In an interview given to the well-known Turkish economic magazine, Turcomoney, in its special section dedicated to the Western Balkans region, the Vice President of BALFIN, Steven Grunerud, has made a balance sheet of the last year and the impact that the pandemic has had on the enterprise. He also revealed important details on the Group’s future investments and developments.
The full interview:
Mr. Grunerud, when was Balfin founded? In which sector and in which country did the group start its business activities first? 2) Your company headquarters is located in Albania. In which countries do you have investments other than Albania? In which sectors do you continue your activities?
Mr. Samir Mane founded BALFIN Group in 1993 in Vienna Austria and its first business activity was in the wholesale sector of electronics and home-appliances. Currently the Group is operating and located in Austria, Albania, Kosovo, Bosnia and Herzegovina, North Macedonia, Montenegro and Netherlands and is present in several industries such as real estate, retail, mining and smelting industry, banking, tourism, energy, logistics, etc.
What are the medium and long term goals of your group of companies in the Balkan market? 4) What would you like to say about your mission and vision?
Balfin is looking to expand in its existing sectors in the region and in further geographic areas. Our mission is to bring new and modern concepts to Albania and the region and invest in promising areas. For example Balfin opened the first organized retail in Albania, in electronics and groceries, and developed the first shopping malls in Albania and North Macedonia. Our vision is to add value to the communities that we operate in and develop our business according the best business practices available.
What is your group’s annual turnover and profit amount? Could you please compare the figures of 2019 and 2020?
The 2019 audited turnover was approximately 480 million Euros while in 2020 the estimated turnover was 388 million Euros. The turnover decline is mainly due to lockdown that affected retail sector and fall of prices in international markets for mining industry.
What incentives and other advantages does the Albanian government offer for foreign investors and entrepreneurs? As one of the leading organizations of Albania, what are your recommendations to companies that want to invest in the country?
Albania offers many opportunities starting with the optimal geographical location, positioned between east and west and proximity to European markets, neighboring with Greece and Italy. Albanian has a competitive labor costs with young and educated population. The country has strong potentials to grow with agriculture and tourism reflecting significant growth. Albanian Government has planned to invest in renewing the actual transport infrastructure, including new ports, new road segments and new airports. This will give the country a boost in transportation of goods and people and further growth of the business.
When you look at the current socioeconomic and political line of Albania, what kind of projection can you present about the future regarding your Group?
Although our headquarters are in Tirana, Albania, BALFIN Group is an international investment group. We are very positive about the future of the Western Balkans region. We believe in the potential of the people in this region that is why we are optimistic about our investments here.
Does your group have local and international partnerships and collaborations? If so, could you give us information about them?
The Group operates in various industries, applying the highest global business principles and speaking the local language. Consequently, BALFIN Group is a commended and applauded partner for a large number of significant international companies and financial institutions. As an example for your readers, we have a very positive cooperation with Arcelik Group. Neptun, part of BALFIN Group, is the exclusive partner of Beko. We have very good partnership with financial institutions such as EBRD (European Bank for Reconstruction and Development), Raiffeisen Bank, Societe General, Intesa San Paolo Bank, and other foreign financial institutions.
9) Does your group have a strategy to grow by buying a company?
We are an ambitious investment group that wants to grow further. We have expanded both by growing naturally in developing our retail sector from the ground up, but we have also acquired companies such as in the mining and smeltor sector and banks. We carefully analyze all opportunities that we find.
10) Investments have slowed down in the business world and profits have decreased due to the pandemic. What precautions have you taken in this regard? Have you had any investments canceled or suspended? If so, will these investments be on the agenda again in the upcoming period?
The Covid-19 pandemic created a very challenge new reality for everyone and all social, political and economic activities. Many businesses decided to cut back investment due to the uncertainty created by this situation. We went the other way around. We decided to continue our ongoing investments. The retail network continued its expansion by opening new stores in new cities. Real estate projects continued the same. This last month BALFIN Group signed an important agreement for the construction of a new hotel on the Ionian coast, one of the most beautiful seas in the Mediterranean, with Accor, the French tourism giant. We continued our actual investment in mining and smelting to increase production and quality, despite the fact that prices in international markets are not so positive.
How many employees does Balfin have in all companies? What kind of a working model do you apply during the pandemic period? Have you had to make decisions such as staff reduction or downsizing?
BALFIN Group has directly employed about 6,000 people and about 3,000 more are indirectly employed, in our partners whose function and work is mainly related to the activity of our Group’s companies.
From the beginning of the pandemic, our focus was health and safety of our employees, customers and partners. Different group companies have followed different policies and protocols, implementing the recommendations of the respective countries where they operate. In general we are still growing and hiring, no staff were let go due to the pandemic.
What are your goals for 2021? Do you have new investment plans?
All BALFIN Group companies operate in very competitive markets and industries. This created the conditions for further improvement and growth for the Group, implementing new ideas, investing in innovation and improving standards.
In 2021, BALFIN Group will invest approximately 86 million Euros in the development of the real estate. In the autumn of this year, in Skopje North Macedonia, will be inaugurate one of the most important investments of the Group, East Gate. This shopping centre will be the third of the kind owned by BALFIN Group, following the success story of TEG and QTU in Tirana, Albania. Now, BALFIN Group is positioned as one of the larger foreign investors in North Macedonia.
TEG shopping centre, in its 10th anniversary, will expand and will offer more shopping opportunities.
In collaboration with Accor Group, one of the most important worldwide groups in hospitality industry, BALFIN Group will start the construction of the very first MGallery boutique hotel in one of the most amazing beaches of the Mediterranean Sea, in Palasa, Albanian Riviera.
Following the investments in real estate development, another important milestone is the latest investments in residences in Wien, Austria. This is the second investment in real estate development in Austria for BALFIN Group.
In retail industry, all Group Companies have concrete projects to expand their chains of stores increasing the number of brands and partners and further improving quality of service for costumers. This will be an investment of around 6 million Euro in Western Balkans Region.
In the banking sector, Tirana Bank, part of BALFIN Group since 2019, will continue to expand the number of branches but also improve the service and online solutions. Besides the investment to offer more e-banking services, Tirana bank within 2021 will be present in Kosovo as well.
Despite the very difficult years for mining and smelting industry, BALFIN Group has never stopped the investments in both its companies, AlbChrome in Albania and Newco Ferronikeli LLC in Kosovo. This year there will be invested approximately 19 million Euros to increase production and standards, besides offering more jobs for the local communities.
In total, during 2021 BALFIN Group companies will make over 108 million Euro of investments.
