Financial results of Honka
Jake | January 7, 2010Honkarakenne, holder of Honka log homes brand, has published financial results for year 2005. In short, company took a beating on two important export areas, Germany and Japan, while other markets were doing well. Turnover was nearly 80 million euros and loss bit over one million euros.
Sales to Japan fell primarily because of the weak value of yen. American log home companies now have the advantage in Japan, because dollar is not as strong as euro is when compared to yen.
Germany is totally different matter. Country is part of euro zone and currency fluctuations don’t affect the business. However, images and trends do affect. This is why Honka is in trouble. Company has been promoting the idea of ready-made homes but customers have not embraced the idea. Sales have dropped as marketing investments have supported the new business model. As a concrete example, Germany’s share of Honka sales used to be 20% but now Germany contributes with only 10%. Company is now returning back to basics and supports the sale of unique log homes and log cabins.
Russia remains an interesting market area as country’s building tradition favors massive logs. Honka happens to be an expert in log homes and cabins that are manufactured from massive pine logs. Russia’s economy is also regaining strength, therefore creating possibilities for recreational housing investments – golf courses, company getaways and accommodation cabins being high on the list.
United States gets mentioned only indirectly, “The objectives set for 2005 were met in France, other Central European market areas, and in the United States.” Read the paper at Honka investor page.
