decline recorded by life insurances, data provided by market watchdog show.

Cosmetics - +10% in H1

Unlike other struggling industries, cosmetics sector remains proof to the devastating effects of economic stress.

“People still use shampoo to wash hair. Women still seduce men and buy cosmetics to help their self image even during recessionary times. If we take a look at the women walking down the street, we see that for example, for makeup and hair-dye products, the daily consumption remained at the same level”, said Richard Matalon, country managing director of L’Oreal Romania.

Nevertheless, consumers jump from top-premium brand names to more affordable products and turn to the discount stores for promotions.

Coaching - +15-25% in H1

Another industry that flourishes amid downturn is coaching, players booking revenues 15-25% higher in first quarter from a year earlier.

“Of all the meetings I have had with various specialists in the field, I found that their businesses increased by around 15% YoY in first half. The industry has even thrived in the adversity of a recession, as managers need to cope with a variety of staff-related problems, that he solves by using the services of a specialists”, said Horea Murgu, former chairman of Romanian Association of Coaching.

Currently, Murgu is member of the association’s board of directors, and also a coach and freelancer.

“I think the coaching industry had the potential of growing even more in the first six months, but for the moment, people don’t fully grasp the notion of coaching”, he added.

Health care: +25-30% in H1

Two-digit growth, high profits, and optimistic predictions for the following half - it is not an excerpt from a mothballed speech, but the recent statements of the large health clinics managers.

The effects of economic crisis didn’t seem to have laid an imprint on the financial performance of private health care centers, such as MedLife, Centrul Medical Unirea and Medsana, top three players in the local health industry. The situation must not be generalized, Mihail Marcu, chairman of MedLife board of directors stresses. The first half was a good time for the health care services to settle, as small players suffered due to liquidity-related problems, a decline that made them toss the towel, while large centers continued to secure a solid position in the market, while taking a more cautious approach.

Tobacco - +37% in H1

According to data provided by AC Nielsen, the local tobacco industry has increased in first half this year to 4.8 billion lei (1.12 bn euros).

Year-over-year, the growth in terms of volume stood at over 10% and over 37% in terms of value.

Prestige and Premium segments increased while Value and Base sectors fell. If in the first half last year, the premium segment accounted for 35.4% in the market, at the end of June 2009, the share extended to 38.1%.