ECONOMY

Mobile telephony retailer plans more foreign expansion

The management at mobile phone and electronic goods retailer Germanos will strive to bolster its network of foreign outlets, both in countries where the firm already operates and in new territories, the listed firm announced yesterday. Between 17 and 18 percent of the company’s total sales stemmed from activities abroad, the firm’s Managing Director Yiannis Karayiannis told a news conference yesterday. Karayiannis added that the firm expected this figure to increase to 30 percent by 2005. The Greek firm’s administration is planning to increase its emphasis in Poland, the country where Germanos is already represented by the greatest number of foreign retail outlets. The firm plans to more than double its retail presence in Poland with 350 retail outlets by the end of 2005 through takeovers in the current year. Germanos is also considering expanding its operations in Serbia and Montenegro, and Ukraine. At present, Germanos’s retail network, both in Greece and abroad, amounts to over 580 outlets in six countries. The firm operates 290 stores in Greece, 146 in Poland, 66 in Romania, 46 in Bulgaria, 20 in the Former Yugoslav Republic of Macedonia (FYROM), and 18 in Cyprus. The firm’s officials said that its criteria for expanding its retail presence in new markets were low market penetration rates, lack of organized retail trade, and the existence of more than one operator in the mobile telephony sector. Bulgaria currently stands out with an exceptionally low penetration rate of 34 percent, which is constantly rising. Poland’s penetration rate, also rising rapidly, is at 42 percent with signs of significant growth potential. The company believes that its investments in the less developed Romanian and FYROM markets, with penetration rates of 26 and 20 percent respectively, will pay handsomely. The Greek firm also believes here is further growth potential in the Cypriot market, where the penetration rate has reached a far more mature level of 60 percent. Karayiannis also pointed out the firm’s strategic alliance with Duty Free Shops (KAE), with a 24.6 percent stake, as another source of considerable business activity for Germanos. KAE operates a total of 56 outlets around the country, offering a wide variety of brand-name products, while sales growth potential is high in 2004. KAE expects to post pretax profits of 50 million euros this year, and 70 million next year.